Annual FCC Regulatory Fees Due September 25, 2018

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Please be reminded of the upcoming filing listed below:

Annual FCC Regulatory Fees

Most Federal Communications Commission (FCC or Commission) licensees and other regulated entities must pay regulatory fees annually to offset costs associated with the FCC’s enforcement, public service, international, policy, and rulemaking activities.  Fee amounts change each year and vary by type of activity.  On August 30, 2018, the FCC released a Public Notice announcing a payment deadline for annual regulatory fees of no later than 11:59 PM Eastern Daylight Time on September 25, 2018.  Although the regulatory fees will not officially become effective until published in the Federal Register, entities that are required to pay fees have discretion to submit payments at any time before the deadline.

     The Commission will not issue bills for the regulatory fees and it is the licensee's responsibility to determine the fees owed (regardless of the amount posted on the Fee Filer system).
 
     Regulatory Fees

As noted in the Commission’s Assessment and Collection of Regulatory Fees for Fiscal Year 2018 Report and Order released on August 29, 2018, for FY 2018, the FCC has assessed and plans to collect a total of approximately $322 million in regulatory fees.  The Commission calculates regulatory fees by first determining the number of full time employees (FTEs) who perform the regulatory activities specified in section 9(a) of the Communications Act.  These employees, or FTEs, are categorized as either “direct” or “indirect.”  “Direct” FTEs are employees who perform regulatory activities in one of the “core” bureaus (i.e. the Wireless Telecommunications Bureau, Media Bureau, Wireline Competition Bureau, and part of the International Bureau).

Additional information about several of the fee categories is included below and fact sheets detailing the types of fees, fee codes, payment methods and options for all regulatory fees can be found on the FCC’s website.

  • Telecommunications Service Providers.  The Interstate Telecommunications Service Provider (ITSP) Fee must be paid by most companies, including VoIP providers and audio bridging providers. The ITSP regulatory fee is based on end user telecommunications revenues reported on the 2018 FCC Form 499-A and this fee has decreased to $.00291 per assessable revenue dollar for FY 2018 (compared to $.00302 for FY 2017).  Responsible organizations (“RespOrgs”) with toll free numbers must pay regulatory fees based on their toll free number count. For FY 2018, the toll free number fee has decreased to $0.10, (compared to $0.13 for FY 2017). Due to difficulties in determining which toll free numbers held by non-U.S. RespOrgs are accessible in the U.S., the FCC has determined that non-U.S. RespOrgs will not be subject to the toll free number fee in FY 2018. The Commission noted that the fee for non-U.S. RespOrgs may be reinstated in the future.
  • Licensed CMRS Providers. Licensed commercial mobile radio service (CMRS) providers must pay annual regulatory fees for each license held as of October 1, 2017 even if the license expired after that date.  If the license was transferred or assigned after October 1, 2017, the fee is owed by the party holding the license as of the regulatory fee due date.  CMRS fees are based on the licensee's number of subscribers or telephone number counts as of December 31, 2017. CMRS cellular radio and mobile service providers will pay $0.20 per subscriber or telephone number, down from $0.21 for FY 2017, while CMRS messaging service providers experienced no rate change and will pay $0.08 per subscriber or telephone number.
  • Submarine Cable Systems and International Bearer Circuits.  Regulatory fees for submarine cable systems are paid on a per cable landing license basis for all submarine cable systems operating as of December 31, 2017, and the fee amounts vary based on the type of system. Information regarding the fees for various system types can be found on the FCC's website. International Bearer Circuits are subject to a fee of $176 per active Gbps circuit.

     De Minimis Exemptions and Requests for Fee Waivers

Under the Commission’s de minimis exemption, those entities whose annual regulatory fees, across all fee categories, total $1,000 or less, are exempt from paying FY 2018 fees. The de minimis threshold does not apply to multi-year filings. Entities are responsible for evaluating their fee liability each year to determine if the entity still qualifies for the de minimis exemption and must be prepared to provide supporting documentation to the Commission upon request.
 
     Payment Methods and Late Payment Penalties

As a reminder, fees not paid by the due date are subject to a mandatory 25% late payment penalty and delinquent payors are subject to Red Light status. The Commission also imposes administrative processing charges and interest on delinquent fees. The FCC does not waive late payment penalties. 

All licensees and regulatees must utilize the FCC's Fee Filer system to coordinate paying any fees. Fee Filer is now available for viewing and payment of 2018 regulatory fees and it can be found at https://apps.fcc.gov/FeeFiler/login.cfm. Payors must pay online by credit card, Automated Clearing House (ACH) payment, wire transfer, or Visa or MasterCard debit card – the Commission does not accept payment via check, cashier check or money order. Credit card payments to federal agencies are limited to $24,999.99 and transactions, including single payments or bundled payments of multiple bills, greater than $24,999.99 will be rejected. Payment must be received by the Commission by the 11:59PM EDT September 25, 2018 deadline.
 

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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