In June 2009, The Prepaid Press featured an interview with Ad Hoc Coalition founder Jonathan Marashlian. Last month, the FCC published a Public Notice requesting comments on a petition that telecommunications law firm Helein & Marashlian filed on behalf of the Ad Hoc Coalition of International Telecommunications Companies. According to the Public Notice, the coalition asked the FCC to issue a declaratory ruling finding that de minimis universal service fund contributors may choose either to have their underlying carrier pass through universal service fund surcharges, or to pay the contributions directly. The coalition also asked the FCC to declare that distributor revenues are not end-user revenues and that it allow prepaid calling card providers to report actual receipts from distributors rather than "face value" receipts.
Here, we speak with Jonathan Marashlian, partner at Helein
& Marashlian, about the new coalition.
GR: What is the Ad Hoc Coalition?
JM: It's a grassroots movement led by our firm and
supported by a variety of U.S. and non-U.S. companies engaged predominantly in
the international telecommunications marketplace, including prepaid calling
card providers and wholesale suppliers. For years, these companies have been
discriminated against and unfairly subjected to inequities resulting from the
Universal Service Administrative Corporation's (USAC) administration of the
federal Universal Service Fund (USF) program. I'll spare you the gory details,
but, suffice it to say, disdain for USAC and confusion about the USF program,
in general, are uniform emotions felt throughout the international telecoms
When legal and regulatory issues come up that are as uniformly distasteful as USAC's administration of the USF, most industries turn to their representative trade association to fight for equitable changes in the laws or regulations. But the prepaid international telecom community currently lacks a voice. So, although there's been a great deal of complaining and criticizing of USAC and the FCC over the past several years, very little has been done to change rules and policies the international telecoms industry universally agrees are egregiously imbalanced, unfair and burdensome.
GR: Why did you choose to confront USAC's administration of the Universal Service Fund?
JM: As a telecommunications firm with an active regulatory compliance practice, we frequently counsel clients about USF compliance. Over the past several years, we've confronted countless situations where USAC's administration of the USF program or our international telecoms clienteles' efforts to comply with USAC's Form 499 instructions resulted in unfair, prejudicial, and at times, we believe, unlawful outcomes. We also listened to our colleagues and other industry participants beyond our immediate client base and confirmed the existence of a significant number of USF revenue reporting and verification requirements conceived of and enforced by USAC -- that make it very difficult to comply with the program, even for well-intentioned companies. Over and over, what we observed and encountered were USAC requirements which were ill-conceived, unworkable, and which yielded unfair and discriminatory results, particularly with respect to international prepaid calling card providers and other companies engaged in the international telecommunications marketplace.
Having identified the problems, we surveyed what others were doing to solve them. We identified dozens of Petitions for Review filed by individual companies challenging specific USAC decisions, all just sitting at the FCC, with no action taken for months, if not years. All of the petitions were "reactive," meaning they would not have been filed but for the fact the particular company was either audited by USAC or found itself in the FCC's crosshairs. For companies lucky enough to have avoided USAC audits or FCC investigations, we hear about the extreme measures companies must take in order to comply, while trying to compete with entities that choose to avoid uncertainty by not complying at all.
The USF affects everyone in the international telecoms industry, so if the current inequities in the system are not resolved, USAC's misadministration of the program will continue to unfairly burden this particular market segment.