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FCC reform bills put consumer interests at risk

Tuesday, November 29, 2011

FCC Reform Bills Put Consumer Interests at Risk

WASHINGTON, D.C. – As the House Committee on Energy and Commerce prepares to mark up two bills to restructure the regulatory process at the Federal Communications Commission (FCC), Consumers Union, the policy and advocacy division of Consumer Reports, sent a letter to committee lawmakers urging them not to support the proposals.
The letter contends that the bills being considered would make the process of considering the public interest for rulemakings and transactions more complicated and less effective. The organization points out that the changes proposed in the legislation would prevent the FCC from fulfilling its Congressional mandate to further the public interest, including reforms that ensure rules adopted by the FCC do not impose any additional burden on the industry, or requiring proof of consumer harm.
Parul P. Desai, policy counsel for Consumers Union, said “While there are ways to improve the FCC decision making process, these proposals would ultimately make it more difficult for the FCC to protect consumers, one of the Commission’s most important jobs. As the FCC works to promote the public interest, any ‘reforms’ made to the agency should meet that same standard. Unfortunately, we believe this legislation will do more harm than good and simply is not in the public’s best interest.”
A full copy of Consumers Union’s letter to the Committee members follows:
November 29, 2011
Dear Representative:
Consumers Union, the public policy and advocacy division of Consumer Reports®, is opposed to H.R.3309, the “Federal Communications Commission Process Reform Act of 2011” and H.R.3310, the “Federal Communications Commission Consolidated Reporting Act of 2011.” One of the most important jobs of the FCC is to help protect consumers, and while some reform may be necessary, unfortunately, we believe these bills could make it more difficult for the FCC to protect consumers from anti-consumer and anti-competitive actions.
H.R.3309 provides some positive measures to improve the FCC’s decision-making process. For example, we agree the FCC should publish proposed rules in Notices of Proposed Rulemakings so that parties can sufficiently consider and provide commentary on the actual proposed rules. Additionally, we agree that parties should have a minimum period to comment and reply in the FCC’s rulemakings. Finally, we agree that a bipartisan, majority of Commissioners should have the ability to have nonpublic collaborative discussions, subject to certain conditions.
However, we believe the majority of H.R.3309 would actually do more harm than good for a number of reasons, including the following:
The bill would require the FCC to adopt rules as long as they do not impose an additional burden on the industry. This requirement could be impracticable since it would prevent the FCC from fulfilling its Congressional mandate to further the public interest.
The bill would require the FCC to adopt rules if it is able to prove, among other things, actual consumer harm. However, this requirement would remove the FCC’s ability to make predictive judgments about probable consumer harm based on sound facts and evidence. Thus, consumers would have to be harmed first before the FCC could adopt any consumer protections.
The bill would require the FCC to adopt rules if it considers costs and alternative forms of regulations. However, this requirement is much too broad since the FCC, as the expert agency, should have the discretion to adopt rules that are necessary to deter anti-consumer actions.
The bill limits the FCC’s ability to consider the public interest and protect consumers when considering mergers.
Similarly, while consolidating some reporting requirements may make sense, we believe the majority of H.R.3310 would do more harm than good for a number of reasons, including the following:
1. The bill removes the FCC’s obligation to report on the average monthly price of basic cable service for cable systems the FCC has found subject to competition vs. cable systems that operate as monopolies. Consequently, consumers and other interested parties would no longer have access to this valuable information in a concise and comprehensive manner.
2. The bill removes the requirement that the FCC make public when it grants a waiver of the condition of employment that a Commissioner or an employee must not have a financial stake in the industries the FCC is charged with overseeing. This requirement would limit transparency in the decision-making process.
Consumers Union fears H.R.3309 and H.R.3310 would make it harder for the FCC to protect consumers and promote the public interest and ultimately would do more harm than good. We urge you to oppose this legislation during the House Commerce Committee mark-up on November 30.
Respectfully Submitted,
Parul P. Desai
Policy Counsel
Washington Office

Contact: David Butler or Kara Kelber, 202-462-6262