EDUCATIONAL ADVISORY: USF Wholesaler-Reseller Exemption – A Practical Guide to Compliance

UNIVERSAL SERVICE FUND:  FCC’s Wholesaler-Reseller Exemption Requirements – A Practical Guide to Compliance

Through the years, both our law firm and its affiliated consulting arm, The Commpliance Group, have represented hundreds of telecommunications and VoIP service providers with an assortment of legal and regulatory compliance matters on a nationwide basis.  More than any other area of communications regulation, the one that has confounded our clients and the industry at large has been, and continues to be, the Federal Communications Commission’s (“FCC” or “the Commission”) Universal Service Fund (“USF”) program, and the administration/enforcement of the program by the Universal Service Administrative Company (“USAC”).

One of the most important, yet challenging, elements of the current USF program are the FCC’s rules and USAC policies governing the treatment of “wholesale” revenue.  While wholesale revenue is generally exempt from the USF (and other FCC fees), not all wholesale revenue will be treated as wholesale by USAC and the FCC.  Only wholesale revenue that has been “verified” to be wholesale in full compliance with the FCC’s rules will be considered wholesale and exempt by USAC.  The failure to properly verify the exempt status of wholesale revenue will result in reclassification as retail revenue, subject to USF and potentially other FCC fees.

With just over three weeks until the April 4, 2017 deadline to file the annual reporting worksheet (FCC Form 499-A) with USAC, there is no better time to confirm your company’s compliance with the FCC’s rules and USAC policies governing the reporting of wholesale revenue.  In the interests of sharing knowledge and educating clients about the FCC Form 499 revenue reporting processes, we are sharing the linked Educational Advisory — A Practical Guide to Compliance with the FCC’s Wholesaler-Reseller Exemption Requirements.  We hope you find the following information both useful and informative.

Should you have any questions or concerns regarding your company’s compliance with the FCC’s rules or USAC’s policies on revenue reporting, please contact the attorney assigned to your account or you may contact Jackie Hankins at jrh@commlawgroup.com.

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