FCC Net Neutrality Order Expected To Mean Many Policy Calls by Enforcement Bureau

The FCC also will appoint an open Internet “ombudsperson” who will serve as a “point of contact” for anyone with a net neutrality complaint, and who can refer problems to the bureau where warranted. The bureau is empowered to request a written opinion from an outside technical organization or “otherwise to obtain objective advice from industry standard-setting bodies or similar organizations.”

The order would let aggrieved parties ask that the burden of proof be shifted to the party against whom a complaint has been lodged. Industry officials said this, in effect, could mean that ISPs would be considered guilty until proven innocent. “We retain our authority to shift the burden of production when, for example, the evidence necessary to assess the alleged unlawful practice is predominately in the possession of the broadband provider,” the FCC said. It encourages parties “to resolve disputes through informal discussions and private negotiations whenever possible.” If they can’t reach middle ground, the FCC said it will not require companies with a dispute before the agency to engage in arbitration.

The FCC is expected to beef up its Washington-based staff, shifting enforcement agents from the field to headquarters (see 1503110054). Net neutrality critics already have questioned the wisdom of shifting net neutrality policy calls to a bureau that historically does not have a major policy role (see 1503060062).

The point of handling issues on a case-by-case basis is to develop a “body of jurisprudence,” said Larry Spiwak, president of the Phoenix Center and former attorney with the FCC Office of General Counsel. “Particularly for the early cases, these questions should really be resolved on the commission level because you’re setting precedent and safe harbors for how firms are going to behave.” Spiwak noted that the order will require the bureau to effectively set policy. “The Enforcement Bureau is used for things like ‘did you engage in cramming?’” he said. “It’s kind of a yes or no answer.”

An FCC spokesman said via email that a proposed shift of Enforcement Bureau staff to the commission’s Washington headquarters is not tied to net neutrality enforcement. “The recommendation for field office closures reflects the fact the Commission's non-auctions budget has been flat since 2010 even as costs rise steadily every year,” emailed the spokesman. “We are looking across the entire Commission for opportunities to use every budget dollar more efficiently.” The spokesman also defended the bureau. “The Open Internet Order provides clear rules of the road that will enable the Enforcement Bureau to carry out the Commission’s policies ensuring that consumers and innovators have access to an open Internet.”

The FCC seems determined to make the process of lodging a complaint relatively easy, said Daniel Berninger, Washington-based communication architect. The FCC is saying, “We’re going to invite people to send their complaints to us,” he said. “As a threshold matter, I can see just an inundation of things being questioned and the FCC attempting to adjudicate it.” The result will be a flood of questions waiting for an agency response, Berninger predicted. “It just brings everything to a screeching halt.” The number of issues likely to be raised “is just far too much for the FCC to handle,” said the VoIP pioneer, who has opposed Title II reclassification of broadband service.

“With the order's emphasis on case-by-case enforcement, the entire Internet ecosphere's regulatory future is a big open question,” said former Commissioner Robert McDowell, now at Wiley Rein.​ “As we saw in 2008, a less-regulatory commission's handling of the Comcast/BitTorrent matter, the agency is sometimes eager to expand its authority and achieve aggressive rulemaking through enforcement actions. Here, the agency has put no tether on its power to regulate generally in the Internet space. The sky's the limit on what will happen over the next 22 months."

University of Pennsylvania Law School professor Christopher Yoo said requiring broadband companies to offer evidence they’re not violating the rules is a major policy shift for the FCC. “The enforcement provisions conflict with the spirit of permissionless innovation that has long been the foundation of the Internet’s success,” Yoo said. “The Internet has long been based on the principle that innovator should not have to ask approval from anyone before deploying a new business model. Permitting the FCC to shift the burden of production to the innovator would make the default answer 'no' instead of 'yes.'”

Order Gives FCC Flexibility

But Michael Calabrese, director of New America’s Wireless Future Project, defended the FCC. “The commission’s challenge was to balance basic bright-line rules with future-proof flexibility to address more nuanced and unforeseeable issues case-by-case,” he said. “The commission strikes a reasonable balance.” The FCC should be “commended” for making the dispute resolution process more accessible to consumers and edge providers with limited resources, he said. “Establishing an Open Internet Ombudsman and creating separate channels for informal and formal complaints will give consumers more options and a greater ability to bring questionable practices to the commission’s attention,” he said. “A complaint process that shifts the burden to providers at a certain point is essential, since consumers can’t see behind the curtain, nor do they have the resources of big carriers.”

Advisory opinions from the Enforcement Bureau should help clear up uncertainty for broadband providers concerning edge cases or new business and technical developments more quickly, Calabrese said. “The commission is not delegating policymaking authority, but rather doing what the SEC and similar agencies do to ensure responsiveness and avoid a logjam of questions that do not rise to the level of a proceeding involving a vote by the full commission.”

Net neutrality opponents aren’t really worried about case-by-case adjudication under the new net neutrality rules, said Free Press Policy Director Matt Wood. What they don’t like is “the crystal clear statutory power to protect users granted to the FCC by Title II,” he said. The notion that broadband providers would be guilty until proven innocent is “ridiculous,” Wood added. “The burden of proof is not a finding of guilt, obviously, because it rests with one party or another before any decision is made.” An open Internet “powers our economy and our democracy” and carriers have a duty to provide “reasonably nondiscriminatory service,” he said. “It's fair that carriers have the burden of proving they aren't violating those duties or their users' hard-won rights.”

TechFreedom President Berin Szoka said one big problem he sees with the order is that sanctions against filing a frivolous complaint have negative implications only for companies doing business with the FCC. Szoka said the way the order assigns authority to the bureau to conduct investigations is similar in some ways to the way the FTC handles investigations. A number of the provisions in the rules “effectively give vast powers to the Enforcement Bureau or to future commissions to push the boundaries of the new rules,” Szoka said. “It’s hard to see how the agency could have given itself more leeway.”