States Continue Drive to Assert Jurisdiction Over Interconnected VoIP Services


Jurisdictional lines between federal and state regulation of Interconnected VoIP services are becoming increasingly blurred as states move to assert jurisdiction over both nomadic and static Interconnected VoIP service offerings.  The trend toward increased state regulation of these services continues as the Maine and Vermont public utility commissions released orders asserting jurisdiction over Interconnected VoIP services offered in those states, and in Illinois where a new law requires providers of fixed or nomadic Interconnected VoIP services to register with the Illinois Commerce Commission (“ICC”).

In an Order released October 27, 2010, the Maine Public Service Commission (“MPSC”) determined that the fixed VoIP services offered by Time Warner Digital Cable Telephone, LLC (“Time Warner”) and Comcast Phone of Maine, LLC (“Comcast”) are “telephone services” under Maine law and, are subject to the MPSC’s jurisdiction.  In the Order the MPSC determined that the VoIP services offered by Time Warner and Comcast are offered as substitutes for traditional telephone service.  The MPSC also stated that placing and receiving VoIP calls is “indistinguishable” from placing or receiving traditional circuit-switched telephone calls.  The MPSC addressed the question of federal preemption, and concluded that not exercising jurisdiction over Comcast and Time Warner in anticipation of federal preemption would be inconsistent with its responsibility to consumers in Maine.

The Vermont Public Service Board (“Board”) reached a similar conclusion in an Order released October 28, 2010, and held that “fixed” VoIP services are “telecommunications services” under Vermont state law, and fall within the Board’s jurisdiction.  Unlike the MPSC, the Board explicitly concluded that its jurisdiction over nomadic VoIP services, such as Vonage’s DigitalVoice service and AT&T’s CallVantage, is preempted by federal law. The PSB concluded further that fixed VoIP services allow the provider to distinguish between the interstate and intrastate components of the service and therefore are within the jurisdiction of the PSB.  It remains to be seen how the Board will reconcile its holding with the FCC’s recent Declaratory Ruling finding that states are not preempted by federal law from assessing state Universal Service Fund contribution obligations on the intrastate component of nomadic Interconnected VoIP services.

Legislation signed into law in Illinois is also pushing the boundaries of state jurisdiction over Interconnected VoIP services.  An amendment to the High Speed Internet Services and Information Technology Act will require providers of intrastate nomadic and fixed Interconnected VoIP services to register with the ICC.  The law will go into effect on December 1, 2010, and will require all Interconnected VoIP providers to register by January 1, 2011. Thereafter, new providers will be required to register at least 30 days prior to their provision of service within Illinois, and will be required to notify the ICC of any change in registration information within 5 business days after the change.

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