H. Assignment of Proceeding

Loretta M. Lynch is the Assigned Commissioner and Michael J. Galvin is the assigned Administrative Law Judge in this proceeding.

Findings of Fact

1. The Commission has the authority to change the procedure for transfers of control or assets subject to Pub. Util. Code §§ 851 through 854.

2. With respect to sales or leases of property by certificated carriers to third parties, CALTEL's proposal would substantially shorten the period of time between telecommunications carriers' requests for authority to sell or leas the property and the date the Commission grants that authority.

3. With respect to mergers between certificated carriers and corporate reorganizations, CALTEL's proposal would substantially shorten the period between telecommunications carriers' requests for authority to transfer control or assets and the date the Commission grants that authority.

4. With respect to mergers between certificated carriers and corporate reorganizations, CALTEL's proposal would retain the Commission's discretion to initiate a formal review of competitive telecommunications carriers' proposals to transfer control or assets.

Conclusions of Law

1. CALTEL's application should be granted in part.

2. The procedures described in Appendix A for competitive telecommunications carriers seeking prospective authority to transfer control or assets should be adopted.

3. Because of the public interest in simplified regulatory oversight, the following order should be effective immediately.

ORDER

IT IS ORDERED that:

1. All telecommunications carriers may file advice letters for prospective authority to transfer control or assets pursuant to Pub. Util. Code §§ 851 through 854 to the extent that the conditions set forth in Appendix A of this order are satisfied.

2. The Executive Director shall cause a copy of this order to be served on all telecommunications carriers certificated in California.

3. Application 00-12-015 is closed.

This order is effective today.

Dated________________, at San Francisco, California.

APPENDIX A

COMPETITIVE TELECOMMUNICATIONS CARRIERS

PROCEDURE FOR TRANSFERS OF CONTROL OF ASSETS




1. A telecommunications carrier certificated by the Commission may file an advice letter, instead of an application, for authority to transfer control or assets, including a merger with another certificated carrier, pursuant to Pub. Util. Code §§ 851 through 854 if all of the conditions set forth in this appendix are satisfied. The advice letter shall become effective 40 days after filing absent Commission action to suspend the advice letter.




a. The advice letter shall (1) advise the Commission that the filing carrier is a party to a pending transaction for which Commission authority is required, (2) provide the general terms of the transaction, and (3) identify any decided or pending legal complaints against the involved entities, in California or other states.




b. The advice letter shall be served on the Director of the Consumer Protection and Safety Division and those persons to whom the entity is already required to serve tariff changes under General Order 96-A.




c. Requests for authority to transfer customers shall comply with the customer notification requirements set forth in Decision 97-06-096.




d. Financial statements shall accompany the advice letter for any applicant that will continue operations after the transaction has been completed. Financial statements may be filed under seal, but doing so is subject to protest.




e. The advice letter text shall describe the terms of the transaction and indicate how any surviving Commission certified entities would modify their tariffs, if at all.




f. The advice letter text shall attest the Commission need not conduct an environmental review under the California Environmental Quality Act (CEQA) either because the transaction is certain not to cause any direct of indirect change in the physical environment or because the transaction is categorically exempt from CEQA review. In the latter case, the applicant shall provide as part of the advice letter descriptions of the proposed transaction and citations to the CEQA regulations sufficient to demonstrate the validity of the claimed exemption.




2. Unless suspended by the Commission at the request of the Commission staff, either because of a protest within a 20-day protest period from the date the matter appears on the daily calendar or sua sponte, the advice letter shall take effect and the transaction shall be deemed approved. If the Commission believes that the matter warrants more comprehensive review, the Commission may suspend the advice letter and direct the parties to file an application.




3. The advice letter procedure shall not be used under the following conditions:




a. Where an entity acquiring assets or control is not either an already certificated entity or the parent or subsidiary of a presently certified entity. In other words, the advice letter procedure described above may not be used for purposes of market entry.




b. Where transactions are subject to the requirements of Pub. Util. Code §§ 854(b) and (c).




c. Where the transaction has a potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment and is not otherwise categorically exempt from CEQA review.




(END OF APPENDIX A)