III. DISCUSSION

GNAPs' application for rehearing is only partially intelligible, and it largely fails to make clear what relief is requested. The application includes claims for relief that are vague, unclear, and/or that do not appear to be supported by any argument set forth in the application (see list of requests set forth in the section entitled "Conclusion," p. 15.)³ Parties seeking rehearing of Commission decisions are required to "set forth specifically the ground or grounds on which the applicant considers the decision or order to be unlawful." (Pub. Util. Code § 1732.) This requirement was included in the Code for good reason: We can only consider contentions that are specifically stated. Accordingly, in this order, we address those of GNAPs' contentions that are reasonably intelligible, and decline to attempt to address those that are not. Nor do we address claims for relief listed in the "Conclusion" that are not supported by any argument.

To the extent the application is intelligible, GNAPs appears to challenge the hybrid solution to intercarrier compensation set forth in the Decision. GNAPs contends that reciprocal compensation is the only appropriate form of intercarrier compensation for VNXX traffic because that traffic is "local traffic." GNAPs objects to being required to compensate the ILECs for the costs of transporting VNXX traffic that ordinarily would constitute toll calls, if the rating points were the same as the physical routing points. GNAPs contends that imposing any type of compensation other than reciprocal compensation for this traffic is contrary to federal law.

In support of this argument, GNAPs relies primarily on a decision issued on July 17, 2002, shortly after the Commission issued D.02-06-076, which GNAPs characterizes as a decision of the FCC.⁴ GNAPs asserts that in this decision, "the FCC interpreted and endorsed Global Naps' positions in this docket [fn omitted], based on the FCC's interpretation of federal law." (App. Rhg., p. 1.) In fact, as Pacific and Verizon correctly point out, the Virginia Arbitration Order GNAPs relies on is an arbitration interconnection decision of the Wireline Competition Bureau of the FCC, "standing in the stead of the Virginia State Corporation Commission."⁵ It is not a decision of the FCC, and it does not purport to be anything more than a resolution, by arbitration, of specific interconnection disputes. Thus, it is not a precedential decision binding on this Commission. Moreover, Global Naps was not a party to the Virginia Arbitration proceeding. It is not possible, therefore, that the FCC (or the Bureau) "endorsed Global Naps' positions" in that proceeding. Assuming that what GNAPs means is that the Virginia Arbitration Order approved a proposal similar to the one GNAPs advanced in this proceeding, it is by no means clear that the proposal before the Wireline Bureau in that case is in fact similar. Verizon, in its response, disputes this assertion. It is unnecessary to resolve this issue, because the Bureau's Virginia Arbitration Order is a specific arbitration decision in an unrelated proceeding, which is not binding on this Commission. Even if it were, different circumstances might warrant different outcomes on this particular issue.⁶ GNAPs' reliance on the Virginia Arbitration Order is misplaced.

In support of its argument that VNXX traffic must be treated as entirely "local" for purposes of intercarrier compensation, GNAPs also relies on the ISP Remand Order,⁷ which we discussed at length in the Decision. GNAPs' arguments based on the ISP Remand Order were considered and rejected in earlier phases of this proceeding. GNAPs has failed to present any argument that persuades us that the ISP Remand Order requires a different result. As we noted in D.02-06-076, in the ISP Remand Order the FCC "has moved away from its initial use of the term `local' to differentiate the traffic that is subject to reciprocal compensation." (D.02-06-076, p. 12.) As we also noted, the FCC has also acknowledged that VNXX traffic poses specific intercarrier compensation issues, and it has not yet resolved those issues. (See Intercarrier Compensation NPRM, FCC 01-032 (released April 27, 2001, the same date as the ISP Remand Order), ¶ 115.) Thus, GNAPs' argument that the ISP Remand Order mandates that VNXX traffic be compensated as local traffic, and only as local traffic, is unpersuasive.

In the interest of clarity, however, we acknowledge that the VNXX traffic at issue in this proceeding is a "hybrid" of sorts: part local, part interexchange. In effect, in D.02-06-076, we made a distinction between the portion of the VNXX traffic that is interexchange, and the portion that is "local." (Decision, p. 12.) We believe that this distinction is practical, reasonable, and permissible under the circumstances of this proceeding. The hybrid nature of VNXX traffic explains why we concluded that "VNXX traffic is local traffic and is subject to reciprocal compensation requirements" (FF 11) and that ILECs may not assess charges to transport "local" traffic subject to reciprocal compensation (FF5), and at the same time, for "calls that are interLATA in nature, e.g., those beyond 16 miles, traditional access charges will apply." (Decision, p. 24.) It also explains why, in a recent similar proceeding, we described VNXX traffic as "interexchange traffic":

VNXX is a form of Foreign Exchange service where the purchaser of the VNXX is not physically located in the originating caller's local calling area, yet the originating call to the VNXX is considered local from the caller's perspective. VNXX traffic is interexchange traffic because it terminates outside of the originating calling area (exchange), although it is rated as a local call to the calling party. VNXX and Foreign Exchange differ from traditional local calling where the called NXX and caller's NXX resides within the same local calling area.

(Decision Approving Arbitrated Agreement Pursuant to Section 252, Subsection (e), of the Telecommunications Act of 1996, D. 03-05-075, mimeo, p. 3.)

These statements are not inconsistent if it is understood that VNXX traffic is part local and part interexchange in nature.

We also modify D.02-06-076 by deleting language expressing an intent to provide "broad policy guidance" on the intercarrier compensation issues presented in this proceeding. The United States Court of Appeals for the Ninth Circuit recently held that this Commission's authority regarding interconnection agreements under the Telecommunications Act is limited to "arbitrating, approving, and enforcing" specific interconnection agreements, and that this Commission lacks general rulemaking authority regarding intercarrier compensation under the Act. (Pacific Bell v. Pac-West Telecomm, Inc. (9^th Cir. 2003) 325 F.3d 1114).) In light of that holding, we recognize that this is not a rulemaking proceeding, and we merely resolve the disputed issues presented in this arbitration proceeding.