The U.S. Federal Communications Commission (FCC) has announced a proposed overhaul of submarine cable licensing rules, aiming to bolster national security while adapting to the technological and geopolitical realities of 2024. Released as part of a Notice of Proposed Rulemaking (NPRM) on November 21, 2024, the proposal introduces significant changes in ownership scrutiny, cybersecurity standards, and operational transparency. The FCC has not provided a definitive deadline for concluding the review process, but the proposed updates are already poised to impact global telecommunications networks and stakeholders.
This article consolidates the key changes, compliance metrics expected from stakeholders, and their potential implications for consortium members and global telecommunications networks.
Key Changes in the Proposed FCC Rules
The NPRM, marking the first significant update to submarine cable regulations since 2001, outlines these major changes:
Expanded Licensing Scope: The proposal includes owners, operators, and holders of Indefeasible Rights of Use (IRUs) in licensing requirements to broaden regulatory oversight and identify potential security risks.
Shortened License Terms: The FCC is considering reducing the current 25-year license term and implementing periodic reviews every three years to align licenses with technological and security developments.
Enhanced Ownership and Foreign Influence Scrutiny: Entities tied to foreign governments or previously denied licenses would face heightened barriers. There is a presumption of ineligibility for certain entities, aiming to mitigate risks tied to foreign ownership.
Cybersecurity and Operational Standards: New reporting, certification, and risk management mandates will strengthen the security and reliability of cable systems.
Team Telecom Collaboration: The proposed rules will standardize data-sharing processes with Team Telecom, streamlining the review of national security risks.
Compliance Metrics for Consortium Members
The proposed rules signal a shift toward heightened compliance and transparency. Key metrics that consortium members should anticipate include:
Ownership and Financial Transparency. Disclosure of Ownership Stakes: Members must disclose direct or indirect ownership stakes of 5% or more in cable systems. Foreign Affiliations: Any connections with foreign carriers or Managed Network Service Providers (MNSPs) must be reported. Annual Reporting: Regular updates on ownership and governance structures, particularly foreign influence, will be required.
Cybersecurity Standards Risk Management: Compliance with NIST cybersecurity frameworks or equivalent standards is mandatory. Vendor Vetting: Members must avoid using equipment or services from companies on the FCC’s “Covered List,” which identifies entities posing security risks. Incident Reporting: A plan for real-time monitoring and breach response must be implemented.
- Operational Transparency Periodic Reviews: Reviews every three years will require regular data submissions related to cable operations and ownership changes. Capacity Reporting: Accurate documentation of circuit capacity and operational metrics will be necessary. NOC and MNSP Audits: Full disclosure and certification of entities managing network operations are required.
- Collaborative Obligations Consortium Agreements: Roles and compliance responsibilities must be clearly defined within consortiums. Third-Party Oversight: Transparency in subcontractor and vendor relationships is critical.
Implications for Stakeholders
The proposed changes signal the FCC’s commitment to enhancing the security and oversight of submarine cable infrastructure. However, this shift may present challenges for stakeholders:
Increased Costs: The costs associated with implementing expanded reporting, auditing, and cybersecurity standards may be significant.
Geopolitical Risks: Stricter scrutiny of foreign-affiliated entities could impact international partnerships and collaborations.
Deployment Delays: The added compliance and review requirements might slow down the deployment of new submarine cable systems.
Recommendations for Consortium Members
To effectively navigate the impending regulatory changes, consortium members should consider the following strategies:
Invest in Compliance Infrastructure: Develop internal auditing and cybersecurity frameworks to meet new standards.
Engage Proactively with Regulators: Participate in the public comment process to provide input on how the rules can be balanced for practical implementation.
Diversify Supply Chains: Reduce dependency on single suppliers to mitigate potential risks.
Ensure Transparency: Align consortium agreements and disclosures with the new requirements.
Collaborate with Industry Peers: Share best practices and insights with other stakeholders to build a resilient industry approach.
Monitor Regulatory Developments: Stay informed through industry associations and engage with regulators to ensure timely compliance.
Conclusion
The FCC’s proposed overhaul of submarine cable regulations reflects the pressing need to bolster national security and operational transparency in an era of evolving threats and technological advancements. Consortium members and industry stakeholders must prepare for enhanced compliance and reporting measures that will shape the future of global connectivity.
Understanding and adapting to these new compliance metrics will be essential for continued participation in the submarine cable market and for maintaining the integrity and security of international telecommunications infrastructure
Kemi is a strategic leader, having worked in Public Policy, Regulatory Affairs, Cross-Continental Partnerships, Legal, Compliance, and Sustainability across some of the world’s leading infrastructure companies, such as MainOne, Subcom, and Meta. She is a co-founder at ASEF Africa and is an ex-chair of the 2Africa Project Working Group.
