Originally published 4th Quarter 2004
On November 1, 2004, the FCC’s new "red light" rule went into effect. Under the "red light" rule, the FCC will withhold action on applications and other requests for benefits when the applicant is shown in the FCC’s database as being delinquent in non-tax debts owed to the Commission. If a delinquent debt appears in the database, the FCC will no longer accept applications, process pending applications, or bestow other benefits on the applicant until the delinquency is resolved.
Under the red light rule, the Commission will check its records against each application under that applicant’s federal registration number (FRN) to determine if the applicant or any other entity using the same taxpayer identification number (TIN) is delinquent in any debt owed to the Commission. If the Commission finds that the applicant is a delinquent debtor, the application will be "red lighted," the Commission will stop processing the application and notify the applicant that it has 30 days to either pay the debt or make arrangements for payment of the debt. It would be incumbent upon the applicant to pay the debt or prove that the Commission’s records of debt are wrong. If payment arrangements, or correction of the records, are not made, the Commission will dismiss the application or request for benefit.
There are three limited exceptions to the red light rule, as follows: (1) if the applicant timely files an administrative appeal or has contested the existence or amount of the debt, the debt will not be considered delinquent under the red light rule until the order in question is final; (2) the Commission will process applications for emergency or special temporary authority involving safety of life or property (including national security emergencies) or involving a brief transition period facilitating continuity of service to a substantial number of customers or end users; and (3) the Commission will not consider debt if the automatic stay provisions of the Bankruptcy Code are applicable. Other than these exceptions, the Commission stated that it will not process or grant any applications for which fees are currently owed or if the applicant owes past debt of some kind.
The FCC has created a new red light display system (RLD), accessible on the FCC’s Web site at www.fcc.gov/redlight, by which parties can check their red light status. We recommend that all entities or individuals doing business with the FCC review their FCC records regularly for actual or purported debts, as mistaken FRNs are a common problem that may lead to false records of debts owed. The RLD will indicate if you have a red light status and list all delinquent debts and, as of December 1, allow you to view and print copies of allegedly delinquent bills. If a review of the records shows a problem with alleged debts, we suggest that you promptly respond to such claim and have it resolved. Resolution of erroneous debts will help avoid delayed processing, or outright dismissal, of applications.
An experienced attorney knowledgeable in this area can help you with any questions or assistance regarding the new red light rule, reviewing your red light status in the FCC’s database, resolving debts that appear erroneously in the FCC’s database, or paying any delinquent fees owed to the FCC.
The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.
