Updating the Intercarrier Compensation Regime To Eliminate Access Arbitrage

In this document, the Commission shifts financial responsibility for all interstate and intrastate terminating tandem switching and transport charges to access-stimulating local exchange carriers, and modifies its definition of access stimulation. Under the existing intercarrier compensation regime, carriers enter into agreements with entities offering high-volume calling services, route the calls through interexchange carriers at more expensive rates, and profit from the resulting access charge rates which interexchange carriers are required to pay. With this action, the Commission moves closer toward its goal of intercarrier compensation regime reform by reducing the financial incentives to engage in access stimulation.