## Facts

- The Telecommunications Act of 1996 required incumbent local exchange carriers (ILECs) to provide competitive carriers access to certain unbundled network elements (UNEs) when lack of access would “impair” a requesting carrier’s ability to provide service under 47 U.S.C. § 251(d)(2).
- The Federal Communications Commission (FCC) issued a Triennial Review Order (TRO) establishing a framework for deciding which UNEs must be made available.
- The TRO relied heavily on state public utility commissions to apply FCC standards and make geographically and product-market-specific impairment determinations affecting UNE availability.
- Multiple parties—ILECs, competitive local exchange carriers, and states—filed petitions for review and petitions for mandamus challenging different portions of the TRO.

## Issues

1. Whether the FCC unlawfully subdelegated its § 251(d)(2) impairment and unbundling responsibilities to state commissions.
2. Whether the TRO’s treatment of key UNE categories, including mass-market local switching and certain transport-related elements, satisfied the statutory “impairment” standard.
3. What remedial disposition was appropriate for TRO provisions found inconsistent with § 251(d)(2) and administrative-law limits on subdelegation.

## Decision

- The court granted in part and denied in part the petitions for review and mandamus.
- The court held that the FCC unlawfully subdelegated core § 251(d)(2) determinations to state commissions.
- The court vacated and remanded significant TRO provisions that depended on state commissions to make binding impairment determinations, including major rules governing mass-market switching and certain transport elements.
- The court remanded for the FCC to adopt rules in which the agency itself makes the required statutory judgments rather than transferring that responsibility to states.

## Legal Principles

- When Congress assigns a determination to a federal agency, the agency may seek advice and factual assistance from non-federal actors but may not transfer final, binding decision-making authority absent clear statutory authorization.
- Section 251(d)(2) requires the FCC to make impairment determinations itself; broad frameworks that leave dispositive impairment judgments to state commissions exceed that authority.
- The FCC must apply the § 251(d)(2) impairment standard in a manner that meaningfully identifies where lack of access materially limits a competitor’s ability to offer service; presumptive or effectively automatic unbundling rules are inconsistent with the statute.

## Conclusion

The D.C. Circuit invalidated central portions of the FCC’s Triennial Review Order because the FCC improperly delegated core impairment determinations to state commissions and failed to make the statutory findings required by § 251(d)(2), vacating and remanding the affected unbundling rules for further agency action.


United States Telecom Ass'n v. F.C.C., 359 F.3d 554 (D.C. Cir. 2004)