§  61.41   Price cap requirements generally.

   (a) Sections 61.42 through 61.49 shall apply as follows:

   (1) [Reserved]

   (2) To such price cap local exchange carriers as specified by
   Commission order, and to all local exchange carriers, other than
   average schedule companies, that are affiliated with such carriers; and

   (3) On an elective basis, to local exchange carriers, other than those
   specified in paragraph (a)(2) of this section, that are neither
   participants in any Association tariff, nor affiliated with any such
   participants, except that affiliation with average schedule companies
   shall not bar a carrier from electing price cap regulation provided the
   carrier is otherwise eligible.

   (b) If a telephone company, or any one of a group of affiliated
   telephone companies, files a price cap tariff in one study area, that
   telephone company and its affiliates, except its average schedule
   affiliates, must file price cap tariffs in all their study areas.

   (c) Except as provided in paragraph (e) of this section, the following
   rules in this paragraph (c) apply to telephone companies subject to
   price cap regulation, as that term is defined in §  61.3(ee), which are
   involved in mergers, acquisitions, or similar transactions.

   (1) Any telephone company subject to price cap regulation that is a
   party to a merger, acquisition, or similar transaction shall continue
   to be subject to price cap regulation notwithstanding such transaction.

   (2) Where a telephone company subject to price cap regulation acquires,
   is acquired by, merges with, or otherwise becomes affiliated with a
   telephone company that is not subject to price cap regulation, the
   latter telephone company shall become subject to price cap regulation
   no later than one year following the effective date of such merger,
   acquisition, or similar transaction and shall accordingly file price
   cap tariffs to be effective no later than that date in accordance with
   the applicable provisions of this part 61.

   (3) Notwithstanding the provisions of §  61.41(c)(2), when a telephone
   company subject to price cap regulation acquires, is acquired by,
   merges with, or otherwise becomes affiliated with a telephone company
   that qualifies as an “average schedule” company, the latter company may
   retain its “average schedule” status or become subject to price cap
   regulation in accordance with §  69.3(i)(3) of this chapter and the
   requirements referenced in that section.

   (d) Except as provided in paragraph (e) of this section, local exchange
   carriers that become subject to price cap regulation as that term is
   defined in §  61.3(ee) shall not be eligible to withdraw from such
   regulation.

   (e) Notwithstanding the requirements of paragraphs (c) and (d) of this
   section, a telephone company subject to rate-of-return regulation may
   return lines acquired from a telephone company subject to price cap
   regulation to rate-of-return regulation, provided that the acquired
   lines will not be subject to average schedule settlements, and provided
   further that the telephone company subject to rate-of-return regulation
   may not for five years elect price cap regulation for itself, or by any
   means cause the acquired lines to become subject to price cap
   regulation.

   [ 55 FR 42382 , Oct. 19, 1990;  55 FR 50558 , Dec. 7, 1990, as amended at
    56 FR 55239 , Oct. 25, 1991;  64 FR 46589 , Aug. 26, 1999;  65 FR 38695 ,
   June 21, 2000;  65 FR 57741 , Sept. 26, 2000;  69 FR 25336 , May 6, 2004;
    76 FR 43213 , July 20, 2011]

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