[House Report 106-725]
[From the U.S. Government Publishing Office]
106th Congress Rept. 106-725
HOUSE OF REPRESENTATIVES
2d Session Part II
======================================================================
WIRELESS TELECOMMUNICATIONS PRIVACY ACT OF 2000
_______
July 11, 2000.--Ordered to be printed
_______
Mr. Hyde, from the Committee on the Judiciary, submitted the following
R E P O R T
[To accompany H.R. 3489]
[Including cost estimate of the Congressional Budget Office]
The Committee on the Judiciary, to whom was referred the
bill (H.R. 3489) amending the Communications Act of 1934 to
regulate interstate commerce in the use of mobile telephones
and to strengthen and clarify prohibitions on electronic
eavesdropping, and for other purposes, having considered the
same, reports favorably thereon with an amendment and
recommends that the bill as amended do pass.
TABLE OF CONTENTS
Page
The Amendment.............................................. 2
Purpose and Summary........................................ 3
Background and Need for the Legislation.................... 3
Hearings................................................... 3
Committee Consideration.................................... 4
Vote of the Committee...................................... 4
Committee Oversight Findings............................... 4
Committee on Government Reform Findings.................... 4
New Budget Authority and Tax Expenditures.................. 4
Congressional Budget Office Cost Estimate.................. 4
Constitutional Authority Statement......................... 7
Section-by-Section Analysis and Discussion................. 7
Changes in Existing Law Made by the Bill, as Reported...... 7
The amendment is as follows:
Strike out all after the enacting clause and insert in lieu
thereof the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Wireless Telecommunications Privacy
Act of 2000''.
SEC. 2. GAO DETERMINATION OF FCC REGULATORY FEES.
Within 180 days after the date of the enactment of this Act, the
Comptroller General of the United States shall conduct a review of the
annual regulatory fees collected by the Federal Communications
Commission pursuant to section 9 of the Communications Act of 1934 (47
U.S.C. 159) to determine whether such fees have been accurately
assessed since their inception and shall submit a report to the
Congress regarding such review and determination.
SEC. 3. COMMERCE IN ELECTRONIC EAVESDROPPING DEVICES.
(a) Prohibition on Modification.--Section 302(b) of the
Communications Act of 1934 (47 U.S.C. 302a(b)) is amended by inserting
before the period at the end thereof the following: ``, or modify any
such device, equipment, or system in any manner that causes such
device, equipment, or system to fail to comply with such regulations''.
(b) Prohibition on Commerce in Scanning Receivers.--Section 302(d)
of such Act (47 U.S.C. 302a(d)) is amended to read as follows:
``(d) Equipment Authorization Regulations.--
``(1) Privacy protections required.--The Commission shall
prescribe regulations, and review and revise such regulations
as necessary in response to subsequent changes in technology or
behavior, denying equipment authorization (under part 15 of
title 47, Code of Federal Regulations, or any other part of
that title) for any scanning receiver that is capable of--
``(A) receiving transmissions in the frequencies
that are allocated to the domestic cellular radio
telecommunications service or the personal
communications service;
``(B) readily being altered to receive
transmissions in such frequencies;
``(C) being equipped with decoders that--
``(i) convert digital domestic cellular
radio telecommunications service, personal
communications service, or protected
specialized mobile radio service transmissions
to analog voice audio; or
``(ii) convert protected paging service
transmissions to alphanumeric text; or
``(D) being equipped with devices that otherwise
decode encrypted radio transmissions for the purposes
of unauthorized interception.
``(2) Privacy protections for shared frequencies.--The
Commission shall, with respect to scanning receivers capable of
receiving transmissions in frequencies that are used by
commercial mobile services and that are shared by public safety
users, examine methods, and may prescribe such regulations as
may be necessary, to enhance the privacy of users of such
frequencies.
``(3) Tampering prevention.--In prescribing regulations
pursuant to paragraph (1), the Commission shall consider
defining `capable of readily being altered' to require scanning
receivers to be manufactured in a manner that effectively
precludes alteration of equipment features and functions as
necessary to prevent commerce in devices that may be used
unlawfully to intercept or divulge radio communication.
``(4) Warning labels.--In prescribing regulations under
paragraph (1), the Commission shall consider requiring labels
on scanning receivers warning of the prohibitions in Federal
law on intentionally intercepting or divulging radio
communications.
``(5) Definitions.--As used in this subsection, the term
`protected' means secured by an electronic method that is not
published or disclosed except to authorized users, as further
defined by Commission regulation.''.
(c) Implementing Regulations.--Within 90 days after the date of
enactment of this Act, the Federal Communications Commission shall
prescribe amendments to its regulations for the purposes of
implementing the amendments made by this section.
SEC. 4. UNAUTHORIZED INTERCEPTION OR PUBLICATION OF COMMUNICATIONS.
Section 705 of the Communications Act of 1934 (47 U.S.C. 605) is
amended--
(1) in the heading of such section, by inserting
``interception or'' after
``unauthorized'';
(2) in the first sentence of subsection (a), by striking
``Except as authorized by chapter 119, title 18, United States
Code, no person'' and inserting ``No person'';
(3) in the second sentence of subsection (a)--
(A) by inserting ``intentionally'' before
``intercept''; and
(B) by striking ``communication and divulge'' and
inserting ``communication, and no person having
intercepted such a communication shall intentionally
divulge'';
(4) in the fourth sentence of subsection (a)--
(A) by inserting ``(A)'' after ``intercepted,
shall''; and
(B) by striking ``thereof) or'' and inserting
``thereof); or (B)'';
(5) by striking the last sentence of subsection (a) and
inserting the following: ``Nothing in this subsection prohibits
an interception or disclosure of a communication as authorized
by chapter 119 of title 18, United States Code.'';
(6) in subsection (e)(1)--
(A) by striking ``fined not more than $2,000 or'';
and
(B) by inserting ``or fined under title 18, United
States Code,'' after ``6 months,'';
(7) in subsection (e)(3), by striking ``any violation'' and
inserting ``any receipt, interception, divulgence, publication,
or utilization of any communication in violation'';
(8) in subsection (e)(4), by striking ``any other activity
prohibited by subsection (a)'' and inserting ``any receipt,
interception, divulgence, publication, or utilization of any
communication in violation of subsection (a)''; and
(9) by adding at the end of subsection (e) the following
new paragraph:
``(7) Notwithstanding any other investigative or enforcement
activities of any other Federal agency, the Commission shall
investigate alleged violations of this section and may proceed to
initiate action under section 503 of this Act to impose forfeiture
penalties with respect to such violation upon conclusion of the
Commission's investigation.''.
Amend the title so as to read:
A bill to amend the Communications Act of 1934 to
strengthen and clarify prohibitions on electronic
eavesdropping, and for other purposes.
Purpose and Summary
The provisions of H.R. 3489 contained in the bill as
introduced provided a uniform method for fairly and simply
determining how State and local jurisdictions may tax wireless
telecommunications. Among its goals are to provide customers
with simpler billing statements, reduce the chances of double
taxation of wireless telecommunications services, and simplify
and reduce the costs of tax administration for carriers and
State and local governments.
The Committee on the Judiciary struck all provisions of
H.R. 3489 relating to these State tax issues, because it had
previously addressed those identical issues in H.R. 4391. The
bill as reported by the Committee on the Judiciary contains no
provisions within the subject matter jurisdiction of the
Committee on the Judiciary.
Background and Need for the Legislation
For a discussion of the background and need for legislation
addressing the State tax issues relating to wireless
telecommunication services, see the Report of the Committee on
the Judiciary to H.R. 4391, the ``Mobile Telecommunications
Sourcing Act.''
Hearings
The committee's Subcommittee on Commercial and
Administrative Law held a hearing on H.R. 3489 on May 4, 2000.
Testimony was received from Congressman Chip Pickering,
principal sponsor of the bill; Ray Scheppach, on behalf of the
National Governors' Association; Thomas Wheeler, President and
CEO of the Cellular Telecommunications Industry Association;
Harley Duncan, on behalf of the Federation of Tax
Administrators; and Joseph Brooks, representing the National
League of Cities.
Committee Consideration
On May 24, 2000, the committee met in open session and
ordered favorably reported the bill H.R. 3489 with an amendment
by voice vote, a quorum being present.
Vote of the Committee
There were no recorded votes during the consideration of
H.R. 3489 by the committee.
Committee Oversight Findings
In compliance with clause 3(c)(1) of rule XIII of the Rules
of the House of Representatives, the committee reports that the
findings and recommendations of the committee, based on
oversight activities under clause 2(b)(1) of rule X of the
Rules of the House of Representatives, are incorporated in the
descriptive portions of this report.
Committee on Government Reform Findings
No findings or recommendations of the Committee on
Government Reform were received as referred to in clause
3(c)(4) of rule XIII of the Rules of the House of
Representatives.
New Budget Authority and Tax Expenditures
Clause 3(c)(2) of House Rule XIII is inapplicable because
this legislation does not provide new budgetary authority or
increased tax expenditures.
Congressional Budget Office Cost Estimate
In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, the committee sets forth, with
respect to the bill, H.R. 3489, the following estimate and
comparison prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act of
1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, June 2, 2000.
Hon. Henry J. Hyde, Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 3489, the Wireless
Telecommunications Privacy Act of 2000.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Mark Hadley
(for federal costs), who can be reached at 226-2860, Hester
Grippando (for revenues), who can be reached at 226-2720,
Shelley Finlayson (for the state and local impact), who can be
reached at 225-3220, and Jean Wooster (for the private-sector
impact), who can be reached at 226-2940.
Sincerely,
Dan L. Crippen, Director.
cc:
Honorable John Conyers Jr.
Ranking Democratic Member
H.R. 3489--Wireless Telecommunications Privacy Act of 2000.
SUMMARY
CBO estimates that enactment of H.R. 3489 would have a
negligible effect on the federal budget.
H.R. 3489 would amend the Communications Act of 1934 to
prohibit modifying any equipment used to communicate
electronically in any manner that would not comply with
regulations affecting electronic eavesdropping. In addition,
the bill would require the General Accounting Office to issue a
report on whether the Federal Communications Commission (FCC)
has accurately assessed regulatory fees.
The bill would impose criminal penalties for intercepting,
publishing, or divulging a communication that is not
authorized. Because H.R. 3489 could affect direct spending and
receipts; therefore, pay-as-you-go procedures would apply, but
CBO estimates that any such effects would be negligible. CBO
estimates that net discretionary costs to the FCC to implement
the provisions of this bill also would be negligible.
H.R. 3489 contains no intergovernmental mandates as defined
in the Unfunded Mandates Reform Act (UMRA) and would not affect
the budgets of state, local, or tribal governments.
The bill would impose a new private-sector mandate, as
defined in UMRA, on manufacturers, importers, sellers, and
those who modify scanning receivers. The direct cost of the
mandate would be well below the annual threshold established in
UMRA for private-sector mandates ($109 million in 2000,
adjusted for inflation).
ESTIMATED COST TO THE FEDERAL GOVERNMENT
H.R. 3489 would amend the Communications Act of 1934 to
prohibit modifying any equipment used to communicate
electronically in any manner that would not comply with
regulations affecting electronic eavesdropping. The bill would
direct the FCC to prepare regulations to deny the authorization
to use FCC equipment for certain scanning receivers that may be
capable of unauthorized interception of communication
transmissions. Based on information from the FCC, CBO estimates
that these regulations would cost less than $500,000 to
promulgate, assuming availability of appropriated funds.
The bill also would amend the Communications Act of 1934 to
impose criminal penalties for intercepting, publishing, or
divulging a communication that is not authorized; consequently,
the federal government might collect additional penalties if
H.R. 3489 is enacted. Collections of penalties are recorded in
the budget as governmental receipts (revenues), which are
deposited in the Crime Victims Fund and spent in subsequent
years. CBO estimates that any additional receipts and direct
spending that would occur under this bill would be negligible.
Under current law, any enforcement costs that the agency incurs
are offset by fees charged to the industries that the FCC
regulates. As a result, we estimate that this provision would
not result in any significant net cost to the federal
government.
CBO estimates that the other provisions of the bill would
have no significant budgetary impact. The costs of this
legislation would fall within budget function 370 (commerce and
housing credit).
PAY-AS-YOU-GO CONSIDERATIONS
The Balanced Budget and Emergency Deficit Control Act sets
up pay-as-you-go procedures for legislation affecting direct
spending or receipts. As noted above, H.R. 3489 could affect
direct spending and receipts, but CBO estimates that any such
effects would be negligible.
ESTIMATED IMPACT ON STATE, LOCAL, AND TRIBAL GOVERNMENTS
H.R. 3489 contains no intergovernmental mandates as defined
in UMRA and would not affect the budgets of state, local, or
tribal governments.
ESTIMATED IMPACT ON THE PRIVATE SECTOR
H.R. 3489 would impose a new private-sector mandate, as
defined by UMRA, on manufacturers, importers, sellers, and
those who modify scanning receivers. The bill would expand the
FCC's criteria for certifying equipment before it can be
imported or marketed. Based on information provided by the
leading manufacturer of scanning receivers and the FCC, CBO
estimates that the direct cost of complying with H.R. 3489
would fall well below the statutory threshold for private-
sector mandates ($109 million in 2000, adjusted annually for
inflation).
PREVIOUS CBO ESTIMATES
On May 22, 2000, CBO transmitted a cost estimate of H.R.
3489, as ordered reported by the House Committee on Commerce on
May 17, 2000. On February 22, 1999, CBO transmitted a cost
estimate of H.R. 514, the Wireless Privacy Enhancement Act of
1999, as ordered reported by the House Committee on Commerce on
February 11, 1999. The Judiciary Committee's version of H.R.
3489 is nearly identical to H.R. 514 and to the provisions of
the Commerce Committee's version of H.R. 3489 that concern
electronic eavesdropping, and our cost estimates are the same
for these provisions. The Commerce Committee's version of H.R.
3489 also contained provisions that concern state taxation of
mobile telephone services.
ESTIMATE PREPARED BY:
Federal Costs: Mark Hadley (226-2860)
Revenues: Hester Grippando (226-2720)
Impact on State, Local, and Tribal Governments: Shelley
Finlayson (225-3220)
Impact on the Private Sector: Jean Wooster (226-2940)
ESTIMATE APPROVED BY:
Peter H. Fontaine
Deputy Assistant Director for Budget Analysis
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the committee finds the authority for
this legislation in Article I, clause 8, section 3 of the
Constitution.
Section-by-Section Analysis and Discussion
H.R. 3489, as reported by the Committee on the Judiciary,
contains no sections within the committee's jurisdiction.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italics, existing law in which no change
is proposed is shown in roman):
COMMUNICATIONS ACT OF 1934
* * * * * * *
TITLE III--PROVISIONS RELATING TO RADIO
PART I--GENERAL PROVISIONS
* * * * * * *
SEC. 302. DEVICES WHICH INTERFERE WITH RADIO RECEPTION.
(a) * * *
(b) No person shall manufacture, import, sell, offer for
sale, or ship devices or home electronic equipment and systems,
or use devices, which fail to comply with regulations
promulgated pursuant to this section, or modify any such
device, equipment, or system in any manner that causes such
device, equipment, or system to fail to comply with such
regulations.
* * * * * * *
[(d)(1) Within 180 days after the date of enactment of this
subsection, the Commission shall prescribe and make effective
regulations denying equipment authorization (under part 15 of
title 47, Code of Federal Regulations, or any other part of
that title) for any scanning receiver that is capable of--
[(A) receiving transmissions in the frequencies
allocated to the domestic cellular radio
telecommunications service,
[(B) readily being altered by the user to receive
transmissions in such frequencies, or
[(C) being equipped with decoders that convert
digital cellular transmissions to analog voice audio.
[(2) Beginning 1 year after the effective date of the
regulations adopted pursuant to paragraph (1), no receiver
having the capabilities described in subparagraph (A), (B), or
(C) of paragraph (1), as such capabilities are defined in such
regulations, shall be manufactured in the United States or
imported for use in the United States.]
(d) Equipment Authorization Regulations.--
(1) Privacy protections required.--The Commission
shall prescribe regulations, and review and revise such
regulations as necessary in response to subsequent
changes in technology or behavior, denying equipment
authorization (under part 15 of title 47, Code of
Federal Regulations, or any other part of that title)
for any scanning receiver that is capable of--
(A) receiving transmissions in the
frequencies that are allocated to the domestic
cellular radio telecommunications service or
the personal communications service;
(B) readily being altered to receive
transmissions in such frequencies;
(C) being equipped with decoders that--
(i) convert digital domestic
cellular radio telecommunications
service, personal communications
service, or protected specialized
mobile radio service transmissions to
analog voice audio; or
(ii) convert protected paging
service transmissions to alphanumeric
text; or
(D) being equipped with devices that
otherwise decode encrypted radio transmissions
for the purposes of unauthorized interception.
(2) Privacy protections for shared frequencies.--
The Commission shall, with respect to scanning
receivers capable of receiving transmissions in
frequencies that are used by commercial mobile services
and that are shared by public safety users, examine
methods, and may prescribe such regulations as may be
necessary, to enhance the privacy of users of such
frequencies.
(3) Tampering prevention.--In prescribing
regulations pursuant to paragraph (1), the Commission
shall consider defining ``capable of readily being
altered'' to require scanning receivers to be
manufactured in a manner that effectively precludes
alteration of equipment features and functions as
necessary to prevent commerce in devices that may be
used unlawfully to intercept or divulge radio
communication.
(4) Warning labels.--In prescribing regulations
under paragraph (1), the Commission shall consider
requiring labels on scanning receivers warning of the
prohibitions in Federal law on intentionally
intercepting or divulging radio communications.
(5) Definitions.--As used in this subsection, the
term ``protected'' means secured by an electronic
method that is not published or disclosed except to
authorized users, as further defined by Commission
regulation.
* * * * * * *
TITLE VII--MISCELLANEOUS PROVISIONS
* * * * * * *
SEC. 705. UNAUTHORIZED INTERCEPTION OR PUBLICATION OF COMMUNICATIONS.
(a) [Except as authorized by chapter 119, title 18, United
States Code, no person] No person receiving, assisting in
receiving, transmitting, or assisting in transmitting, any
interstate or foreign communication by wire or radio shall
divulge or publish the existence, contents, substance, purport,
effect, or meaning thereof, except through authorized channels
of transmission or reception, (1) to any person other than the
addressee, his agent, or attorney, (2) to a person employed or
authorized to forward such communication to its destination,
(3) to proper accounting or distributing officers of the
various communicating centers over which the communication may
be passed, (4) to the master of a ship under whom he is
serving, (5) in response to a subpena issued by a court of
competent jurisdiction, or (6) on demand of other lawful
authority. No person not being authorized by the sender shall
intentionally intercept any radio [communication and divulge]
communication, and no person having intercepted such a
communication shall intentionally divulge or publish the
existence, contents, substance, purport, effect, or meaning of
such intercepted communication to any person. No person not
being entitled thereto shall receive or assist in receiving any
interstate or foreign communication by radio and use such
communication (or any information therein contained) for his
own benefit or for the benefit of another not entitled thereto.
No person having received any intercepted radio communication
or having become acquainted with the contents, substance,
purport, effect, or meaning of such communication (or any part
thereof) knowing that such communication was intercepted, shall
(A) divulge or publish the existence, contents, substance,
purport, effect, or meaning of such communication (or any part
[thereof) or] thereof); or (B) use such communication (or any
information therein contained) for his own benefit or for the
benefit of another not entitled thereto. [This section shall
not apply to the receiving, divulging, publishing, or utilizing
the contents of any radio communication which is transmitted by
any station for the use of the general public, which relates to
ships, aircraft, vehicles, or persons in distress, or which is
transmitted by an amateur radio station operator or by a
citizens band radio operator.] Nothing in this subsection
prohibits an interception or disclosure of a communication as
authorized by chapter 119 of title 18, United States Code.
* * * * * * *
(e)(1) Any person who willfully violates subsection (a)
shall be [fined not more than $2,000 or] imprisoned for not
more than 6 months, or fined under title 18, United States
Code, or both.
* * * * * * *
(3)(A) Any person aggrieved by [any violation] any receipt,
interception, divulgence, publication, or utilization of any
communication in violation of subsection (a) or paragraph (4)
of this subsection may bring a civil action in a United States
district court or in any other court of competent jurisdiction.
* * * * * * *
(4) Any person who manufactures, assembles, modifies,
imports, exports, sells, or distributes any electronic,
mechanical, or other device or equipment, knowing or having
reason to know that the device or equipment is primarily of
assistance in the unauthorized decryption of satellite cable
programming, or direct-to-home satellite services, or is
intended for [any other activity prohibited by subsection (a)]
any receipt, interception, divulgence, publication, or
utilization of any communication in violation of subsection
(a), shall be fined not more than $500,000 for each violation,
or imprisoned for not more than 5 years for each violation, or
both. For purposes of all penalties and remedies established
for violations of this paragraph, the prohibited activity
established herein as it applies to each such device shall be
deemed a separate violation.
* * * * * * *
(7) Notwithstanding any other investigative or enforcement
activities of any other Federal agency, the Commission shall
investigate alleged violations of this section and may proceed
to initiate action under section 503 of this Act to impose
forfeiture penalties with respect to such violation upon
conclusion of the Commission's investigation.
* * * * * * *