Sec.  51.707   Default proxies for incumbent LECs' transport and termination rates.

   (a) A state commission may determine that the cost information available to
   it with respect to transport and termination of telecommunications traffic
   does not support the adoption of a rate or rates for an incumbent LEC that
   are consistent with the requirements of  Sec.  Sec. 51.505 and 51.511. In that event,
   the state commission may establish rates for transport and termination of
   telecommunications traffic, or for specific components included therein,
   that are consistent with the proxies specified in this section, provided
   that:

   (1) Any rate established through use of such proxies is superseded once that
   state commission establishes rates for transport and termination pursuant to
    Sec.  Sec. 51.705(a)(1) or 51.705(a)(3); and

   (2) The state commission sets forth in writing a reasonable basis for its
   selection of a particular proxy for transport and termination of
   telecommunications traffic, or for specific components included within
   transport and termination.

   (b) If a state commission establishes rates for transport and termination of
   telecommunications traffic on the basis of default proxies, such rates must
   meet the following requirements:

   (1) Termination. The incumbent LEC's rates for the termination of
   telecommunications traffic shall be no greater than 0.4 cents ($0.004) per
   minute, and no less than 0.2 cents ($0.002) per minute, except that, if a
   state commission has, before August 8, 1996, established a rate less than or
   equal to 0.5 cents ($0.005) per minute for such calls, that rate may be
   retained pending completion of a forward-looking economic cost study.

   (2) Transport. The incumbent LEC's rates for the transport of
   telecommunications traffic, under this section, shall comply with the
   proxies described in  Sec. 51.513(c) (3), (4), and (5) of this part that apply to
   the analogous unbundled network elements used in transporting a call to the
   end office that serves the called party.

   [ 61 FR 45619 , Aug. 29, 1996, as amended at  61 FR 52709 , Oct. 8, 1996]