California Considers VoIP Deregulation

Regulation Watch

California Considers VoIP Deregulation

This article originally appeared in the October 2012 issue of INTERNET TELEPHONY

In recent years several states have enacted legislation deregulating VoIP services. Most recently, California is considering a bill that would likewise limit the state’s oversight of VoIP services. Under SB 1161, the California Public Utility Commission and other agencies and political subdivisions would largely be prohibited from regulating VoIP.

While removing authority to regulate many aspects of VoIP services, the California bill nonetheless allows for certain types of regulation. First, the law would not affect consumer universal service or E911 surcharges. Nor would it affect video franchising requirements under the Digital Infrastructure and Video Competition Act of 2006. California PUC would retain authority to enforce interconnection under Sections 251/252 of the Federal Communications Act, as well as the authority “to require data and other information” pursuant to the portion of the Utility Code governing ILEC forbearance petitions. The PUC also would maintain the authority to address intercarrier compensation disputes, and to enforce  backup power system requirements. The bill also makes clear that it would not affect the California PUC’s existing authority over other non-VoIP wireline or wireless services, and would not affect the enforcement of any state or federal criminal law or local ordinances of general applicability that apply to the conduct of business, the California Environmental Quality Act, or local utility user taxes. Unlike many other state VoIP deregulation laws, the California deregulation would last only until Jan. 1, 2020. 

While the legislation carves out a number of regulatory requirements that could still be applicable to VoIP, it would ensure that a number of other market entry requirements and other requirements applicable to traditional telephone providers would not become applicable to VoIP services in the state. If enacted, the California bill could become a model for other state legislation.

William B. Wilhelm (News - Alert) is a partner and Jeffrey R. Strenkowski is counsel at the global law firm of Bingham McCutchen LLP (

Edited by Brooke Neuman