Public Notice SCL00207

Action Taken Public Notice

Submarine Cable Landing

2017-12-21

FCC.report > IB > Public Notices > SCL00207

Filings Included

File Number	Service
SCL-LIC-20160906-00019	Submarine Cable Landing

IBFS_PN_1317184

SCL-LIC-20160906-00019 E Hawaiki Submarine Cable USA LLC
Submarine Cable Landing License
Grant of Authority Date of Action: 12/20/2017

Acceptability for Filing Public Notice: Application filed by Hawaiki Submarine Cable USA LLC (HSC USA), Tillamook Lightwave IGA
(Tillamook Lightwave), ACS Cable Systems, LLC (ACS), DRFortress, LLC (DRFortress), and the American Samoa Telecommunications
Authority (ASTCA) (collectively, the Applicants) for a license to land and operate a non-common carrier fiber-optic submarine cable between the
United States, Australia, and New Zealand, to be called the Hawaiki Cable System (Hawaiki). The Application was placed on Public Notice on
October 6, 2016. File No. SCL-LIC-20160906-00019, Public Notice, Streamlined Submarine Cable Landing License Applications Accepted for
Filing, Report No. SCL-00188S (IB, rel. Oct. 6, 2016). No comments or oppositions were filed in response to the Public Notice. On October
20, 2016, HSC USA filed an update to the application to reflect a new address for HSC USA. On July 28, 2017, Applicants were granted Special
Temporary Authority (STA) to begin constructing and testing the Hawaiki Cable System. SCL-STA-20170721-00018.

The Application has been coordinated with the Department of State and other Executive Branch agencies pursuant to section 1.767(b) of the
Commission's rules, 47 CFR §1.767(b), and consistent with procedures established with the Department of State. See Review of Commission
Consideration of Applications under the Cable Landing License Act, IB Docket No. 00-106, Report and Order, 16 FCC Rcd 22167, 22192-93,
paras. 51-52 (2001) (Submarine Cable Landing License Report and Order); Streamlined Procedures for Executive Branch Review of Submarine
Landing License Cable Landing License Requests, State Department Media Note (Revised) (rel. December 20, 2001) available at
http//www.state.gov/r/pa/prs/ps/2001/6951/htm. The Department of Homeland Security (DHS) filed a letter to defer action on October 6, 2016.
The Department of Justice (DOJ) also filed a letter to defer action on October 17, 2016. DHS, with the concurrence of DOJ and the Department
of Defense (DOD; collectively, the "Agencies"), filed a Petition to Adopt Conditions to Authorizations and Licenses on December 19, 2017. The
Agencies have no objection to the Commission approving authority to construct, land and operate the Hawaiki Cable System, provided that the
Commission conditions its approval on the commitment of Hawaiki Submarine Cable USA LLC to abide by the undertakings set forth in the
December 15, 2017, "Letter of Assurances" from Hawaiki Submarine Cable USA LLC to DHS and DOD.

Actions Taken: (1) Grant of Cable Landing License to Hawaiki Submarine Cable USA LLC, et al., for the purpose of landing and operating a
non-common carrier fiber-optic submarine cable system, connecting Sydney, Australia; Mangawhai Heads, New Zealand; Tafuna, American
Samoa; Kapolei, Oahu, Hawaii; and Pacific City, Oregon, and (2) grant of the Petition to Adopt Conditions to Authorizations and Licenses files
on December 19, 2017, by the Department of Homeland Security, with the concurrence of the Department of Justice and Department of Defense.

Licensee Information: The Applicants for the cable landing license for the Hawaiki cable system are the following: (1) Hawaiki Submarine Cable
USA LLC (HSC USA), (2) Tillamook Lightwave IGA (Tillamook Lightwave), (3) ACS Cable Systems, LLC (ACS), (4) DRFortress, LLC
(DRFortress), and (5) the American Samoa Telecommunications Authority.

HSC USA is a Delaware limited liability company, which is a direct wholly-owned subsidiary of Hawaiki Submarine Cable Limited Partnership
(HSC LP), a limited partnership organized under the laws of New Zealand. HSC LP is managed by Hawaiki Submarine Cable LP General
Partner, a New Zealand company. HSC LP is a direct wholly-owned subsidiary of HCL LP, a limited partnership organized under the laws of
New Zealand. HCL LP is managed by HCL LP General Partner, a New Zealand company. MD Fibre Trust holds a 44.58% interest in HCL LP.
HCL Founders LP owns 39.82% of HCL LP. The Galasso Family Trust has a 39.82% indirect ownership through its 100 percent ownership in
HCL Founders Trust. Sinclair Hawaiki LP holds a 15.6% interest in HCL LP. The Edgar Family Trusts, Sinclair Investments LP and SIL
Hawaiki Ltd hold an indirect 15.6% interest in HSC USA through Sinclair Hawaiki LP. No other person or entity has a 10 percent or greater
direct or indirect interest in HSC USA or HSC LP.

Tillamook Lightwave, an Oregon Revised Statues Chapter 190 Intergovernmental Agency, is owned by: (1) Tillamook County, 33.33%; (2) Port
of Tillamook Bay, an Oregon special district formed under ORS Chapter 777, 33.33%; and, (3) Tillamook People's Utility District, an Oregon
public utility district formed under ORS Chapter 261, owns 33.33% of Tillamook Lightwave. No other person or entity has a 10 percent or
greater direct or indirect interest in Tillamook Lightwave.

ACS, a Delaware limited liability company, is wholly-owned by Alaska Communications Systems Holdings, Inc., which in turn is wholly-owned
by Alaska Communications Systems Group, Inc., a Delaware corporation. Alaska Communications Systems Group, Inc. is a publicly traded,
widely held corporation in which no individual or entity holds a ten percent or greater interest.

DRFortress, a Delaware corporation, has the following 10 percent or greater direct or indirect interest holders: (1) Rosa White, a U.S. citizen,
directly owns 12.19%; (2) Alfred Rodi, a U.S. citizen, directly owns 12.10%; (3) Nathan Osada, a U.S. citizen, directly owns 10.60%; (4)
Jefferson Brown, a U.S. citizen, directly owns 12.10%; (5) Vinh Do, a U.S. citizen, directly owns 12.10%; (6) and Brent Oxley, a U.S. citizen,
directly owns 15% of DRFortress. No other person or entity has a 10 percent or greater direct or indirect interest in DRFortress.

ASTA is wholly-owned by the American Samoa Government.

Cable Design and Capacity: The Hawaiki cable system will have five segments and land in five locations. Segment 1 will connect Sydney,
Australia, and Mangawhai Heads, New Zealand, and will have one fiber pair with a total capacity of 12 terabits per second (Tbps). Segment 2
will connect Mangawhai Heads with Kapolei, Oahu, Hawaii, and will have one fiber pair with a total capacity of 10 Tbps. Segment 3 will
connect Sydney and Kapolei, and will have two fiber pairs with a capacity of 20 Tbps. Segment 4 will connect Kapolei with Pacific City,
Oregon, and have 3 fiber pairs with a total capacity of 30 Tbps. Segment 5 will connect a branching unit (BU) on the New Zealand to Hawaii
fiber pair to Tafuna, American Samoa, and will have 2 fiber pairs with a total capacity of 100-200 gigabits per second (Gbps). The primary
Network Operations Center (NOC) for Hawaiki will be located in New Zealand. The backup NOC will be subcontracted in the United States to a
U.S. operator.

Hawaiki's design provides the ability to install branching units and spurs to connect a number of Pacific Islands to the main trunk. The Pacific
Islands will be connected via Optical Add Drop Multiplexer (OADM) branching units located on the New Zealand to Hawaii fiber pair. With the
OADM technology, express wavelengths on all fiber pairs (Australia and New Zealand to the United States) will have no dependence on the
Pacific Islands. Given the requirements of the islands, the applicant intends to divert one or two wavelengths for an island (100 Gbps or 200
Gbps) with full upgrade capacity.
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Ownership of the Cable System and Landing Points: The main trunk of Hawaiki, between Australia and Oregon, will be 100% owned and
constructed by HSC LP, the direct parent of HSC USA. HSC LP and its affiliates will also own and/or control the cable landing stations in
Australia, New Zealand, Hawaii and Oregon. The landing station in Sydney will be leased from Equinix. HSC LP will build and own a new
landing station in Mangawhai Heads. HSC USA will build and own a new landing station in Kapolei. DRFortress will manage the landing
station in Hawaii under contract with HSC USA and will act as the landing party. HSC LP has entered into a contractual agreement with
Tillamook Lightwave to lease space in its existing landing station in Pacific City. ACS is under contract with HSC USA provide operation and
maintenance services for the Pacific City landing station. All of the capacity on the main trunk will be owned by HSC LP and its affiliates. HSC
LP will have control of the NOCs. DRFortress, Tillamook Lightwave and ACS will not own any capacity on Hawaiki.

ASTCA will own, construct and operate the spur connecting American Samoa to a branching unit on the Hawaiki submarine cable system.
ASCTA will also will own, construct and operate the cable landing station in Tafuna.

Regulatory Status of the Cable: Applicants state that Hawaiki will increase competition on U.S.-Australia-New Zealand routes and enhance the
service quality, redundancy, and resilience of communications systems in the region. Upon deployment, the applicants state that Hawaiki will
immediately and significantly increase regional and transpacific capacity, providing an alternative and diverse transmission route from the
mainland U.S. to Australia, New Zealand, Hawaii, and American Samoa.

The Applicants propose to operate Hawaiki on a non-common carrier basis. Applicants state there are a variety of competitive alternatives
including the PIPE Pacific Cable 1, Southern Cross and Telstra Endeavour cable systems, as well as the South-East Asia-United States system
currently under construction. Applicants also state that capacity on Hawaiki will either be used by the Applicants to meet their own internal
needs for bandwidth or made available to third parties on individually tailored agreements.

Applicants have provided information and demonstrated that the proposed operation of the cable on a non-common carrier basis satisfies the
requirements set forth in National Association of Regulatory Utility Commissioners v. FCC, 525 F.2d 630, 642 (D.C. Cir. 1976) (NARUC I),
cert. denied, 425 U.S. 992 (1976). See also Submarine Cable Landing License Report and Order, 16 FCC Rcd at 22202-22203, paras. 69-70;
Review of Commission Consideration or Applications under the Cable Landing License Act, IB Docket No. 00-106, Notice of Proposed
Rulemaking, 15 FCC Rcd 20789, 20815-20818, paras. 62-67 (2000).

Conditions and Requirements: Applicants shall comply with the routine conditions set forth in 1.767(g)(1)-(14) of the Commission rules, 47
C.F.R. § 1.767(g)(1)-(14), and with the requirements of section 1.768 of the Commission's rules, § 1.768 (Notification by and prior approval for
submarine cable landing licenses that are or propose to become affiliated with a foreign carrier).

We grant the Petition to Adopt Conditions to Authorizations and Licenses (Petition) filed in this proceeding on December 19, 2017 by the
Department of Homeland Security with the concurrence of the Department of Justice and Department of Defense. Accordingly, we condition
grant of this application on Hawaiki Submarine Cable USA LLC abiding by the commitments and undertakings contained in December 15, 2017
letter from Christophe Terral, Manager, Hawaiki Submarine Cable USA LLC to Assistant Secretary for Policy, DHS, the Department of Defense
Chief Information Officer, and the General Counsel, Defense Information Systems Agency (LOA). A failure to comply and/or remain in
compliance with any of these commitments and undertakings shall constitute a failure to meet a condition of the cable landing license and thus
grounds for declaring license terminated without further action on the part of the Commission. Failure to meet a condition of the license may
also result in monetary sanctions or other enforcement action by the Commission. A copy of the Petition and the LOA are publicly available and
may be viewed on the FCC website through the International Bureau Filing System (IBFS) by searching for SCL-LIC-20160906-00019 and
accessing "Other filings related to this application" from the Document Viewing area.

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Document Created: 2017-12-20 16:38:55
Document Modified: 2017-12-20 16:38:55

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