DA 02-1259

May 28, 2002

# APPLICATION OF AMERICATEL CORPORATION AND TELECOM ITALIA OF North America, INC. TO MODIFY REGULATORY CLASSIFICATION FROM DOMINANT TO NON-DOMINANT ON THE U.S.-BRAZIL ROUTE

**Pleading Cycle Established**

**ITC-MOD-20020508-00243 (Telecom Italia of North America, Inc.);**

**ITC-MOD-20020508-00244 (Americatel Corporation)**

**Comments/Petitions Due: June 28, 2002**

**Responses/Oppositions Due: July 15, 2002**

Americatel Corporation and Telecom Italia of North America, Inc.
(collectively, "Petitioners") have filed a petition to modify their
status from dominant to non-dominant for the provision of international
services on the U.S.-Brazil route. In addition, Petitioners request that
the Commission remove Petitioners' foreign affiliate, Brasil Telecom
S.A. ("Brasil Telecom"), from the Commission's *List of Foreign Carriers
that are Presumed to Possess Market Power in Foreign Telecommunications
Markets*.[^1]

Petitioners argue that they should be re-classified as non-dominant
because Brasil Telecom does not possess market power on the U.S.-Brazil
route.[^2] Petitioners argue that under the Commission's rules,[^3] they
should be presumptively classified as non-dominant because Brasil
Telecom holds less than a 50 percent share in the international
transport and local access markets in Brazil, and because of legal
prohibitions against Brasil Telecom's expansion into new markets.[^4]
Petitioners argue further that other factors indicate a lack of market
power, including Brasil Telecom's lack of bottleneck control of
international transmission facilities and services in Brazil, Brazil's
satisfaction of the Commission's benchmark settlement rate conditions,
and the absence of significant barriers to entry or expansion.

Petitioners argue that the information presented to support their
re-classification to non-dominant on the U.S.-Brazil route also
satisfies the Commission's standard for rebutting the presumption that
Brasil Telecom possesses sufficient market power in Brazil pursuant to
section 43.51 of the Commission's rules, 47 C.F.R. § 43.51.
Consequently, Petitioners also request that the Commission remove Brasil
Telecom from the list of foreign carriers that are presumed to possess
market power in foreign telecommunications markets.

Pursuant to Sections 1.415 and 1.419 of the Commission\'s rules, 47
C.F.R. §§ 1.415, 1.419, interested parties may file comments on or
before **June 28, 2002**, and reply comments on or before **July 15,
2002**. Any filings should reference the file numbers of this
proceeding. **An original and four copies** of all pleadings must be
filed in accordance with Section 1.51(c) of the Commission's rules, 47
C.F.R. § 1.51(c).

**If filed by hand delivery,** the Commission\'s contractor, Vistronix,
Inc., will receive hand-delivered or messenger-delivered paper filings
for the Commission\'s Secretary at 236 Massachusetts Avenue, N.E., Suite
110, Washington, D.C. 20002. The filing hours at this location are 8:00
a.m. to 7:00 p.m. All hand deliveries must be held together with rubber
bands or fasteners. Any envelopes must be disposed of before entering
the building.

**If filed by mail, the following procedures should be followed:
Commercial Overnight Mail** (other than U.S. Postal Service Express Mail
and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol
Heights, MD 20743. **U.S. Postal Service first-class mail, Express Mail,
and Priority Mail** should be addressed to 445 12th Street, SW,
Washington, D.C. 20554. All filings must be addressed to the
Commission's Secretary, Office of the Secretary, Federal Communications
Commission.

**In addition, one copy of each pleading must be sent to each of the
following:**

The Commission's duplicating contractor, Qualex International, 445
12^th^ Street, S.W., Room CY-B402, Washington, D.C. 20554; e-mail:
qualexint@aol.com; facsimile: (202) 863-2898; phone: 202 863-2893.

(1) George Li, Policy Division, International Bureau, 445 12^th^ Street,
    S.W., Room 6-A761, Washington, D.C. 20554; e-mail: gli@fcc.gov;

(2) Claudia Fox, Policy Division, International Bureau, 445 12^th^
    Street, S.W., Room 6-A848, Washington, D.C. 20554; e-mail:
    cfox@fcc.gov;

(3) David Krech, Policy Division, International Bureau, 445 12^th^
    Street, S.W., Room 6-C848, Washington, D.C. 20554; e-mail:
    dkrech@fcc.gov;

(4) Mark Uretsky, Policy Division, International Bureau, 445 12^th^
    Street, S.W., Room 6-A814, Washington, D.C. 20554; email:
    muretsky@fcc.gov;

(5) David Strickland, Policy Division, International Bureau, 445 12^th^
    Street, S.W., Room 5-C848, Washington, D.C. 20554; e-mail:
    dstrickl@fcc.gov.

Copies of the Applications to Modify Regulatory Classification and any
subsequently filed documents in this matter are available for inspection
and duplication during regular business hours in the FCC Office of
Public Affairs Reference and Information Center, 445 12^th^ Street,
S.W., room CY-A257, Washington, D.C. 20554. Copies also may be obtained
from Qualex International, 445 12^th^ Street, S.W., room CY-B402,
Washington, D.C. 20554, (202) 863-2893.

This is a "permit but disclose" proceeding for purposes of the
Commission's *ex parte* rules. *See generally* 47 C.F.R. §§
1.1200-1.1216. As a "permit but disclose" proceeding, *ex parte*
presentations will be governed by the procedures set forth in section
1.1206 of the Commission's rules applicable to non-restricted
proceedings, 47 C.F.R. § 1.1206. Parties making oral *ex parte*
presentations are reminded that memoranda summarizing the presentation
must contain a summary of the substance of the presentation and not
merely a listing of the subjects discussed. More than a one or two
sentence description of the views and arguments presented is generally
required. *See* 47 C.F.R. § 1.1205(b)(2). Other rules pertaining to oral
and written presentations are set forth in section 1.1206(b) as well.

For further information, contact David Strickland, International Bureau,
at (202) 418-0977.

[^1]: List of Foreign Telecommunications Carriers that are Presumed to
    Possess Market Power in Foreign Telecommunications Markets, *Public
    Notice*, DA 99-809 (correction rel. June 18, 1999), at
    http://www.fcc.gov/Bureaus/International/Public_Notices/1999/da990809.txt.

[^2]: Pursuant to section 63.13 of the Commission rules, 47 C.F.R. §
    63.13, a carrier that seeks to modify its regulatory status from
    dominant to non-dominant on a particular route must provide
    information to demonstrate that it qualifies for non-dominant
    classification under to section 63.10 of the Commission rules, 47
    C.F.R. § 63.10.

[^3]: *See* 47 C.F.R. 63.10(a)(3).

[^4]: Petitioners allege that Brasil Telecom cannot offer inter-regional
    and international long distance service within its home region and
    cannot offer any type of fixed service outside its home region until
    December 31, 2003, unless it satisfies its network expansion and
    universal service targets prior to that date.