**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In re Application of             | * | CC Docket No. 98-184         |
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| GTE CORPORATION,                 | ) |                              |
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| Transferor,                      | * |                              |
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| BELL ATLANTIC CORPORATION,       | ) |                              |
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| Transferee                       | * |                              |
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| For Consent to Transfer Control  | * |                              |
| of Domestic                      | * |                              |
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| And International Section 214    | * |                              |
| and 310                          | * |                              |
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| Authorizations and Applications  | * |                              |
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| Landing License                  | * |                              |
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+----------------------------------+---+------------------------------+

ORDER

**Adopted:** September 26, 2001 **Released:** September 26, 2001

By the Chief, Common Carrier Bureau:

# Introduction

1.  On May 1, 2001, Verizon filed a letter with the Chief of the Common
    Carrier Bureau seeking permission to accelerate Verizon\'s right to
    provide advanced services without using its separate advanced
    services affiliate, Verizon Advanced Data, Inc. (VADI).[^1] Verizon
    states that expediting this sunset period is in the public interest
    because it will address a unique issue in one state, facilitate
    deployment of advanced services, and allow Verizon to compete fairly
    against its competitors.[^2] For the reasons explained below, we
    grant Verizon\'s request.

# BACKGROUND 

2.  To obtain Commission approval of their proposed merger, Bell
    Atlantic and GTE proposed several conditions designed to promote
    advanced services deployment, among other things. These conditions
    were adopted by the Commission on June 16, 2000 in the *Bell
    Atlantic-GTE Merger Order*.[^3] Included among these conditions was
    Bell Atlantic/GTE\'s agreement to offer advanced services through a
    separate affiliate until such time as provided for in the sunset
    provisions contained in the *Bell Atlantic-GTE Merger Order*.[^4]
    One of the three means by which Verizon\'s advanced services
    affiliate requirements would terminate automatically occurs nine
    months after the date upon which a final and non-appealable judicial
    decision determines that the separate advanced services affiliate is
    deemed a successor or assign of the incumbent, unless that decision
    is based substantially on conduct by or between Verizon and its
    affiliate that was not expressly permitted by these conditions.[^5]

3.  Verizon makes several arguments why accelerating the sunset of its
    advanced services affiliate is appropriate. According to Verizon\'s
    May 1^st^ letter, absent Commission action, it will soon be forced
    to turn away prospective digital subscriber loop (xDSL) customers in
    New Jersey. Unlike other state commissions in the Verizon region,
    the New Jersey Board of Public Utilities (NJ BPU) has not approved
    Verizon\'s application to transfer advanced services assets to its
    affiliate, VADI. Verizon argues that because of the NJ BPU\'s
    inaction, it is unable to purchase additional equipment to provide
    xDSL service to new customers served out of certain central offices.
    Verizon states that it is already out of capacity in two central
    offices and will be unable to fill customer orders in 70 others in
    the coming months.[^6]

4.  Verizon also argues that the separate advanced services affiliate
    requirement is hindering its deployment of new technology that would
    enable it to offer wholesale xDSL packet transport service to other
    carriers.[^7] According to Verizon, under the *Bell Atlantic-GTE
    Merger Conditions*,[^8] Verizon\'s incumbent local exchange carriers
    (LECs) are unable to procure, install, and test advanced services
    equipment (such as optical concentration devices and integrated
    xDSL-capable cards for remote terminals). It contends that the
    sooner its affiliate requirements terminate, the earlier its LECs
    will be able to install and test this equipment, and offer these
    services to carriers and retail customers.[^9] Finally, Verizon
    states that the structural separation requirement increases its
    costs of doing business and places Verizon at a competitive
    disadvantage relative to carriers such as AT&T and WorldCom.[^10]

5.  Only one commenter expressly opposes Verizon\'s request to terminate
    the nine-month sunset period;[^11] however, most commenters would
    like the Commission first to confirm Verizon\'s compliance with
    existing rules and conditions, impose new obligations on Verizon, or
    clarify Verizon\'s responsibilities in light of *ASCENT v.
    FCC*.[^12] Verizon disagrees with opening a proceeding to examine
    Verizon\'s obligations post-VADI reintegration, arguing that the
    *Bell Atlantic-GTE Merger Conditions* already establish such
    obligations.[^13] Moreover, Verizon opposes imposing new separation
    requirements on Verizon and also opposes investigating whether
    Verizon complies with its current affiliate responsibilities.
    According to Verizon, the Commission does not have the authority to
    re-impose separate affiliate requirements, and the results of a
    recent audit concerning Genuity have no bearing on how Verizon has
    interacted with VADI or how it will interact with its advanced
    services division after the sunset of the affiliate
    requirement.[^14] Finally, Verizon contends that many of the issues
    raised by commenters have either been considered and rejected or are
    pending before the Commission in other proceedings, and, thus, are
    inappropriate subjects for consideration in this proceeding.[^15]

# DISCUSSION

6.  We conclude that permitting Verizon to reintegrate VADI prior to the
    completion of the automatic sunset period is in the public interest
    and furthers the goal of promoting deployment of advanced services.
    Given the fact that Verizon has already expressed its intent to
    eliminate its separate affiliate at the end of the sunset period and
    commenters generally do not oppose its request to accelerate this
    reintegration, we see no reason to require Verizon to maintain a
    separate affiliate for the remaining several months, only to
    backtrack and begin the reintegration process, which Verizon
    estimates will take up to six months, immediately afterward. This
    seems unnecessarily costly and time-consuming for Verizon and its
    customers under the circumstances presented here. We therefore are
    persuaded that acceleration of the nine-month sunset provision is in
    the public interest.

7.  The standard for considering a change of merger conditions was
    stated most recently in the *Pronto Modification Order*.[^16] In
    considering Verizon\'s request, we will decide whether waiving the
    *Bell Atlantic-GTE Merger Conditions* in this limited manner is in
    the public interest, and whether this waiver is tailored in a way
    that affirmatively and identifiably promotes the underlying purpose
    of the condition.[^17] In the *Bell Atlantic-GTE Merger Order*, the
    Commission noted that the goal of establishing a separate advanced
    services affiliate was to promote equitable and efficient advanced
    services deployment.[^18] Specifically, the Commission found that
    the affiliate requirement will provide a \"structural mechanism to
    ensure that competing providers of advanced services receive
    effective, nondiscriminatory access to the facilities and services
    of the merged firm\'s incumbent LECs that are necessary to provide
    advanced services,\"[^19] and will \"greatly accelerate competition
    in the advanced services market by lowering the costs and risks of
    entry and reducing uncertainty, while prodding all carriers,
    including the Applicants, to hasten deployment.\"[^20]

8.  In the *Verizon May 1^st^ Letter* and reply comments, Verizon
    indicates that, due to unique circumstances, it is unable to offer
    xDSL services to certain prospective customers in New Jersey.[^21]
    No commenter disputes Verizon\'s characterization of the situation
    specific to New Jersey (*i.e.*, that Verizon cannot purchase new
    advanced services equipment to address capacity problems). Denying
    prospective customers the opportunity to purchase the xDSL service
    of one carrier clearly does not promote the goal of equitable and
    efficient deployment of advanced services.[^22] However, our
    determination that the reintegration of VADI prior to January 2002
    is in the public interest stretches beyond the confines of one state
    and, thus, we choose not to grant Verizon a waiver solely for New
    Jersey.

9.  Additionally, no commenter challenges Verizon\'s assertion that
    truncating the sunset period will enable its LECs to purchase,
    install, and test new technologies and next generation networks, and
    to make available to competitors advanced services enabled by this
    equipment.[^23] Thus, we also find that earlier deployment of next
    generation equipment, the resulting services of which will benefit
    competitors and consumers, is in the public interest and furthers
    the equitable and efficient deployment of advanced services goal
    that underlies the separate affiliate requirement.[^24] The two
    commenting equipment manufacturers, Alcatel and Catena, support this
    view, arguing that terminating the sunset period will result in
    faster deployment of integrated xDSL-capable cards, permitting a
    \"significant portion of the residential population \[to\] obtain
    competitive options for high speed services.\"[^25] Moreover, as
    discussed below,[^26] to ensure the continued equitable deployment
    of advanced services by competitors, the *Bell Atlantic-GTE Merger
    Conditions* apply operational safeguards to Verizon
    post-reintegration of VADI.[^27]

10. We also note that giving Verizon permission to reintegrate VADI
    immediately will enable competitors to negotiate and arbitrate with
    one carrier, not two. We understand the challenges to competitors,
    as were expressed by Sprint, of having to negotiate with and, if
    necessary, conduct two arbitrations against, two entities to obtain
    complete access to the network in Verizon territories.[^28] Once
    this Order becomes effective, we expect Verizon to negotiate and
    arbitrate immediately on behalf of itself and VADI to the extent it
    is permitted to do so under state law. We understand that Verizon
    must take interim steps before VADI is completely reintegrated.[^29]
    However, these procedural formalities should not slow a
    competitor\'s ability to deploy advanced services in states where
    Verizon is the incumbent or delay Verizon\'s provisioning of
    unbundled network elements and services to its wholesale
    customers.[^30]

11. As mentioned above, only ALTS opposes terminating the automatic
    nine-month sunset period.[^31] However, ALTS\'s opposition to
    Verizon\'s request is premised not on concerns about any public
    interest harm that may result from accelerating the sunset of VADI
    but, rather, on its belief that denying the request will \"send a
    clear message to the industry that the Commission will enforce all
    \[C\]ommission orders without exception.\"[^32] Other parties
    suggest that the Commission first confirm Verizon\'s compliance with
    existing rules and conditions, impose new conditions, or clarify
    previous Commission rulings before granting Verizon\'s request.[^33]
    For reasons discussed below, we decline to adopt these suggestions.

12. The Commission\'s authority to oversee and enforce Verizon\'s
    obligations under the *Bell Atlantic-GTE Merger Order*, and under
    all other applicable Commission orders and rules, continues. It does
    not cease simply because Verizon may offer advanced services through
    a separate corporate division rather than through a separate
    affiliate. The *Bell Atlantic-GTE Merger Conditions* provide that
    \"nothing in these Conditions shall relieve Bell Atlantic/GTE from
    the requirements of \[the Telecommunications Act of 1996 (1996
    Act)\] or those \[Commission or state decisions implementing the
    1996 Act\],\" a principle noted by AT&T in its comments.[^34] Thus,
    we find that there is no need to open a proceeding to review
    Verizon\'s compliance with its legal and regulatory obligations, as
    advocated by some commenters, because such an action simply would be
    duplicative.[^35] The Commission\'s review of such compliance is
    ongoing.[^36]

13. We also find it unnecessary to clarify Verizon\'s obligations or
    impose additional safeguards on Verizon post-reintegration of its
    advanced services affiliate in the manner requested by the
    commenters. Indeed, the *Bell Atlantic-GTE Merger Order* expressly
    contemplated this eventuality and created another regulatory
    framework to last until 48 months after the merger closing
    date.[^37] Namely, Verizon is required to provide:

    all advanced services through a separate office or division that
    will continue using the same OSS interfaces, processes and
    procedures that are made available to unaffiliated entities....In
    addition, \[Verizon\] will continue the surrogate line-sharing and
    advanced services OSS discounts, and its incumbent LECs will
    continue to provide unaffiliated carriers with the same \[operation,
    installation, and maintenance (OI&M)\] services that its retail
    operations use, as well as those OI&M services that previously were
    made available under the conditions.[^38]

    These provisions are clear and, with just two clarifications
    mentioned below,[^39] require no elaboration in this Order. Also,
    the requirements provide adequate assurance that Verizon will
    continue to provide nondiscriminatory access to the facilities and
    services required by competitors for their advanced services
    offerings. This language is responsive to WorldCom\'s concern about
    Verizon no longer offering a feature or service, process or
    procedure once VADI is reintegrated.[^40] Indeed, WorldCom states in
    its comments that \"even if the separate affiliate requirement is
    terminated, the Merger Conditions provide safeguards to ensure a
    level playing field for competitors.\"[^41] We agree. Moreover,
    Verizon has not sought relief from these provisions and they remain
    unaffected by the *ASCENT v. FCC* ruling. Finally, we expect that
    the continuing oversight and audit mechanisms will ensure that
    Verizon complies with the post-affiliate safeguards.[^42]

14. We recognize that VADI's reintegration will have an impact on the
    Carrier-to-Carrier Performance Plan established in the *Bell
    Atlantic-GTE Merger Conditions*.[^43] Specifically, Verizon's
    provision of advanced services, such as line sharing, to
    unaffiliated carriers is currently measured against Verizon's
    performance providing the same services to VADI.[^44] With VADI's
    reintegration, these measurements must be re-tooled. Therefore,
    Verizon should propose to the Chief of the Common Carrier Bureau new
    performance standards for the affected measurements within 30 days
    of this Order's release.

15. Several carriers urge the Commission to clarify Verizon\'s
    obligations to provide xDSL service for resale over resold lines
    pursuant to section 251(c)(4).[^45] The Commission did this in its
    July 20, 2001 order approving Verizon\'s application to offer
    interLATA telecommunications services in Connecticut pursuant to
    section 271 of the 1996 Act.[^46] Specifically, we concluded that
    Verizon must make available to resellers, at a wholesale discount,
    the same package of voice and xDSL services that it provides to its
    own retail end-user customers, and that this \"package\" includes
    xDSL service over lines on which the competitive LEC resells
    Verizon\'s voice service.[^47] Any concerns regarding Verizon\'s
    compliance with section 251(c)(4) may be addressed in a section 208
    formal complaint proceeding.[^48] Additionally, on July 6, 2001,
    Verizon requested Special Temporary Authority (STA) allowing it to
    cooperate with VADI to offer this service to competitors in
    Connecticut prior to the automatic termination of its affiliate
    requirements.[^49] The Commission sought and received comments on
    Verizon\'s request and granted the STA on July 19, 2001.[^50]
    Verizon sought and received similar authority to provide this same
    service in Pennsylvania.[^51] In approving Verizon\'s request to
    reintegrate VADI prior to the termination of the sunset period and
    consistent with our findings in the *Verizon Connecticut Order*, we
    determine that Verizon should immediately make available this
    service to competitors throughout its territory.

16. Finally, CompTel argues that the nine-month sunset period was
    designed to benefit the Commission by providing it with additional
    time during which to adopt clarifications or transitional
    requirements to protect competition and the public interest.[^52]
    CompTel cites no Commission authority for this argument, nor can
    it.[^53] The *Bell Atlantic-GTE Merger Order* is silent on this
    point. While CompTel\'s assertion has a superficial appeal, a more
    persuasive interpretation is that the sunset period was designed to
    allow Verizon adequate time to prepare, among other things, its
    systems, procedures and processes, address personnel matters and
    prevent customer disruption during this reintegration.[^54] The
    Commission has determined in this instance that it does not require
    additional time to \"adopt any further clarifications or
    transitional requirements,\"[^55] and that Verizon will make all
    necessary preparations to prevent customer disruptions.[^56] We do
    not establish a deadline in this Order by which Verizon must
    reintegrate VADI but, rather, we will leave it to Verizon\'s
    discretion to determine when it has completed the required steps to
    comply with its remaining advanced services obligations contained in
    the *Bell Atlantic-GTE Merger Conditions*. We expect that Verizon
    will promptly and expeditiously take the action outlined in its *ex
    parte* and will ensure that there is no customer disruption.
    Finally, Verizon shall immediately inform the Commission, in
    writing, when it completes its reintegration work for each state.

# ORDERING CLAUSES

17. Accordingly, IT IS ORDERED pursuant to sections 1-4, 201-205, 214,
    251, 303(r), and 309 of the Communications Act of 1934, as amended,
    and sections 0.91 and 0.291 of the Commission\'s rules, 47 U.S.C. §§
    151-154, 201-205, 214, 251, 303(r), and 309, and 47 C.F.R §§ 0.91
    and 0.291, that Verizon\'s May 1, 2001, request to accelerate the
    sunset of its advanced services affiliate IS GRANTED.

18. IT IS FURTHER ORDERED, pursuant to section 408 of the Communications
    Act of 1934, as amended, 47 U.S.C. § 408, that this Order is
    effective immediately upon release.

    FEDERAL COMMUNICATIONS COMMISSION

Dorothy T. Attwood

Chief

Common Carrier Bureau

[^1]: *See* Letter from Gordon R. Evans, Vice President, Federal
    Regulatory, Verizon to Dorothy Attwood, Chief, Common Carrier
    Bureau, CC Docket No. 98-184 (filed May 1, 2001) (*Verizon May 1^st^
    Letter*). In its letter, Verizon states that its separate advanced
    services affiliate requirement will terminate automatically no later
    than nine months after the *ASCENT v. FCC* decision. *Id.* at 1,
    citing *Assoc. of Communications Enter. v. FCC*, 235 F.3d 662 (D.C.
    Cir. 2001) (*ASCENT v. FCC*).

[^2]: The Commission requested and received comments on the *Verizon May
    1^st^ Letter*. *See* Pleading Cycle Established for Comments on
    Verizon\'s May 1^st^ Letter Concerning Relief from Bell Atlantic/GTE
    Merger Conditions, CC Docket No. 98-184, *Public Notice*, DA 01-1325
    (rel. May 31, 2001). The following parties submitted both comments
    and reply comments: AT&T Corp. (AT&T) and Competitive
    Telecommunications Association (CompTel). The Associations for Local
    Telecommunications Services (ALTS); Catena Networks, Inc. (Catena);
    and WorldCom, Inc. (WorldCom) filed comments. Alcatel USA, Inc.
    (Alcatel); ASCENT; Sprint Corporation (Sprint); and Verizon filed
    reply comments.

[^3]: *See Application of GTE Corporation and Bell Atlantic Corporation
    for Consent to Transfer Control of Domestic and International
    Sections 214 and 310 Authorizations and Applications to Transfer
    Control of a Submarine Cable Landing License*, 15 FCC Rcd at 14039,
    para. 5 (2000) (*Bell Atlantic-GTE Merger Order*).

[^4]: *See id.* at 14153, para. 265.

[^5]: *Id.* As applied to Verizon, the *ASCENT v. FCC* ruling holds that
    VADI is a successor or assign of Verizon. No commenter contests the
    applicability of the *ASCENT v. FCC* decision to Verizon and by our
    calculations, this merger condition will sunset automatically on
    January 9, 2002. *See* Sup. Ct. R. 13.

[^6]: *Verizon May 1^st^ Letter* at 1-2. In a letter filed on August 10,
    2001, Verizon states that nine New Jersey central offices are now
    closed to new xDSL orders and that ten more are expected to be
    closed over the next several weeks. Letter from Dee May, Executive
    Director, Federal Regulatory, Verizon to Magalie Roman Salas,
    Secretary, Federal Communications Commission, CC Docket No. 98-184,
    at 1 (filed August 10, 2001) (*Verizon Ex Parte*). Also in this
    letter, Verizon mentions that granting its request will alleviate
    the current anxiety experienced by its employees because of the
    uncertainty about what and where their jobs will be
    post-reintegration. *Id.* at 1-2. Moreover, it argues that promptly
    granting its request will permit it to begin immediately the
    reintegration process, a process it estimates will require up to six
    months. *Id.* at 2.

[^7]: *Verizon May 1^st^ Letter* at 2.

[^8]: *See* *Bell Atlantic-GTE Merger Order* at Appendix D, 15 FCC Rcd
    at 14265-89, paras. 1-12. We refer to the commitments contained in
    Appendix D of the *Bell Atlantic-GTE Merger Order* as \"*Bell
    Atlantic-GTE Merger Conditions*\" throughout this Order.

[^9]: *Verizon May 1^st^ Letter* at 2.

[^10]: *Id.* at 2-3. In its *ex parte*, Verizon again notes its
    difficulties in marketing its advanced services, especially for
    large customers. Specifically, it states that granting its
    reintegration request will allow for closer coordination in the
    provisioning and maintenance of complex service arrangements for
    these customers. *Verizon Ex Parte* at 2.

[^11]: *See* ALTS Comments at 1-2, 10-11 (arguing, among other things,
    that the results of a recent independent audit of Genuity, filed
    with the Commission on June 1, 2001, demonstrate Verizon\'s
    non-compliance with the *Bell Atlantic-GTE Merger Conditions*).

[^12]: *See, e.g.,* AT&T Comments at 5-7; CompTel Comments at 8-9;
    WorldCom Comments at 5.

[^13]: Verizon Reply at 2, citing *Bell Atlantic-GTE Merger Conditions*
    at para. 12.c.

[^14]: Verizon Reply at 3-4, 5.

[^15]: *Id.* at 6-7 (*e.g.*, AT&T\'s requests that Verizon provide xDSL
    services to Internet service providers at a wholesale discount, and
    that the Commission establish applicable rules where there is fiber
    in the local loop).

[^16]: *Applications of Ameritech Corp., Transferor, and SBC
    Communication Inc., Transferee, For Consent to Transfer Control of
    Corporations Holding Commission Licenses and Lines Pursuant to
    Sections 214 and 310(d) of the Communications Act and Parts 5, 22,
    24, 25, 63, 90, 95 and 101 of the Commission\'s Rules*, CC Docket
    No. 98-141, *Second Memorandum Opinion and Order*, 15 Rcd at 17532,
    para. 21 (2000) (*Pronto Modification Order*).

[^17]: *Id*.

[^18]: *Bell Atlantic-GTE Merger Order*, 15 FCC Rcd at 14145, para. 251.

[^19]: *Id.*, 15 FCC Rcd at 14149, para. 261.

[^20]: *Id.*, 15 FCC Rcd at 14149-50, para. 262.

[^21]: *See Verizon May 1^st^ Letter* at 1-2, Dowell Decl. at paras.
    3-7; Verizon Reply at 1-2.

[^22]: *See Bell Atlantic-GTE Merger Order*, 15 FCC Rcd at 14145, para.
    251.

[^23]: *Verizon May 1^st^ Letter* at 2*.* Verizon mentions several times
    in its filings that the separate affiliate requirement places it at
    a competitive disadvantage by, among other things, increasing its
    costs of doing business. *Id.* at 2-3; Verizon Reply at 2. Although
    we recognize the added complexity and costs of maintaining a
    separate affiliate to offer a particular type of service, we also
    note that Verizon has benefited from efficiencies resulting from the
    merger of Bell Atlantic and GTE - benefits it neglects to mention or
    quantify. For example, for the period up to the *ASCENT v. FCC*
    decision, Verizon\'s incumbent LECs were free of advanced services
    resale obligations. Accordingly, we cannot rely on Verizon\'s
    assertions of being competitively disadvantaged as a result of the
    separate affiliate requirement as support for its request to
    terminate the sunset period. Since we do not afford any weight to
    this Verizon assertion, we also choose not to rely on ALTS\'s
    arguments contesting Verizon\'s claims of economic hardship. *See*
    ALTS Comments at 7.

[^24]: *Bell Atlantic-GTE Merger Order*, 15 FCC Rcd at 14145, para. 251.

[^25]: *See* Alcatel Reply at 2-3; Catena Comments at 1.

[^26]: *See* para. 13, *infra*.

[^27]: *See Bell Atlantic-GTE Merger Conditions*, 15 FCC Rcd at 14289,
    para. 12 (*e.g.*, requiring Verizon to establish a separate office
    or division for the provision of advanced services, maintaining line
    sharing and advanced services OSS discounts). The post-affiliate
    requirements are supposed to achieve the key reasons for the
    affiliate, *i.e.*, ensure nondiscriminatory access to essential
    inputs.

[^28]: Sprint Reply at 4.

[^29]: *See* *Verizon Ex Parte* at 2 (stating, among other things, that
    it must obtain state approvals to transfer intrastate assets back to
    Verizon).

[^30]: As indicated in its *ex parte*, Verizon anticipates that the
    state regulatory approval process for reintegrating VADI will
    require up to six months to complete and that this state process
    cannot begin until Verizon receives the Commission\'s approval to
    reintegrate VADI on an expedited basis. *Verizon Ex Parte* at 2.
    Thus, the practical effect of granting Verizon\'s request to
    accelerate the nine-month sunset period is to permit Verizon to
    obtain the necessary state approvals by the approximate date this
    automatic nine-month period is scheduled to expire, or January 2002.

[^31]: ALTS Comments at 1-2, 11.

[^32]: *Id.* at 3. According to ALTS, \"any move to side-step the
    conditions, would, by the Commission\'s own words, *not* be in the
    public interest . . . .\" *Id*. at 5, citing *Bell Atlantic Merger
    Order* at paras. 3, 4. We disagree with ALTS\'s strict
    interpretation of our *Bell Atlantic-GTE Merger Order*, *i.e.*, that
    *any* modification to the *Bell Atlantic-GTE Merger Conditions*
    results in harm to consumers. Such a view is clearly at odds with
    the express language of the *Bell Atlantic-GTE Merger Order*, which
    provides that the Commission may, at its discretion and subject to
    its normal procedures, modify these conditions. *See Bell
    Atlantic-GTE Merger Order*, 15 FCC Rcd at 14194, para. 345, citing
    47 U.S.C. §§ 316, 416(b).

[^33]: *See, e.g.,* AT&T\'s request that Verizon provide a complete
    description of its next generation plans and allow competitors
    access to the functionality of Verizon\'s entire loop at cost-based
    rates; CompTel\'s suggestion that the Commission clarify its line
    splitting rules; WorldCom\'s request that competitors be allowed to
    participate in Verizon\'s planning and testing processes for
    advanced services. *See* AT&T Comments at 5-7; CompTel Comments at
    8-9; WorldCom Comments at 5. We find that Verizon\'s reintegration
    request is not the appropriate vehicle to clarify rulings that are
    the subject of proceedings pending before the Commission. *See,*
    *e.g.,* AT&T\'s request to \"make clear the legal principles that
    apply when ILECs build-out next generation loop architecture.\" AT&T
    Comments at 5, 6-7. Commenters also argue that Verizon first must
    demonstrate its compliance with its separate affiliate requirements.
    *See, e.g.,* *id.* at 6; CompTel Comments at 4; WorldCom Comments at
    4.

[^34]: *See Bell Atlantic-GTE Merger Conditions*, 15 FCC Rcd at 14262,
    n.2; *see also,* AT&T Comments at 3 (stating that \"no waiver of the
    merger conditions can alter Verizon\'s statutory obligations.\");
    *Bell Atlantic-GTE Merger Conditions*, 15 FCC Rcd at 14329, para. 58
    (providing that the enforcement mechanisms established therein do
    not abrogate, supersede, limit or otherwise replace the
    Commission\'s powers under the Communications Act of 1934, as
    amended).

[^35]: *See, e.g.,* ALTS Comments at 6; CompTel Comments at 4; WorldCom
    Comments at 4; AT&T Reply at 7. We therefore disagree with ALTS\'s
    suggestion that the results of an audit of Genuity are relevant to
    Verizon\'s request to reintegrate VADI prior to the nine-month
    sunset period. *See* ALTS Comments at 9-11. Any non-compliance of
    the *Bell Atlantic-GTE Merger Conditions* will be addressed in the
    appropriate forum.

[^36]: ALTS\'s inference that granting Verizon\'s limited request means
    that the Commission is failing to enforce its orders is simply
    incorrect. *See* ALTS Comments at 3. As ALTS understands, a court of
    competent jurisdiction determined that VADI is a successor or assign
    of Verizon. Pursuant to the *Bell Atlantic-GTE Merger Order*,
    Verizon may elect to reintegrate VADI nine months after the *ASCENT
    v. FCC* ruling becomes final and non-appealable. The question
    presented by Verizon to us in the instant proceeding is whether
    implementation of the court\'s ruling should be accelerated.

[^37]: *Bell Atlantic-GTE Merger Order*, 15 FCC Rcd at 14153, para. 266.

[^38]: *Id.*; *see* *also, Bell Atlantic-GTE Merger Conditions*, 15 FCC
    Rcd at 14289, para. 12. We find that this language addresses
    CompTel\'s concern about the status of discount rates
    post-reintegration of VADI into Verizon. *See* CompTel Comments at
    5.

[^39]: *See* paras. 14, 15, *infra*.

[^40]: *See* WorldCom Comments at 5. Similarly, WorldCom\'s request to
    make explicit Verizon\'s duty to negotiate in good faith also is
    unnecessary. *Id*. Verizon is obliged to do so pursuant to 47 U.S.C.
    § 251(c)(1).

[^41]: *Id.*

[^42]: *See, e.g., Bell Atlantic-GTE Merger Conditions*, 15 FCC Rcd at
    14326-29, paras. 55-7 (establishing audit requirements).

[^43]: *See Bell Atlantic-GTE Merger Conditions*, 15 FCC Rcd at
    14333-14431, Attachment A.

[^44]: *See, e.g.,* Letter from Dee May, Executive Director, Federal
    Regulatory, Verizon to Magalie Roman Salas, Secretary, Federal
    Communications Commission, ASD File No. 00-30 (filed August 14,
    2000). *See also*, Letter from Carol E. Mattey, Deputy Chief, Common
    Carrier Bureau to Jeff Ward, Senior Vice President - Regulatory
    Compliance, Verizon, DA 00-1872 (rel. Sept. 19, 2000).

[^45]: *See* 47 U.S.C. § 251(c)(4); *see also*, AT&T Comments at 4, 8;
    CompTel Comments at 5; ASCENT Reply at 7.

[^46]: *See* *Application of Verizon New York, Inc. Verizon Long
    Distance, Verizon Enterprise Solutions, Verizon Global Networks
    Inc., and Verizon Select Services Inc., for Authorization to Provide
    In-Region, InterLATA Services in Connecticut*, CC Docket No. 01-100,
    *Memorandum Opinion and Order*, FCC 01-208, at paras. 27-33 (rel.
    July 20, 2001) (*Verizon Connecticut Order*); *see also*, 47 U.S.C.
    § 271.

[^47]: *Verizon Connecticut Order* at paras. 28, 30.

[^48]: *See* 47 U.S.C. § 208.

[^49]: *See* Letter from Dee May, Executive Director, Federal
    Regulatory, Verizon to Dorothy Attwood, Chief, Common Carrier
    Bureau, CC Docket No. 98-184 (filed July 6, 2001).

[^50]: *See* Comments Requested in Connection with Verizon\'s 271
    Application for Connecticut, CC Docket No. 01-100, *Public Notice*,
    DA 01-1609 (rel. July 6, 2001); *see also,* *Application of GTE
    Corporation and Bell Atlantic Corporation for Consent to Transfer
    Control of Domestic and International Sections 214 and 310
    Authorizations and* Applications *to Transfer Control of a Submarine
    Cable Landing License*, CC Docket No. 98-184, DA 01-1717 (rel. July
    19, 2001).

[^51]: *See* Letter from Dee May, Executive Director, Federal
    Regulatory, Verizon to Dorothy Attwood, Chief, Common Carrier
    Bureau, CC Docket No. 98-184 (filed July 10, 2001); *see also,
    Application of GTE Corporation and Bell Atlantic Corporation for
    Consent to Transfer Control of Domestic and International Sections
    214 and 310 Authorizations and* Applications *to Transfer Control of
    a Submarine Cable Landing License*, CC Docket No. 98-184, DA 01-2039
    (rel. August 31, 2001). We believe that the Commission\'s inquiry on
    Verizon\'s proposed offering in Connecticut and Pennsylvania and our
    findings in the *Verizon Connecticut Order* demonstrate that this
    Verizon offering satisfies its section 251(c)(4) obligations and are
    responsive to CompTel\'s and AT&T\'s request to seek comment on
    Verizon\'s compliance with its xDSL resale obligations post-*ASCENT
    v. FCC*. *See* CompTel Comments at 5; AT&T Reply at 3. In addition,
    because we believe it is outside the scope of this proceeding, we
    will not act on CompTel\'s request to direct Verizon to make its
    xDSL resale performance part of an OSS test. *See* CompTel Comments
    at 9 (stating that SBC/Ameritech has argued that xDSL resale should
    not be a part of any third-party OSS test); AT&T Reply at 4.

[^52]: CompTel Comments at 4.

[^53]: In fact, the cite CompTel does provide further supports our
    earlier statements regarding our ever-present enforcement authority:
    \"We intend to utilize every available enforcement mechanism. . . to
    ensure compliance with these \[merger\] conditions.\" *Id.*, quoting
    *Bell Atlantic-GTE Merger Order*, 15 FCC Rcd at 14146-47, para. 256.

[^54]: In the *Bell Atlantic-GTE Merger Order*, the Commission allowed
    Verizon to \"ease the transition to providing all advanced services
    through a separate affiliate\" by permitting it to perform certain
    activities on behalf of its affiliate during the transition period.
    *See Bell Atlantic-GTE Merger Order*, 15 FCC Rcd at 14152-53, para.
    264. The Commission also expressed concern that if the transition
    period was not managed properly, existing advanced services
    customers could experience uncalled-for disruption of service. *Id.*
    It is clear from this language that the purpose of the initial
    transition period was to benefit not the Commission but, rather,
    Verizon and its customers. Similarly, the nine-month sunset period
    should assist Verizon, VADI and their customers.

[^55]: *See* CompTel Comments at 4.

[^56]: *See Verizon Ex Parte* at 3 (indicating that it does not
    anticipate any significant customer disruption because its separate
    advanced services office or division will continue to use the
    systems developed by VADI to provide xDSL service).