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 Federal  Communications  Commission  DA  00-  2168 
 FEDERAL  COMMUNICATIONS  COMMISSION 
 Washington,  D.  C.  20554 


 September  22,  2000 


 Mr.  Michael  Glover 
 Senior  Vice  President  &  Deputy  General  Counsel 
 Verizon  Communications,  Inc. 
 1310  North  Courthouse  Road    4  th  Floor 
 Arlington,  VA  22201 


 RE:  Bell  Atlantic/  GTE  Merger  Order,  CC  Docket  No.  98-  184,  ASD  File  No.  00-  30 
 Dear  Mr.  Ward: 
 This  letter  addresses  a  September  8,  2000  request  for  clarification  sought  by  Verizon 
 Communications,  Inc.  (  Verizon)  regarding  the  Merger  Conditions  adopted  in  the  Bell  Atlantic/  GTE 
 Merger  Order.  1  Specifically,  Verizon  seeks  a  clarification  of  the  companys  obligation  to  continue  to  make 
 available  unbundled  network  elements  (  UNEs)  in  accordance  with  certain  Commission  Orders.  2 
 In  the  Bell  Atlantic/  GTE  Merger  Order,  the  Commission  adopted  a  commitment  that  requires 
 Verizon  to  continue  to  make  available  UNEs  and  UNE  combinations  required  in  the  Local  Competition 
 Third  Report  and  Order  and  the  Line  Sharing  Order  in  accordance  with  those  Orders  until  the  date  of  a 
 final,  non-  appealable  judicial  decision.  3  In  the  Order,  the  Commission  explained  that  compliance  with  this 
 Merger  Condition  includes  pricing  UNEs  in  accordance  with  the  forward-  looking  cost  methodology 
 articulated  by  the  Commission  in  the  Local  Competition  Order.  4  In  that  Order,  the  Commission  adopted 
 the  total  element  long-  run  incremental  cost  (  TELRIC)  methodology.  Since  that  time,  Verizon  and  other 
 parties  have  contested  the  merits  of  the  TELRIC  pricing  methodology,  and  appeals  are  currently  pending.  5 


 In  its  letter,  Verizon  requests  clarification  concerning  the  effect  of  this  Merger  Condition  in  the 
 event  the  Supreme  Court  issues  a  ruling  that  vacates  the  TELRIC  rules  established  in  the  Local 
 Competition  Order.  In  particular,  Verizon  asserts  that  the  Merger  Conditions  do  not  establish  an 
 independent  basis  for  requiring  Verizon  to  use  the  TELRIC  pricing  methodology  in  the  event  the  Supreme 
 Court  finds  that  it  is  inconsistent  with  the  law  of  the  land.  6 


 1  GTE  Corporation,  Transferor,  and  Bell  Atlantic  Corporation,  Transferee,  For  Consent  to  Transfer  Control  of 
 Domestic  and  International  Sections  214  and  310  Authorizations  and  Application  to  Transfer  Control  of  a 
 Submarine  Cable  Landing  License,  Memorandum  Opinion  and  Order,  FCC  00-  221  (rel.  Jun.  16,  2000)  (  Bell 
 Atlantic/  GTE  Merger  Order).  The  Merger  Conditions  are  contained  in  Appendix  D.  2 


 See  Letter  from  Michael  E.  Glover,  Senior  Vice  President  &  Deputy  General  Counsel,  Verizon  Communications, 
 Inc.  to  Dorothy  T.  Attwood,  Chief,  Common  Carrier  Bureau,  FCC  (Sept.  8,  2000)  (  Verizon  Letter).  3 
 Bell  Atlantic/  GTE  Merger  Order  at  Appendix  D,  para.  39.  4 
 See  id.  at  para.  316.  5 
 See  Iowa  Util.  Bd.  v.  FCC,  219  F.  3d  744  (8  th  Cir.  2000),  petition  for  stay  filed.  6 
 See  Verizon  Letter  at  1-  2. 
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 Federal  Communications  Commission  DA  00-  2168 
 2 
 The  Merger  Conditions  require  Verizons  incumbent  local  exchange  carriers  (  LECs)  to  comply 
 with  certain  Commission  rules  until  the  date  of  any  final  and  non-  appealable  judicial  decision  7 
 concluding  the  litigation  concerning  those  rules  by  invalidating  them.  The  relevant  final  and  non-appealable 
 judicial  decision,  for  purposes  of  the  obligation  to  follow  the  TELRIC  pricing  rules  (as 
 opposed  to  the  obligation  to  follow  the  substantive  rules  in  the  Local  Competition  Third  Report  and  Order 
 and  the  Line  Sharing  Order),  would  be  a  final  decision  of  the  Supreme  Court  concluding  the  TELRIC 
 litigation  either  by  denying  certiorari  outright  or  by  invalidating  given  pricing  rules  on  the  ground  that  they 
 are  inconsistent  with  the  Telecommunications  Act  of  1996  or  the  Constitution.  In  the  event  of  such  a 
 decision,  the  Merger  Conditions  would  not  independently  impose  an  obligation  to  follow  any  finally 
 invalidated  pricing  rules  after  the  conclusion  of  that  litigation. 


 Please  do  not  hesitate  to  contact  me  if  I  can  be  of  further  assistance.  You  may  also  contact 
 Anthony  Dale  in  the  Common  Carrier  Bureau  at  (202)  418-  2260  for  further  information  on  this  matter. 


 Sincerely, 
 Dorothy  T.  Attwood 
 Chief,  Common  Carrier  Bureau 


 CC: 
 Mr.  Jeffrey  Ward,  Corporate  Compliance  Officer 


 7  Bell  Atlantic/  GTE  Merger  Order  at  para.  316;  see  id.  at  Appendix  C,  para.  39. 
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