RESTRICTEDWORLD TRADE
ORGANIZATIONGPA/W/100/Add.1
14 January 2000
(00-0158)
Committee on Government Procurement Original:  English
QUESTIONS TO JAPAN RELATING TO NTT
Communication from the United States
Addendum
The following communication, dated 12 January 2000, has been received from the Permanent
Mission of the United States with the request that it be circulated to the Committee on Government
Procurement.
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Please find below a second set of questions from the United States to Japan regarding its
notification to the Committee on the reorganization of NTT (GPA/W/91).
1. Were NTT East, NTT West and NTT Communications organized under the same provision of
the Commercial Law?  Please provide the relevant cite to the Commercial Law.
2. If, as Japan has stated in response to US Question 21, NTT East and NTT West are "private
companies under the Japanese Commercial Law", and Japan acknowledges that those regionalcompanies are included in GPA coverage, why does Japan claim that NTT Communications' status as
a private company under the Commercial Law is the basis for excluding it from GPA coverage?
3. Japan has referred to NTT East and NTT West as "special companies".  What makes them
special companies?
4. Does NTT Communications enjoy any tax benefits, other than those referenced in Japan's
response to US Question 5(c), that are not normally provided to all private sector companies in the
telecommunications sector in Japan?  Are all of the tax benefits given to NTT Communications
temporary?  Please provide information as to when each tax benefit was, or will be, terminated.
5. Under the new NTT structure, can any revenues or other funds generated by business
activities of NTT Holding Company or any other NTT group company be transferred to NTT
Communications?  If so, please describe under what circumstances and for what purposes?
6. Under the new NTT structure, can the Government of Japan or NTT Holding Company
require or recommend that revenues generated by NTT Communications' business activities be
transferred to NTT Holding Company or any other NTT group company?
                                                     
1 All questions refer to the United States "Questions to Japan Relating to NTT", circulated in document
GPA/W/100, dated 16 November 1999.GPA/W/100/Add.1
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7. In raising funds for investments or other business activities, is NTT Communications entitled
to, or can it benefit from, any financial guarantees provided by NTT Holding Company or the
Government of Japan which are not available to all private sector companies in the
telecommunications sector in Japan?  If so, under what circumstances and for what purposes?
8. Does NTT Communications use, have access to, or have the right to use any buildings,
equipment, or other facilities used by the NTT Holding Company, NTT East or NTT West?  If so,
please describe.
9. With respect to the statement, included in a document available on the NTT website that NTT
Holding Company will "advise and instruct group companies regarding basic procurement and supply
strategies", please explain in detail what type of control NTT Holding Company could exert, or isexpected to exert, over NTT Communications' procurement strategies and plans, and what type of
advice or instructions NTT Holding Company may give NTT Communications with regard to its
procurement strategies and plans.
10. In its April 1999 reply to the NTT Restructuring Plan, MPT indicated that there were aspects
of the relationship between the NTT entities after the restructuring that MPT would continue to
monitor.  These included disclosure of information on R&D activities, personnel exchanges, and the
sale of long-distance services by NTT East and NTT West.  What is the Japanese Government doing
to fulfill this commitment?
11. Does NTT Communications benefit from any preferential access to local networks, including
networks owned by NTT East and NTT West, or from  any other preferential treatment that is not
provided on the same basis to all private sector companies in the telecommunications sector in Japan?
Does NTT Communications benefit from any other "s pecial or exclusive" rights granted by the
Government of Japan?
12. What is NTT Communications' current share of the long-distance market in Japan?  What is
the market share of each of NTT Communications' principal competitors in this market?
13. What business activities, other than the business activities listed by Japan in its response to
US Question 1, is NTT Communications responsible for or engaged in?
14. In its response to US Question 4, Japan claims that NTT Communications engages in business
activities under the Telecommunications Business Law under the same conditions "as for all other
telecommunications carriers, which are not under government control or influence".  Please provide a
list of all these telecommunications carriers.
15. Japan claims in its response to US Question 5(b) that the provisions exempting NTT
Communications from the Commercial Law were necessary "in order to maintain financial soundness
and smooth implementation of reorganization".  Pleas e explain in detail how the exemptions achieved
these goals.
(a) Were these exemptions applied to NTT East and NTT West?  If not, why not?  If so,
do they apply to NTT East and NTT West at present?
16. Please provide a list of the "New Common Carriers" referred to by Japan in its response to
US Question 11.
17. Please explain in detail how the Government of Japan exercises its shareholders' rights in the
NTT Holding Company.  For example, does it attend all shareholders' meetings?  Does it vote at such
meetings?  If so, does it ever abstain or not vote on particular issues?  If so, what types of issuesGPA/W/100/Add.1
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would it vote on and/or not vote on?  Is the Mini stry of Finance the only entity within the Japanese
Government that has the right to exercise sharehol ders' rights in the NTT holding company?  Please
provide copies of any Japanese regulations or policies that govern how and when the GOJ can vote as
a shareholder and which GOJ entity is empowered to exercise these shareholders' rights.
18. Please provide a copy of the NTT Law, all amendments to the law, and all Supplemental
Provisions of the law, in both Japanese and English, including their official cites.
(a) Please indicate any provisions of the Law and Supplemental Provisions that are no
longer in effect.
(b) Please give pertinent documents related to the legislative history of the law in both
Japanese and English, including previous versions of the law.
19. In order to clarify the chart provided by Japan on 15 December 1999, entitled "Procurement
by NTT Beyond the Threshold", and the data upon which it is based, please provide responses to the
following:
(a) Is it correct that the data covers the 1997 Japanese Fiscal Year?(b) During that time-period, were NTT's long-distance business activities conducted by a
separate business entity or unit within NTT?  If so, were procurement statistics forthat entity or unit kept separately from procurement statistics of other NTT business
activities?  To what extent did the business activities of that entity or unit correspond
with NTT Communications' current business activities?
(c) Does the chart include only the NTT procurements that the Government of Japan
considers to have been covered by the GPA during the 1997 Japanese Fiscal Year?
(d) Please provide a list of all the major categories of goods and services procured by
NTT as part of its long-distance business activities during the 1997 Japanese Fiscal
Year that are included in the procurement data on which the chart is based, together
with the value of procurement conducted within each category.
(e) Please provide a list of all the major categories of goods and services procured by
NTT as part of its long-distance business activities during the 1997 Japanese Fiscal
Year that are not included in the data on which the chart is based, including the value
of procurements conducted in those categories.
(f) In compiling the data on which the chart is based, did Japan exclude any
procurements on the basis of any of the Notes to Japan's Annex 3 to the GPA?  If so,
please describe and provide detailed statistics on the nature and value of
procurements so excluded.
(g) Based on NTT Communications' current business plan, please provide a detailed
explanation of any significant differences that are likely to exist between the
procurements for NTT's long-distance business activities reflected in the above data
and NTT Communications' expected procurements in the next five Japanese fiscal
years (2000-2004).  Please provide details on any such differences, both in terms ofthe types of goods and services to be procured and the value of those procurements.GPA/W/100/Add.1
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(h) Please provide detailed statistics, broken down by goods and services categories, on
NTT's total procurements (i.e., regardless of GPA coverage) during the last five years
for which data are available.
(i) Please provide the information set out in the chart for the 1998 Japanese Fiscal Year.
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