II

106TH CONGRESS

1ST SESSION S. 1312

To ensure full and expeditious enforcement of the provisions of the Communications Act of 1934 that seek to bring about competition in local

telecommunications markets, and for other purposes.

IN THE SENATE OF THE UNITED STATES

JULY 1, 1999

Mr. HOLLINGS introduced the following bill; which was read twice and

referred to the Committee on Commerce, Science, and Transportation

A BILL

To ensure full and expeditious enforcement of the provisions

of the Communications Act of 1934 that seek to bring

about competition in local telecommunications markets,

and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Telecommunications

5 Competition Enforcement Act of 1999’’.

6 SEC. 2. FINDINGS.

7 The Congress finds:
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1 (1) The Telecommunications Act of 1996 put in

2 place the proper framework to achieve competition in

3 local telecommunications markets.

4 (2) The Telecommunications Act of 1996 re5 quired that all incumbent local exchange carriers

6 open their markets to competition by interconnecting

7 with and providing network access to new entrants,

8 a process to be overseen by Federal and State regu9 lators.

10 (3) To increase the incentives of the Bell oper11 ating companies to open their local networks to com12 petition, the Telecommunications Act of 1996 allows

13 the Bell operating companies to provide interLATA

14 long distance service in their service region only

15 after opening their local networks to competition.

16 (4) While significant progress has been made in

17 opening local telecommunications markets, 3 years

18 after passage of the Act, not a single Bell operating

19 company has opened its network to competition as

20 required by the Telecommunications Act of 1996.

21 (5) It is apparent that the incumbent local ex22 change carriers do not have adequate incentives to

23 cooperate in this process and that regulators have

24 not exercised their enforcement authority to require

25 compliance.
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1 (6) By improving mandatory penalties on Bell

2 operating companies and incumbent telephone com3 panies that have not opened their network to com4 petition, there will be greater assurance that local

5 telecommunications markets will be opened more ex6 peditiously and, as a result, American consumers

7 will obtain the full benefits of competition.

8 SEC. 3. PURPOSE.

9 The purpose of this Act is to impose penalties on tele10 phone companies that have not complied with the Tele11 communications Act of 1996 in order to ensure that local

12 telecommunications markets are opened more rapidly to

13 full, robust, and sustainable competition.

14 SEC. 4. ENFORCEMENT AUTHORITY.

15 Title 2 of the Communications Act of 1934 (47

16 U.S.C. 201 et seq.) is amended by adding at the end the

17 following new section:

18 ‘‘SEC. 262. ENFORCEMENT AUTHORITY.

19 ‘‘(a) IN GENERAL.—

20 ‘‘(1) If the Commission finds that a Bell oper21 ating company has not fully implemented the com22 petitive checklist in section 271(c)(2)(B) for all tele23 communications (including voice, video, and data)

24 for at least one-half of the States in its region by

25 February 8, 2001, as determined by the Commission
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1 under Commission policies adopted as of June 1,

2 1999, the Commission shall assess on such company

3 a forfeiture penalty of $100,000 for each day of the

4 continuing violation until the Commission deter5 mines that the Bell operating company has fully im6 plemented section 271(c)(2)(B).

7 ‘‘(2) If the Commission finds that a Bell oper8 ating company has not fully implemented the com9 petitive checklist in section 271(c)(2)(B) for all tele10 communications (including voice, video, and data) in

11 all States in its region by February 8, 2003, as de12 termined by the Commission under Commission poli13 cies adopted as of June 1, 1999, the Commission

14 shall order the Bell operating company to divest

15 itself of its telecommunications network facilities

16 within 180 days in States in which it has not fully

17 implemented the requirements of section

18 271(c)(2)(B). The Bell operating company owning

19 or controlling those telecommunications network fa20 cilities shall provide neither telecommunications nor

21 information services to subscribers who are tele22 communications carriers in States in which it is in

23 violation of section 271(c)(2)(B) until the Commis24 sion finds that effective facilities-based local com25 petition exists in the relevant market.
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1 ‘‘(b) ENSURE MARKETS ARE OPEN TO COMPETI2 TION.—

3 ‘‘(1) For an incumbent local exchange carrier

4 (as defined in section 251(h)), other than a Bell op5 erating company, with more than 5 percent of the

6 access lines in the nation the Commission shall en7 sure, upon receipt of a petition from any interested

8 party, that the company’s markets are open to com9 petition by completing an investigation within 120

10 days to determine whether such incumbent local ex11 change carrier has fully complied with section 251(c)

12 for all telecommunications (including voice, video,

13 and data).

14 ‘‘(2) In determining compliance with section

15 251(c), the Commission shall consult with the rel16 evant State regulators and shall use as a benchmark

17 the practices and performance of other incumbent

18 local exchange carriers in the State and region.

19 ‘‘(3)(A) If the Commission finds that such in20 cumbent local exchange carrier is not in full compli21 ance with section 251(c) for all telecommunications

22 (including voice, video, and data), the Commission

23 shall explicitly state the reasons for such carrier not

24 being in full compliance and allow the carrier 60

25 days to come into full compliance.
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1 ‘‘(B) If such carrier does not come into full

2 compliance at the end of the 60-day period, the

3 Commission shall—

4 ‘‘(i) assess on the carrier a forfeiture pen5 alty of $50,000 per day of the continuing viola6 tion; and

7 ‘‘(ii) order the carrier to cease and desist

8 in marketing and selling long distance services

9 to new customers.

10 Such forfeiture penalty and cease and desist order

11 shall continue until the Commission finds that the

12 carrier is in compliance with section 251(c).

13 ‘‘(c) POST APPROVAL PROTECTIONS.—

14 ‘‘(1) IN GENERAL.—If at any time after the ap15 proval of an application consistent with the require16 ments of section 271, the Commission determines

17 that a Bell operating company has ceased to meet

18 one or more of the requirements of section

19 271(c)(2)(B) for all telecommunications (including

20 voice, video, and data), the Commission shall, after

21 notice and opportunity for a hearing assess on the

22 company a forfeiture penalty of $100,000 for each

23 violation and for each day of the continuing viola24 tion.
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1 ‘‘(2) PENALTY.—If at any time after the ap2 proval of an application consistent with the require3 ments of section 271, the Commission determines

4 that a Bell operating company has willfully, know5 ingly, and repeatedly ceased to meet one or more of

6 the requirements of section 271(c)(2)(B) for all tele7 communications (including voice, video, and data),

8 the Commission shall, after notice and opportunity

9 for a hearing order the company to divest itself of

10 its telecommunications network facilities within 180

11 days in States in which it has ceased to meet the re12 quirements of section 271(c)(2)(B).

13 ‘‘(d) AUTHORITY.—Notwithstanding any other provi14 sion of this Act, the Commission shall have full authority

15 to order, implement, and enforce the provisions of this sec16 tion. In implementing this section, the Commission shall

17 ensure that it does not alter the policies and standards

18 in effect as of June 1, 1999, for ensuring compliance with

19 section 271 of the Act.

20 ‘‘(e) ADDITIONAL PROVISIONS.—The provisions of

21 this section are in addition to the penalties and forfeitures

22 provided by title 5 of this Act.’’.

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