[Federal Register Volume 65, Number 5 (Friday, January 7, 2000)]
[Notices]
[Pages 1220-1221]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-117]


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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE


Request for Comments Concerning Compliance with 
Telecommunications Trade Agreements

AGENCY: Office of the United States Trade Representative.

ACTION: Notice of request for public comment.

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SUMMARY: Pursuant to Section 1377 of the Omnibus Trade and 
Competitiveness Act of 1988 (19 U.S.C. 3106) (Section 1377), the Office 
of the United States Trade Representative (USTR) is reviewing, and 
requests comments on: the operation and effectiveness of--including 
implementation of and compliance with--the World Trade Organization 
(WTO) Basic Telecommunications Agreement; other WTO agreements 
affecting market opportunities for telecommunications products and 
services of the United States; the North American Free Trade Agreement 
(NAFTA); and, other telecommunications trade agreements with the Asia 
Pacific Economic Cooperation (APEC) members, the European Union (EU), 
Japan, Korea, Mexico and Taiwan. The USTR will conclude the review on 
March 31, 2000.

DATES: Comments are due by noon on Tuesday, February 1, 2000.

ADDRESSES: Comments must be submitted to Gloria Blue, Executive 
Secretary, Trade Policy Staff Committee, ATTN: Section 1377 Comments, 
Office of the United States Trade Representative, 600 17th Street, NW, 
Washington, DC 20508.

FOR FURTHER INFORMATION CONTACT: William Corbett, Office of Industry 
(202) 395-9586; or Demetrios Marantis, Office of the General Counsel 
(202) 395-3581.

SUPPLEMENTARY INFORMATION: Section 1377 requires the USTR to review 
annually the operation and effectiveness of all U.S. trade agreements 
regarding telecommunications products and services of the United States 
that are in force with respect to the United States. The purpose of the 
review is to determine whether any act, policy, or practice of a 
country that has entered into a telecommunications trade agreement with 
the United States is inconsistent with the terms of such agreement, or 
otherwise denies to U.S. firms, within the context of the terms of such 
agreements, mutually advantageous market opportunities. For the current 
review, the USTR seeks comments on:
    (1) Whether any WTO member is acting in a manner that is 
inconsistent with its specific commitments under the WTO Basic 
Telecommunications Agreement or with other WTO obligations, e.g., the 
WTO General Agreement on Trade in Services (GATS), including the Annex 
on Telecommunications, that affect market opportunities for U.S. 
telecommunications products and services;
    (2) What steps to take regarding out-of-cycle reviews initiated in 
1999 under Section 1377 regarding compliance by Germany and Mexico with 
telecommunications trade agreements;
    (3) Whether Canada or Mexico has failed to comply with their 
commitments under NAFTA;
    (4) Whether APEC members, the EU, Japan, Korea, Mexico or Taiwan 
have failed to comply with their commitments under bilateral 
telecommunications agreements with the United States.
    See 63 FR 1140 (January 8, 1998) for further information concerning 
the agreements listed below and USTR Press Release 99-29 (available at 
www.ustr.gov) for the results of the 1998-99 section 1377 review 
concerning these agreements.

WTO Agreements

    The GATS contains general obligations that apply to all WTO members 
and services and specific obligations that apply only to services 
listed in a member's schedule of commitments. As part of the GATS, WTO 
members have made both basic and value-added telecommunications 
commitments. Specifically, the Fourth Protocol to the GATS--generally 
referred to as the WTO Basic Telecommunications Agreement--is the legal 
instrument embodying seventy WTO members' basic telecommunications 
services commitments under the GATS. The agreement entered into force 
on February 6, 1998, and since that time, an additional eight WTO 
members have made telecommunications services commitments, some upon 
their accession to the WTO. Many members also took separate commitments 
in the area of value-added telecommunications services as part of the 
GATS, which entered into force on January 1, 1995. A description of 
each member's specific commitments is available on the Internet at 
www.wto.org.
    Under the WTO Basic Telecommunications Agreement, members have made 
full or qualified commitments in three specific areas: market access, 
national treatment (including investment), and pro-competitive 
regulatory principles. Countries that have made full market access 
commitments have agreed to local, long-distance and international 
service through any means of network technology, either on a facilities 
basis or through resale of existing network capacity. Countries making 
full national treatment commitments have agreed to ensure treatment no 
less favorable to U.S. services or service suppliers than to services 
or service suppliers of the WTO member making the commitment (e.g., 
U.S. companies can acquire, establish or hold a significant stake in 
foreign telecommunications companies to the same extent as companies of 
the WTO member making the commitment). And finally, countries have also 
adopted pro-competitive regulatory principles--set forth in a Reference 
Paper and incorporated in the members' schedules--which commit members 
to establish independent regulatory bodies, guarantee that U.S. 
companies will be able to interconnect with networks in foreign 
countries at fair prices, maintain appropriate measures to prevent 
anti-competitive practices such as cross-subsidization, and mandate 
transparency of government regulations and licensing.
    The USTR seeks comment on whether any WTO member that has 
undertaken telecommunications services commitments under the GATS has 
failed to make the necessary legislative or regulatory changes to 
implement its commitments, or permits acts, policies, or practices in 
its markets that run counter to that country's commitments. In 
addition, the USTR seeks comments on whether any WTO member permits 
acts, policies, or practices that are inconsistent with other WTO 
obligations and that affect market opportunities for telecommunications 
products and services of the United States.

Out of Cycle Reviews Regarding Germany and Mexico

    The USTR seeks comments on what steps to take regarding out-of-
cycle reviews initiated under Section 1377 in 1999 regarding compliance 
by Germany and Mexico with telecommunications trade.
    Germany--1999 out-of-cycle review: On August 11, 1999, USTR 
announced the extension of an out-of-cycle review

[[Page 1221]]

under Section 1377 of Germany's compliance with its WTO 
telecommunications commitments. The review, initiated on March 30, 
1999, found that recent German regulatory decisions did not endorse 
restrictive and potentially WTO-inconsistent proposals made by Deutsche 
Telekom, the dominant German telecommunications carrier and former 
German monopoly operator. However, the review also concluded that those 
decisions might not be sufficient to prevent anti-competitive behavior 
by Deutsche Telekom as new interconnection arrangements applicable from 
March 1, 2000 are yet to be finalized. U.S. carriers have asserted to 
the U.S. Government that Deutsche Telekom's anti-competitive behavior 
continues to impede their efforts to provide service in Germany. Under 
the WTO Basic Telecom Agreement, Germany committed to maintain 
appropriate measures to prevent anti-competitive behavior. The German 
regulatory authority announced on December 23, 1999, new arrangements 
for interconnection prices and peak and off-peaks timing that will 
apply for the next thirteen months (for additional information 
concerning this decision, see www.regtp.de). The USTR seeks comments on 
whether the latest regulatory decision and other recent steps by the 
German regulatory authority are sufficient to meet Germany's WTO 
telecommunications commitments.
    Mexico--1999 out-of-cycle review: On July 29, 1999, USTR announced 
the extension of an out-of-cycle review under Section 1377 of Mexico's 
compliance with its WTO telecommunications commitments. The review, 
initiated on March 30, 1999, found that Mexico is undertaking a 
consultative policy review and meeting regularly with U.S.-affiliated 
and all other Mexican carriers on international service and domestic 
regulatory issues under study. Interconnection and dominant carrier 
regulations in Mexico have yet to produce lower net domestic 
interconnection costs for new entrants; the Mexican regulatory 
authority has not created confidence that Telmex (the former state-
owned monopolist) is not engaging in anti-competitive cross-
subsidization of different telecom services; and, the Mexican 
regulatory authority has yet to identify a universal service program 
under which Telmex would be required to fund universal service on the 
same basis as its competitors. The results of the 1999 policy review 
are not apparent. The USTR seeks comments on whether Mexico is likely 
to address outstanding international service and domestic regulatory 
issues in a manner consistent with Mexico's WTO telecommunications 
commitments.

NAFTA and Bilateral Trade Agreements

    The USTR seeks comments on the operation and effectiveness of 
certain bilateral trade agreements regarding telecommunications 
products and services, including the NAFTA. The NAFTA includes market 
access and national treatment commitments for value-added 
telecommunications services; and, it includes a national treatment 
commitment for conformity assessment in relation to telecommunications 
equipment standards.
    Bilateral agreements include, on a country-by-country basis:
    Canada: NAFTA Chapter 13 and other telecommunications-related 
provisions.
    Japan: The 1999 Nippon Telegraph and Telephone (NTT) agreement; the 
1994 U.S.-Japan Public Sector Procurement Agreement on 
Telecommunications Products and Services; and, additional 
telecommunications trade agreements with Japan, including a series of 
agreements on: international value-added network services (IVANS) 
(1990-91); open government procurement of all satellites, except for 
government research and development satellites (1990); network channel 
terminating equipment (NCTE) (1990); and cellular and third-party radio 
systems (1989) and cellular radio systems (1994).
    Korea: Agreements in the areas of protection of intellectual 
property rights (IPR), type approval of telecommunications equipment, 
transparent standard-setting processes and non-discriminatory access to 
Korea Telecommunications' procurement of telecommunications products.
    Mexico: NAFTA Chapter 13 and other telecommunications-related 
provisions; and, the 1997 understanding regarding test data acceptance 
agreements between product safety testing laboratories.
    Mutual Recognition Agreements For Conformity Assessment of 
Telecommunications Equipment: Agreement on mutual recognition for 
conformity assessment of telecommunications equipment with the EU; and, 
an agreement among certain members of APEC.
    Taiwan: The October 1999 and February 1998 agreements on WTO 
accession commitments in telecommunications services; the February 1998 
agreement on interconnection pricing for provision of wireless services 
in Taiwan; and, the July 1996 agreement on the licensing and provision 
of wireless services through the establishment of a competitive, 
transparent and fair wireless market in Taiwan.

Public Comment: Requirements for Submissions

    USTR requests comments on: the operation and effectiveness of--
including implementation of and compliance with--the WTO Basic 
Telecommunications Agreement; other WTO agreements affecting market 
opportunities for telecommunications products and services of the 
United States; the NAFTA; and other telecommunications trade agreements 
with APEC members, the EU, Japan, Korea, Mexico and Taiwan. All 
comments must be in English, identify on the first page of the comments 
the telecommunications trade agreement(s) discussed therein, be 
addressed to Gloria Blue, Executive Secretary, TPSC, ATTN: Section 1377 
Comments, Office of the U.S. Trade Representative, and be submitted in 
15 copies by noon on Tuesday, February 1, 2000.
    All comments will be placed in the USTR Reading Room for inspection 
shortly after the filing deadline, except business confidential 
information exempt from public inspection in accordance with 15 CFR 
2003.6. Confidential information submitted in accordance with 15 CFR 
2003.6, must be clearly marked ``BUSINESS CONFIDENTIAL'' in a 
contrasting color ink at the top of each page on each of 15 copies, and 
must be accompanied by 15 copies of a nonconfidential summary of the 
confidential information. The nonconfidential summary will be placed in 
the USTR Public Reading Room.
    An appointment to review the comments may be made by calling Brenda 
Webb at (202) 395-6186. The USTR Reading Room is open to the public 
from 9:30 a.m. to 12 noon, and from 1:00 p.m. to 4:00 p.m., Monday 
through Friday, and is located in Room 101.
Frederick L. Montgomery,
Chairman, Trade Policy Staff Committee.
[FR Doc. 00-117 Filed 1-6-00; 8:45 am]
BILLING CODE 3190-01-P