In the House of Representatives, U. S.,

October 12, 1995.

Resolved, That the bill from the Senate (S. 652) entitled

‘‘An Act to provide for a pro-competitive, de-regulatory national policy framework designed to accelerate rapidly private

sector deployment of advanced telecommunications and information technologies and services to all Americans by opening

all telecommunications markets to competition, and for other

purposes’’, do pass with the following

AMENDMENTS:

Strike out all after the enacting clause and insert:

1 SECTION 1. SHORT TITLE; REFERENCES; TABLE OF CON2 TENTS.

3 (a) SHORT TITLE.—This Act may be cited as the

4 ‘‘Communications Act of 1995’’.

5 (b) REFERENCES.—References in this Act to ‘‘the Act’’

6 are references to the Communications Act of 1934.

7 (c) TABLE OF CONTENTS.—

Sec. 1. Short title; references; table of contents.

TITLE I—DEVELOPMENT OF COMPETITIVE TELECOMMUNICATIONS

MARKETS

Sec. 101. Establishment of part II of title II.
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‘‘PART II—DEVELOPMENT OF COMPETITIVE MARKETS

‘‘Sec. 241. Interconnection.

‘‘Sec. 242. Equal access and interconnection to the local loop for competing

providers.

‘‘Sec. 243. Removal of barriers to entry.

‘‘Sec. 244. Statements of terms and conditions for access and interconnection.

‘‘Sec. 245. Bell operating company entry into interLATA services.

‘‘Sec. 246. Competitive safeguards.

‘‘Sec. 247. Universal service.

‘‘Sec. 248. Pricing flexibility and abolition of rate-of-return regulation.

‘‘Sec. 249. Network functionality and accessibility.

‘‘Sec. 250. Market entry barriers.

‘‘Sec. 251. Illegal changes in subscriber carrier selections.

‘‘Sec. 252. Study.’’.

Sec. 102. Competition in manufacturing, information services, alarm services,

and pay phone services.

‘‘PART III—SPECIAL AND TEMPORARY PROVISIONS

‘‘Sec. 271. Manufacturing by Bell operating companies.

‘‘Sec. 272. Electronic publishing by Bell operating companies.

‘‘Sec. 273. Alarm monitoring and telemessaging services by Bell operating

companies.

‘‘Sec. 274. Provision of payphone service.’’.

Sec. 103. Forbearance from regulation.

‘‘Sec. 230. Protection for private blocking and screening of offensive material; FCC regulation of computer services prohibited.’’.

Sec. 104. Online family empowerment.

Sec. 105. Privacy of customer information.

‘‘Sec. 222. Privacy of customer proprietary network information.’’.

Sec. 106. Pole attachments.

Sec. 107. Preemption of franchising authority regulation of telecommunications

services.

Sec. 108. Facilities siting; radio frequency emission standards.

Sec. 109. Mobile service access to long distance carriers.

Sec. 110. Freedom from toll fraud.

Sec. 111. Report on means of restricting access to unwanted material in interactive telecommunications systems.

Sec. 112. Telecommunications development fund.

‘‘Sec. 10. Telecommunication development fund.’’.

Sec. 113. Report on the use of advanced telecommunications services for medical

purposes.

Sec. 114. Telecommuting public information program.

Sec. 115. Authorization of appropriations.

TITLE II—CABLE COMMUNICATIONS COMPETITIVENESS

Sec. 201. Cable service provided by telephone companies.

‘‘PART V—VIDEO PROGRAMMING SERVICES PROVIDED BY TELEPHONE

COMPANIES

‘‘Sec. 651. Definitions.

‘‘Sec. 652. Separate video programming affiliate.

‘‘Sec. 653. Establishment of video platform.
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‘‘Sec. 654. Authority to prohibit cross-subsidization.

‘‘Sec. 655. Prohibition on buy outs.

‘‘Sec. 656. Applicability of parts I through IV.

‘‘Sec. 657. Rural area exemption.’’.

Sec. 202. Competition from cable systems.

Sec. 203. Competitive availability of navigation devices.

‘‘Sec. 713. Competitive availability of navigation devices.’’.

Sec. 204. Video programming accessibility.

Sec. 205. Technical amendments.

TITLE III—BROADCAST COMMUNICATIONS COMPETITIVENESS

Sec. 301. Broadcaster spectrum flexibility.

‘‘Sec. 336. Broadcast spectrum flexibility.’’.

Sec. 302. Broadcast ownership.

‘‘Sec. 337. Broadcast ownership.’’.

Sec. 303. Foreign investment and ownership.

Sec. 304. Family viewing empowerment.

Sec. 305. Parental choice in television programming.

Sec. 306. Term of licenses.

Sec. 307. Broadcast license renewal procedures.

Sec. 308. Exclusive Federal jurisdiction over direct broadcast satellite service.

Sec. 309. Automated ship distress and safety systems.

Sec. 310. Restrictions on over-the-air reception devices.

Sec. 311. DBS signal security.

Sec. 312. Delegation of equipment testing and certification to private laboratories.

TITLE IV—EFFECT ON OTHER LAWS

Sec. 401. Relationship to other laws.

Sec. 402. Preemption of local taxation with respect to DBS services.

Sec. 403. Protection of minors and clarification of current laws regarding communication of obscene and indecent materials through the use of

computers.

TITLE V—DEFINITIONS

Sec. 501. Definitions.

TITLE VI—SMALL BUSINESS COMPLAINT PROCEDURE

Sec. 601. Complaint procedure.
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1 TITLE I—DEVELOPMENT OF

2 COMPETITIVE TELECOMMUN3 ICATIONS MARKETS

4 SEC. 101. ESTABLISHMENT OF PART II OF TITLE II.

5 (a) AMENDMENT.—Title II of the Act is amended by

6 inserting after section 229 (47 U.S.C. 229) the following

7 new part:

8 ‘‘PART II—DEVELOPMENT OF COMPETITIVE

9 MARKETS

10 ‘‘SEC. 241. INTERCONNECTION.

11 ‘‘The duty of a common carrier under section 201(a)

12 includes the duty to interconnect with the facilities and

13 equipment of other providers of telecommunications services

14 and information services.

15 ‘‘SEC. 242. EQUAL ACCESS AND INTERCONNECTION TO THE

16 LOCAL LOOP FOR COMPETING PROVIDERS.

17 ‘‘(a) OPENNESS AND ACCESSIBILITY OBLIGATIONS.—

18 The duty under section 201(a) of a local exchange carrier

19 includes the following duties:

20 ‘‘(1) INTERCONNECTION.—The duty to provide,

21 in accordance with subsection (b), equal access to and

22 interconnection with the facilities of the carrier’s net23 works to any other carrier or person offering (or seek24 ing to offer) telecommunications services or informa25 tion services reasonably requesting such equal access
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1 and interconnection, so that such networks are fully

2 interoperable with such telecommunications services

3 and information services. For purposes of this para4 graph, a request is not reasonable unless it contains

5 a proposed plan, including a reasonable schedule, for

6 the implementation of the requested access or inter7 connection.

8 ‘‘(2) UNBUNDLING OF NETWORK ELEMENTS.—

9 The duty to offer unbundled services, elements, fea10 tures, functions, and capabilities whenever technically

11 feasible, at just, reasonable, and nondiscriminatory

12 prices and in accordance with subsection (b)(4).

13 ‘‘(3) RESALE.—The duty—

14 (A) to offer services, elements, features, func15 tions, and capabilities for resale at wholesale

16 rates, and

17 (B) not to prohibit, and not to impose un18 reasonable or discriminatory conditions or limi19 tations on, the resale of such services, elements,

20 features, functions, and capabilities, on a bun21 dled or unbundled basis, except that a carrier

22 may prohibit a reseller that obtains at wholesale

23 rates a service, element, feature, function, or ca24 pability that is available at retail only to a cat25 egory of subscribers from offering such service,
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1 element, feature, function, or capability to a dif2 ferent category of subscribers.

3 For the purposes of this paragraph, wholesale rates

4 shall be determined on the basis of retail rates for the

5 service, element, feature, function, or capability pro6 vided, excluding the portion thereof attributable to

7 any marketing, billing, collection, and other costs that

8 are avoided by the local exchange carrier.

9 ‘‘(4) NUMBER PORTABILITY.—The duty to pro10 vide, to the extent technically feasible, number port11 ability in accordance with requirements prescribed by

12 the Commission.

13 ‘‘(5) DIALING PARITY.—The duty to provide, in

14 accordance with subsection (c), dialing parity to com15 peting providers of telephone exchange service and

16 telephone toll service.

17 ‘‘(6) ACCESS TO RIGHTS-OF-WAY.—The duty to

18 afford access to the poles, ducts, conduits, and rights19 of-way of such carrier to competing providers of tele20 communications services in accordance with section

21 224(d).

22 ‘‘(7) NETWORK FUNCTIONALITY AND ACCESSIBIL23 ITY.—The duty not to install network features, func24 tions, or capabilities that do not comply with any

25 standards established pursuant to section 249.
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1 ‘‘(8) GOOD FAITH NEGOTIATION.—The duty to

2 negotiate in good faith, under the supervision of State

3 commissions, the particular terms and conditions of

4 agreements to fulfill the duties described in para5 graphs (1) through (7). The other carrier or person

6 requesting interconnection shall also be obligated to

7 negotiate in good faith the particular terms and con8 ditions of agreements to fulfill the duties described in

9 paragraphs (1) through (7).

10 ‘‘(b) INTERCONNECTION, COMPENSATION, AND EQUAL

11 ACCESS.—

12 ‘‘(1) INTERCONNECTION.—A local exchange car13 rier shall provide access to and interconnection with

14 the facilities of the carrier’s network at any tech15 nically feasible point within the carrier’s network on

16 just and reasonable terms and conditions, to any

17 other carrier or person offering (or seeking to offer)

18 telecommunications services or information services

19 requesting such access.

20 ‘‘(2) INTERCARRIER COMPENSATION BETWEEN

21 FACILITIES-BASED CARRIERS.—

22 ‘‘(A) IN GENERAL.—For the purposes of

23 paragraph (1), the terms and conditions for

24 interconnection of the network facilities of a

25 competing provider of telephone exchange service
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1 shall not be considered to be just and reasonable

2 unless—

3 ‘‘(i) such terms and conditions provide

4 for the mutual and reciprocal recovery by

5 each carrier of costs associated with the ter6 mination on such carrier’s network facili7 ties of calls that originate on the network

8 facilities of the other carrier;

9 ‘‘(ii) such terms and conditions deter10 mine such costs on the basis of a reasonable

11 approximation of the additional costs of ter12 minating such calls; and

13 ‘‘(iii) the recovery of costs permitted by

14 such terms and conditions are reasonable in

15 relation to the prices for termination of

16 calls that would prevail in a competitive

17 market.

18 ‘‘(B) RULES OF CONSTRUCTION.—This

19 paragraph shall not be construed—

20 ‘‘(i) to preclude arrangements that af21 ford such mutual recovery of costs through

22 the offsetting of reciprocal obligations, in23 cluding arrangements that waive mutual re24 covery (such as bill-and-keep arrangements);

25 or
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1 ‘‘(ii) to authorize the Commission or

2 any State commission to engage in any rate

3 regulation proceeding to establish with par4 ticularity the additional costs of terminat5 ing calls, or to require carriers to maintain

6 records with respect to the additional costs

7 of terminating calls.

8 ‘‘(3) EQUAL ACCESS.—A local exchange carrier

9 shall afford, to any other carrier or person offering

10 (or seeking to offer) a telecommunications service or

11 an information service, reasonable and nondiscrim12 inatory access on an unbundled basis—

13 ‘‘(A) to databases, signaling systems, billing

14 and collection services, poles, ducts, conduits,

15 and rights-of-way owned or controlled by a local

16 exchange carrier, or other facilities, functions, or

17 information (including subscriber numbers) inte18 gral to the efficient transmission, routing, or

19 other provision of telephone exchange services or

20 exchange access;

21 ‘‘(B) that is equal in type and quality to

22 the access which the carrier affords to itself or to

23 any other person, and is available at non24 discriminatory prices; and
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1 ‘‘(C) that is sufficient to ensure the full

2 interoperability of the equipment and facilities

3 of the carrier and of the person seeking such ac4 cess.

5 ‘‘(4) COMMISSION ACTION REQUIRED.—

6 ‘‘(A) IN GENERAL.—Within 6 months after

7 the date of enactment of this part, the Commis8 sion shall complete all actions necessary (includ9 ing any reconsideration) to establish regulations

10 to implement the requirements of this section.

11 The Commission shall establish such regulations

12 after consultation with the Joint Board estab13 lished pursuant to section 247.

14 ‘‘(B) ACCOMMODATION OF STATE ACCESS

15 REGULATIONS.—In prescribing and enforcing

16 regulations to implement the requirements of this

17 section, the Commission shall not preclude the

18 enforcement of any regulation, order, or policy of

19 a State commission that—

20 ‘‘(i) establishes access and interconnec21 tion obligations of local exchange carriers;

22 ‘‘(ii) is consistent with the require23 ments of this section; and

24 ‘‘(iii) does not substantially prevent

25 the Commission from fulfilling the require-
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1 ments of this section and the purposes of

2 this part.

3 ‘‘(C) COLLOCATION.—Such regulations shall

4 provide for actual collocation of equipment nec5 essary for interconnection for telecommuni6 cations services at the premises of a local ex7 change carrier, except that the regulations shall

8 provide for virtual collocation where the local ex9 change carrier demonstrates that actual colloca10 tion is not practical for technical reasons or be11 cause of space limitations.

12 ‘‘(D) USER PAYMENT OF COSTS.—Such reg13 ulations shall require that the costs that a car14 rier incurs in offering access, interconnection,

15 number portability, or unbundled services, ele16 ments, features, functions, and capabilities shall

17 be borne by the users of such access, interconnec18 tion, number portability, or services, elements,

19 features, functions, and capabilities.

20 ‘‘(E) IMPUTED CHARGES TO CARRIER.—

21 Such regulations shall require the carrier, to the

22 extent it provides a telecommunications service

23 or an information service that requires access or

24 interconnection to its network facilities, to im-
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1 pute such access and interconnection charges to

2 itself.

3 ‘‘(c) NUMBER PORTABILITY AND DIALING PARITY.—

4 ‘‘(1) AVAILABILITY.—A local exchange carrier

5 shall ensure that—

6 ‘‘(A) number portability shall be available

7 on request in accordance with subsection (a)(4);

8 and

9 ‘‘(B) dialing parity shall be available upon

10 request, except that, in the case of a Bell operat11 ing company, such company shall ensure that

12 dialing parity for intraLATA telephone toll serv13 ice shall be available not later than the date such

14 company is authorized to provide interLATA

15 services.

16 ‘‘(2) NUMBER ADMINISTRATION.—The Commis17 sion shall designate one or more impartial entities to

18 administer telecommunications numbering and to

19 make such numbers available on an equitable basis.

20 The Commission shall have exclusive jurisdiction over

21 those portions of the North American Numbering Plan

22 that pertain to the United States. Nothing in this

23 paragraph shall preclude the Commission from dele24 gating to State commissions or other entities any por25 tion of such jurisdiction.
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1 ‘‘(d) JOINT MARKETING OF RESOLD ELEMENTS.—

2 ‘‘(1) RESTRICTION.—Except as provided in

3 paragraph (2), no service, element, feature, function,

4 or capability that is made available for resale in any

5 State by a Bell operating company may be jointly

6 marketed directly or indirectly with any interLATA

7 telephone toll service until such Bell operating com8 pany is authorized pursuant to section 245(c) to pro9 vide interLATA services in such State.

10 ‘‘(2) COMPETING PROVIDERS.—Paragraph (1)

11 shall not prohibit joint marketing of services, ele12 ments, features, functions, or capabilities acquired

13 from a Bell operating company by an unaffiliated

14 provider that, together with its affiliates, has in the

15 aggregate less than 2 percent of the access lines in16 stalled nationwide.

17 ‘‘(e) MODIFICATIONS AND WAIVERS.—The Commission

18 may modify or waive the requirements of this section for

19 any local exchange carrier (or class or category of such car20 riers) that has, in the aggregate nationwide, fewer than

21 500,000 access lines installed, to the extent that the Com22 mission determines that compliance with such requirements

23 (without such modification) would be unduly economically

24 burdensome or technologically infeasible.
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1 ‘‘(f) EXEMPTION FOR CERTAIN RURAL TELEPHONE

2 COMPANIES.—Subsections (a) through (d) of this section

3 shall not apply to a rural telephone company, until such

4 company has received a bona fide request for services, ele5 ments, features or capabilities described in subsections (a)

6 through (d). Following a bona fide request to the carrier

7 and notice of the request to the State commission, the State

8 commission shall determine within 120 days whether the

9 request would be unduly economically burdensome, be tech10 nologically infeasible, and be consistent with subsections

11 (b)(1) through (b)(5), (c)(1), and (c)(3) of section 247. The

12 exemption provided by this subsection shall not apply if

13 such carrier provides video programming services over its

14 telephone exchange facilities in its telephone service area.

15 ‘‘(g) TIME AND MANNER OF COMPLIANCE.—The State

16 shall establish, after determining pursuant to subsection (f)

17 that a bona fide request is not economically burdensome,

18 is technologically feasible, and is consistent with subsections

19 (b)(1) through (b)(5), (c)(1), and (c)(3) of section 247, an

20 implementation schedule for compliance with such ap21 proved bona fide request that is consistent in time and

22 manner with Commission rules.

23 ‘‘(h) AVOIDANCE OF REDUNDANT REGULATIONS.—

24 ‘‘(1) COMMISSION REGULATIONS.—Nothing in

25 this section shall be construed to prohibit the Commis-
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1 sion from enforcing regulations prescribed prior to the

2 date of enactment of this part in fulfilling the re3 quirements of this section, to the extent that such reg4 ulations are consistent with the provisions of this sec5 tion.

6 ‘‘(2) STATE REGULATIONS.—Nothing in this sec7 tion shall be construed to prohibit any State commis8 sion from enforcing regulations prescribed prior to the

9 date of enactment of this part, or from prescribing

10 regulations after such date of enactment, in fulfilling

11 the requirements of this section, if (A) such regula12 tions are consistent with the provisions of this section,

13 and (B) the enforcement of such regulations has not

14 been precluded under subsection (b)(4)(B).

15 ‘‘SEC. 243. REMOVAL OF BARRIERS TO ENTRY.

16 (a) IN GENERAL.—No State or local statute or regula17 tion, or other State or local legal requirement, may prohibit

18 or have the effect of prohibiting the ability of any entity

19 to provide interstate or intrastate telecommunications serv20 ices.

21 (b) STATE AND LOCAL AUTHORITY.—Nothing in this

22 section shall affect the ability of a State or local government

23 to impose, on a competitively neutral basis and consistent

24 with section 247 (relating to universal service), require25 ments necessary to preserve and advance universal service,
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1 protect the public safety and welfare, ensure the continued

2 quality of telecommunications services, and safeguard the

3 rights of consumers.

4 (c) LOCAL GOVERNMENT AUTHORITY.—Nothing in

5 this Act affects the authority of a local government to man6 age the public rights-of-way or to require fair and reason7 able compensation from telecommunications providers, on

8 a competitively neutral and nondiscriminatory basis, for

9 use of the rights-of-way on a nondiscriminatory basis, if

10 the compensation required is publicly disclosed by such gov11 ernment.

12 (d) EXCEPTION.—In the case of commercial mobile

13 services, the provisions of section 332(c)(3) shall apply in

14 lieu of the provisions of this section.

15 ‘‘SEC. 244. STATEMENTS OF TERMS AND CONDITIONS FOR

16 ACCESS AND INTERCONNECTION.

17 ‘‘(a) IN GENERAL.—Within 18 months after the date

18 of enactment of this part, and from time to time thereafter,

19 a local exchange carrier shall prepare and file with a State

20 commission statements of the terms and conditions that

21 such carrier generally offers within that State with respect

22 to the services, elements, features, functions, or capabilities

23 provided to comply with the requirements of section 242

24 and the regulations thereunder. Any such statement per25 taining to the charges for interstate services, elements, fea-
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1 tures, functions, or capabilities shall be filed with the Com2 mission.

3 ‘‘(b) REVIEW.—

4 ‘‘(1) STATE COMMISSION REVIEW.—A State com5 mission to which a statement is submitted under sub6 section (a) shall review such statement in accordance

7 with State law. A State commission may not approve

8 such statement unless such statement complies with

9 section 242 and the regulations thereunder. Except as

10 provided in section 243, nothing in this section shall

11 prohibit a State commission from establishing or en12 forcing other requirements of State law in its review

13 of such statement, including requiring compliance

14 with intrastate telecommunications service quality

15 standards or requirements.

16 ‘‘(2) FCC REVIEW.—The Commission shall re17 view such statements to ensure that—

18 ‘‘(A) the charges for interstate services, ele19 ments, features, functions, or capabilities are

20 just, reasonable, and nondiscriminatory; and

21 ‘‘(B) the terms and conditions for such

22 interstate services or elements unbundle any sep23 arable services, elements, features, functions, or

24 capabilities in accordance with section 242(a)(2)

25 and any regulations thereunder.
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1 ‘‘(c) TIME FOR REVIEW.—

2 ‘‘(1) SCHEDULE FOR REVIEW.—The Commission

3 and the State commission to which a statement is

4 submitted shall, not later than 60 days after the date

5 of such submission—

6 ‘‘(A) complete the review of such statement

7 under subsection (b) (including any reconsider8 ation thereof), unless the submitting carrier

9 agrees to an extension of the period for such re10 view; or

11 ‘‘(B) permit such statement to take effect.

12 ‘‘(2) AUTHORITY TO CONTINUE REVIEW.—Para13 graph (1) shall not preclude the Commission or a

14 State commission from continuing to review a state15 ment that has been permitted to take effect under sub16 paragraph (B) of such paragraph.

17 ‘‘(d) EFFECT OF AGREEMENTS.—Nothing in this sec18 tion shall prohibit a carrier from filing an agreement to

19 provide services, elements, features, functions, or capabili20 ties affording access and interconnection as a statement of

21 terms and conditions that the carrier generally offers for

22 purposes of this section. An agreement affording access and

23 interconnection shall not be approved under this section un24 less the agreement contains a plan, including a reasonable

25 schedule, for the implementation of the requested access or
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1 interconnection. The approval of a statement under this sec2 tion shall not operate to prohibit a carrier from entering

3 into subsequent agreements that contain terms and condi4 tions that differ from those contained in a statement that

5 has been reviewed and approved under this section, but—

6 ‘‘(1) each such subsequent agreement shall be

7 filed under this section; and

8 ‘‘(2) such carrier shall be obligated to offer access

9 to such services, elements, features, functions, or capa10 bilities to other carriers and persons (including car11 riers and persons covered by previously approved

12 statements) requesting such access on terms and con13 ditions that, in relation to the terms and conditions

14 in such subsequent agreements, are not discrimina15 tory.

16 ‘‘(e) SUNSET.—The provisions of this section shall

17 cease to apply in any local exchange market, defined by

18 geographic area and class or category of service, that the

19 Commission and the State determines has become subject

20 to full and open competition.

21 ‘‘SEC. 245. BELL OPERATING COMPANY ENTRY INTO

22 INTERLATA SERVICES.

23 ‘‘(a) VERIFICATION OF ACCESS AND INTERCONNECTION

24 COMPLIANCE.—At any time after 6 months after the date

25 of enactment of this part, a Bell operating company may
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1 provide to the Commission verification by such company

2 with respect to one or more States that such company is

3 in compliance with the requirements of this part. Such ver4 ification shall contain the following:

5 ‘‘(1) CERTIFICATION.—A certification by each

6 State commission of such State or States that such

7 carrier has fully implemented the conditions described

8 in subsection (b), except as provided in subsection

9 (c)(2).

10 ‘‘(2) AGREEMENT OR STATEMENT.—For each

11 such State, either of the following:

12 ‘‘(A) PRESENCE OF A FACILITIES-BASED

13 COMPETITOR.—An agreement that has been ap14 proved under section 244 specifying the terms

15 and conditions under which the Bell operating

16 company is providing access and interconnection

17 to its network facilities in accordance with sec18 tion 242 for the network facilities of an unaffili19 ated competing provider of telephone exchange

20 service (as defined in section 3(44)(A), but ex21 cluding exchange access service) to residential

22 and business subscribers. For the purpose of this

23 subparagraph, such telephone exchange service

24 may be offered by such competing provider either

25 exclusively over its own telephone exchange serv-
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1 ice facilities or predominantly over its own tele2 phone exchange service facilities in combination

3 with the resale of the services of another carrier.

4 For the purpose of this subparagraph, services

5 provided pursuant to subpart K of part 22 of the

6 Commission’s regulations (47 C.F.R. 22.901 et

7 seq.) shall not be considered to be telephone ex8 change services.

9 ‘‘(B) FAILURE TO REQUEST ACCESS.—If no

10 such provider has requested such access and

11 interconnection before the date which is 3 months

12 before the date the company makes its submis13 sion under this subsection, a statement of the

14 terms and conditions that the carrier generally

15 offers to provide such access and interconnection

16 that has been approved or permitted to take ef17 fect by the State commission under section 244.

18 For purposes of subparagraph (B), a Bell operating

19 company shall be considered not to have received any

20 request for access or interconnection if the State com21 mission of such State or States certifies that the only

22 provider or providers making such request have (i)

23 failed to bargain in good faith under the supervision

24 of such State commission pursuant to section

25 242(a)(8), or (ii) have violated the terms of their
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1 agreement by failure to comply, within a reasonable

2 period of time, with the implementation schedule con3 tained in such agreement.

4 ‘‘(b) CERTIFICATION OF COMPLIANCE WITH PART

5 II.—For the purposes of subsection (a)(1), a Bell operating

6 company shall submit to the Commission a certification by

7 a State commission of compliance with each of the following

8 conditions in any area where such company provides local

9 exchange service or exchange access in such State:

10 ‘‘(1) INTERCONNECTION.—The Bell operating

11 company provides access and interconnection in ac12 cordance with subsections (a)(1) and (b) of section

13 242 to any other carrier or person offering tele14 communications services requesting such access and

15 interconnection, and complies with the Commission

16 regulations pursuant to such section concerning such

17 access and interconnection.

18 ‘‘(2) UNBUNDLING OF NETWORK ELEMENTS.—

19 The Bell operating company provides unbundled serv20 ices, elements, features, functions, and capabilities in

21 accordance with subsection (a)(2) of section 242 and

22 the regulations prescribed by the Commission pursu23 ant to such section.

24 ‘‘(3) RESALE.—The Bell operating company of25 fers services, elements, features, functions, and capa-
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1 bilities for resale in accordance with section

2 242(a)(3), and neither the Bell operating company,

3 nor any unit of State or local government within the

4 State, imposes any restrictions on resale or sharing of

5 telephone exchange service (or unbundled services, ele6 ments, features, or functions of telephone exchange

7 service) in violation of section 242(a)(3).

8 ‘‘(4) NUMBER PORTABILITY.—The Bell operating

9 company provides number portability in compliance

10 with the Commission’s regulations pursuant to sub11 sections (a)(4) and (c) of section 242.

12 ‘‘(5) DIALING PARITY.—The Bell operating com13 pany provides dialing parity in accordance with sub14 sections (a)(5) and (c) of section 242, and will, not

15 later than the effective date of its authority to com16 mence providing interLATA services, take such ac17 tions as are necessary to provide dialing parity for

18 intraLATA telephone toll service in accordance with

19 such subsections.

20 ‘‘(6) ACCESS TO CONDUITS AND RIGHTS OF

21 WAY.—The poles, ducts, conduits, and rights of way

22 of such Bell operating company are available to com23 peting providers of telecommunications services in ac24 cordance with the requirements of sections 242(a)(6)

25 and 224(d).
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1 ‘‘(7) ELIMINATION OF FRANCHISE LIMITA2 TIONS.—No unit of the State or local government in

3 such State or States enforces any prohibition or limi4 tation in violation of section 243.

5 ‘‘(8) NETWORK FUNCTIONALITY AND ACCESSIBIL6 ITY.—The Bell operating company will not install

7 network features, functions, or capabilities that do not

8 comply with the standards established pursuant to

9 section 249.

10 ‘‘(9) NEGOTIATION OF TERMS AND CONDI11 TIONS.—The Bell operating company has negotiated

12 in good faith, under the supervision of the State com13 mission, in accordance with the requirements of sec14 tion 242(a)(8) with any other carrier or person re15 questing access or interconnection.

16 ‘‘(c) COMMISSION REVIEW.—

17 ‘‘(1) REVIEW OF STATE DECISIONS AND CERTIFI18 CATIONS.—The Commission shall review any verifica19 tion submitted by a Bell operating company pursuant

20 to subsection (a). The Commission may require such

21 company to submit such additional information as is

22 necessary to validate any of the items of such verifica23 tion.

24 ‘‘(2) DE NOVO REVIEW.—If—
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1 ‘‘(A) a State commission does not have the

2 jurisdiction or authority to make the certifi3 cation required by subsection (b);

4 ‘‘(B) the State commission has failed to act

5 within 90 days after the date a request for such

6 certification is filed with such State commission;

7 or

8 ‘‘(C) the State commission has sought to

9 impose a term or condition in violation of sec10 tion 243;

11 the local exchange carrier may request the Commis12 sion to certify the carrier’s compliance with the con13 ditions specified in subsection (b).

14 ‘‘(3) CONSULTATION WITH THE ATTORNEY GEN15 ERAL.—The Commission shall notify the Attorney

16 General promptly of any verification submitted for

17 approval under this subsection, and shall identify

18 any verification that, if approved, would relieve the

19 Bell operating company and its affiliates of the pro20 hibition concerning manufacturing contained in sec21 tion 271(a). Before making any determination under

22 this subsection, the Commission shall consult with the

23 Attorney General, and if the Attorney General sub24 mits any comments in writing, such comments shall

25 be included in the record of the Commission’s deci-
26

•S 652 EAH

1 sion. In consulting with and submitting comments to

2 the Commission under this paragraph, the Attorney

3 General shall provide to the Commission an evalua4 tion of whether there is a dangerous probability that

5 the Bell operating company or its affiliates would

6 successfully use market power to substantially impede

7 competition in the market such company seeks to

8 enter. In consulting with and submitting comments to

9 the Commission under this paragraph with respect to

10 a verification that, if approved, would relieve the Bell

11 operating company and its affiliates of the prohibi12 tion concerning manufacturing contained in section

13 271(a), the Attorney General shall also provide to the

14 Commission an evaluation of whether there is a dan15 gerous probability that the Bell operating company or

16 its affiliates would successfully use market power to

17 substantially impede competition in manufacturing.

18 ‘‘(4) TIME FOR DECISION; PUBLIC COMMENT.—

19 Unless such Bell operating company consents to a

20 longer period of time, the Commission shall approve,

21 disapprove, or approve with conditions such verifica22 tion within 90 days after the date of its submission.

23 During such 90 days, the Commission shall afford in24 terested persons an opportunity to present informa25 tion and evidence concerning such verification.
27

•S 652 EAH

1 ‘‘(5) STANDARD FOR DECISION.—The Commis2 sion shall not approve such verification unless the

3 Commission determines that—

4 ‘‘(A) the Bell operating company meets each

5 of the conditions required to be certified under

6 subsection (b); and

7 ‘‘(B) the agreement or statement submitted

8 under subsection (a)(2) complies with the re9 quirements of section 242 and the regulations

10 thereunder.

11 ‘‘(d) ENFORCEMENT OF CONDITIONS.—

12 ‘‘(1) COMMISSION AUTHORITY.—If at any time

13 after the approval of a verification under subsection

14 (c), the Commission determines that a Bell operating

15 company has ceased to meet any of the conditions re16 quired to be certified under subsection (b), the Com17 mission may, after notice and opportunity for a hear18 ing—

19 ‘‘(A) issue an order to such company to cor20 rect the deficiency;

21 ‘‘(B) impose a penalty on such company

22 pursuant to title V; or

23 ‘‘(C) suspend or revoke such approval.

24 ‘‘(2) RECEIPT AND REVIEW OF COMPLAINTS.—

25 The Commission shall establish procedures for the re-
28

•S 652 EAH

1 view of complaints concerning failures by Bell operat2 ing companies to meet conditions required to be cer3 tified under subsection (b). Unless the parties other4 wise agree, the Commission shall act on such com5 plaint within 90 days.

6 ‘‘(3) STATE AUTHORITY.—The authority of the

7 Commission under this subsection shall not be con8 strued to preempt any State commission from taking

9 actions to enforce the conditions required to be cer10 tified under subsection (b).

11 ‘‘(e) AUTHORITY TO PROVIDE INTERLATA SERV12 ICES.—

13 ‘‘(1) PROHIBITION.—Except as provided in

14 paragraph (2) and subsections (f), (g), and (h), a Bell

15 operating company or affiliate thereof may not pro16 vide interLATA services.

17 ‘‘(2) AUTHORITY SUBJECT TO CERTIFICATION.—

18 A Bell operating company or affiliate thereof may, in

19 any States to which its verification under subsection

20 (a) applies, provide interLATA services—

21 ‘‘(A) during any period after the effective

22 date of the Commission’s approval of such ver23 ification pursuant to subsection (c), and
29

•S 652 EAH

1 ‘‘(B) until the approval of such verification

2 is suspended or revoked by the Commission pur3 suant to subsection (c).

4 ‘‘(f) EXCEPTION FOR PREVIOUSLY AUTHORIZED AC5 TIVITIES.—Subsection (e) shall not prohibit a Bell operat6 ing company or affiliate from engaging, at any time after

7 the date of the enactment of this part, in any activity as

8 authorized by an order entered by the United States Dis9 trict Court for the District of Columbia pursuant to section

10 VII or VIII(C) of the Modification of Final Judgment, if—

11 ‘‘(1) such order was entered on or before the date

12 of the enactment of this part, or

13 ‘‘(2) a request for such authorization was pend14 ing before such court on the date of the enactment of

15 this part.

16 ‘‘(g) EXCEPTIONS FOR INCIDENTAL SERVICES.—Sub17 section (e) shall not prohibit a Bell operating company or

18 affiliate thereof, at any time after the date of the enactment

19 of this part, from providing interLATA services for the pur20 pose of—

21 ‘‘(1)(A) providing audio programming, video

22 programming, or other programming services to sub23 scribers to such services of such company;

24 ‘‘(B) providing the capability for interaction by

25 such subscribers to select or respond to such audio
30

•S 652 EAH

1 programming, video programming, or other program2 ming services; or

3 ‘‘(C) providing to distributors audio program4 ming or video programming that such company owns

5 or controls, or is licensed by the copyright owner of

6 such programming (or by an assignee of such owner)

7 to distribute;

8 ‘‘(2) providing a telecommunications service,

9 using the transmission facilities of a cable system

10 that is an affiliate of such company, and that is lo11 cated within a State in which such company is not,

12 on the date of the enactment of this part, a provider

13 of wireline telephone exchange service;

14 ‘‘(3) providing commercial mobile services in ac15 cordance with section 332(c) of this Act and with the

16 regulations prescribed by the Commission pursuant to

17 paragraph (8) of such section;

18 ‘‘(4) providing a service that permits a customer

19 that is located in one local access and transport area

20 to retrieve stored information from, or file informa21 tion for storage in, information storage facilities of

22 such company that are located in another local access

23 and transport area;

24 ‘‘(5) providing signaling information used in

25 connection with the provision of telephone exchange
31

•S 652 EAH

1 services to a local exchange carrier that, together with

2 any affiliated local exchange carriers, has aggregate

3 annual revenues of less than $100,000,000; or

4 ‘‘(6) providing network control signaling infor5 mation to, and receiving such signaling information

6 from, common carriers offering interLATA services at

7 any location within the area in which such Bell oper8 ating company provides telephone exchange services

9 or exchange access.

10 ‘‘(h) OUT-OF-REGION SERVICES.—When a Bell operat11 ing company and its affiliates have obtained Commission

12 approval under subsection (c) for each State in which such

13 Bell operating company and its affiliates provide telephone

14 exchange service on the date of enactment of this part, such

15 Bell operating company and any affiliate thereof may, not16 withstanding subsection (e), provide interLATA services—

17 ‘‘(1) for calls originating in, and billed to a cus18 tomer in, a State in which neither such company nor

19 any affiliate provided telephone exchange service on

20 such date of enactment; or

21 ‘‘(2) for calls originating outside the United

22 States.

23 ‘‘(i) INTRALATA TOLL DIALING PARITY.—Neither the

24 Commission nor any State may order any Bell operating

25 company to provide dialing parity for intraLATA tele-
32

•S 652 EAH

1 phone toll service in any State before the date such company

2 is authorized to provide interLATA services in such State

3 pursuant to this section.

4 ‘‘(j) FORBEARANCE.—The Commission may not, pur5 suant to section 230, forbear from applying any provision

6 of this section or any regulation thereunder until at least

7 5 years after the date of enactment of this part.

8 ‘‘(k) SUNSET.—The provisions of this section shall

9 cease to apply in any local exchange market, defined by

10 geographic area and class or category of service, that the

11 Commission and the State determines has become subject

12 to full and open competition.

13 ‘‘(l) DEFINITIONS.—As used in this section—

14 ‘‘(1) AUDIO PROGRAMMING.—The term ‘audio

15 programming’ means programming provided by, or

16 generally considered comparable to programming pro17 vided by, a radio broadcast station.

18 ‘‘(2) VIDEO PROGRAMMING.—The term ‘video

19 programming’ has the meaning provided in section

20 602.

21 ‘‘(3) OTHER PROGRAMMING SERVICES.—The

22 term ‘other programming services’ means information

23 (other than audio programming or video program24 ming) that the person who offers a video program25 ming service makes available to all subscribers gen-
33

•S 652 EAH

1 erally. For purposes of the preceding sentence, the

2 terms ‘information’ and ‘makes available to all sub3 scribers generally’ have the same meaning such terms

4 have under section 602(13) of this Act.

5 ‘‘SEC. 246. COMPETITIVE SAFEGUARDS.

6 ‘‘(a) IN GENERAL.—In accordance with the require7 ments of this section and the regulations adopted there8 under, a Bell operating company or any affiliate thereof

9 providing any interLATA telecommunications or

10 interLATA information service, shall do so through a sub11 sidiary that is separate from the Bell operating company

12 or any affiliate thereof that provides telephone exchange

13 service. The requirements of this section shall not apply

14 with respect to (1) activities in which a Bell operating com15 pany or affiliate may engage pursuant to section 245(f),

16 or (2) incidental services in which a Bell operating com17 pany or affiliate may engage pursuant to section 245(g),

18 other than services described in paragraph (4) of such sec19 tion.

20 ‘‘(b) TRANSACTION REQUIREMENTS.—Any transaction

21 between such a subsidiary and a Bell operating company

22 and any other affiliate of such company shall be conducted

23 on an arm’s-length basis, in the same manner as the Bell

24 operating company conducts business with unaffiliated per25 sons, and shall not be based upon any preference or dis-
34

•S 652 EAH

1 crimination in favor of the subsidiary arising out of the

2 subsidiary’s affiliation with such company.

3 ‘‘(c) SEPARATE OPERATION AND PROPERTY.—A sub4 sidiary required by this section shall—

5 ‘‘(1) operate independently from the Bell operat6 ing company or any affiliate thereof,

7 ‘‘(2) have separate officers, directors, and em8 ployees who may not also serve as officers, directors,

9 or employees of the Bell operating company or any

10 affiliate thereof,

11 ‘‘(3) not enter into any joint venture activities or

12 partnership with a Bell operating company or any

13 affiliate thereof,

14 ‘‘(4) not own any telecommunications trans15 mission or switching facilities in common with the

16 Bell operating company or any affiliate thereof, and

17 ‘‘(5) not jointly own or share the use of any

18 other property with the Bell operating company or

19 any affiliate thereof.

20 ‘‘(d) BOOKS, RECORDS, AND ACCOUNTS.—Any subsidi21 ary required by this section shall maintain books, records,

22 and accounts in a manner prescribed by the Commission

23 which shall be separate from the books, records, and ac24 counts maintained by a Bell operating company or any af25 filiate thereof.
35

•S 652 EAH

1 ‘‘(e) PROVISION OF SERVICES AND INFORMATION.—A

2 Bell operating company or any affiliate thereof may not

3 discriminate between a subsidiary required by this section

4 and any other person in the provision or procurement of

5 goods, services, facilities, or information, or in the establish6 ment of standards, and shall not provide any goods, serv7 ices, facilities or information to a subsidiary required by

8 this section unless such goods, services, facilities or informa9 tion are made available to others on reasonable, non10 discriminatory terms and conditions.

11 ‘‘(f) PREVENTION OF CROSS-SUBSIDIES.—A Bell oper12 ating company or any affiliate thereof required to maintain

13 a subsidiary under this section shall establish and admin14 ister, in accordance with the requirements of this section

15 and the regulations prescribed thereunder, a cost allocation

16 system that prohibits any cost of providing interLATA tele17 communications or interLATA information services from

18 being subsidized by revenue from telephone exchange serv19 ices and telephone exchange access services. The cost alloca20 tion system shall employ a formula that ensures that—

21 ‘‘(1) the rates for telephone exchange services and

22 exchange access are no greater than they would have

23 been in the absence of such investment in interLATA

24 telecommunications or interLATA information serv25 ices (taking into account any decline in the real costs
36

•S 652 EAH

1 of providing such telephone exchange services and ex2 change access); and

3 ‘‘(2) such interLATA telecommunications or

4 interLATA information services bear a reasonable

5 share of the joint and common costs of facilities used

6 to provide telephone exchange, exchange access, and

7 competitive services.

8 ‘‘(g) ASSETS.—The Commission shall, by regulation,

9 ensure that the economic risks associated with the provision

10 of interLATA telecommunications or interLATA informa11 tion services by a Bell operating company or any affiliate

12 thereof (including any increases in such company’s cost of

13 capital that occur as a result of the provision of such serv14 ices) are not borne by customers of telephone exchange serv15 ices and exchange access in the event of a business loss or

16 failure. Investments or other expenditures assigned to

17 interLATA telecommunications or interLATA information

18 services shall not be reassigned to telephone exchange service

19 or exchange access.

20 ‘‘(h) DEBT.—A subsidiary required by this section

21 shall not obtain credit under any arrangement that

22 would—

23 ‘‘(1) permit a creditor, upon default, to have re24 source to the assets of a Bell operating company; or
37

•S 652 EAH

1 ‘‘(2) induce a creditor to rely on the tangible or

2 intangible assets of a Bell operating company in ex3 tending credit.

4 ‘‘(i) FULFILLMENT OF CERTAIN REQUESTS.—A Bell

5 operating company or an affiliate thereof shall—

6 ‘‘(1) fulfill any requests from an unaffiliated en7 tity for telephone exchange service and exchange ac8 cess within a period no longer than the period in

9 which it provides such telephone exchange service and

10 exchange access to itself or to its affiliates;

11 ‘‘(2) fulfill any such requests with telephone ex12 change service and exchange access of a quality that

13 meets or exceeds the quality of telephone exchange

14 services and exchange access provided by the Bell op15 erating company or its affiliates to itself or its affili16 ates; and

17 ‘‘(3) provide telephone exchange service and ex18 change access to all providers of intraLATA or

19 interLATA telephone toll services and interLATA in20 formation services at cost-based rates that are not un21 reasonably discriminatory.

22 ‘‘(j) CHARGES FOR ACCESS SERVICES.—A Bell operat23 ing company or an affiliate thereof shall charge the subsidi24 ary required by this section an amount for telephone ex25 change services, exchange access, and other necessary associ-
38

•S 652 EAH

1 ated inputs no less than the rate charged to any unaffiliated

2 entity for such access and inputs.

3 ‘‘(k) SUNSET.—The provisions of this section shall

4 cease to apply to any Bell operating company in any State

5 18 months after the date such Bell operating company is

6 authorized pursuant to section 245(c) to provide interLATA

7 telecommunications services in such State.

8 ‘‘SEC. 247. UNIVERSAL SERVICE.

9 ‘‘(a) JOINT BOARD TO PRESERVE UNIVERSAL SERV10 ICE.—Within 30 days after the date of enactment of this

11 part, the Commission shall convene a Federal-State Joint

12 Board under section 410(c) for the purpose of recommend13 ing actions to the Commission and State commissions for

14 the preservation of universal service in furtherance of the

15 purposes set forth in section 1 of this Act. In addition to

16 the members required under section 410(c), one member of

17 the Joint Board shall be a State-appointed utility consumer

18 advocate nominated by a national organization of State

19 utility consumer advocates.

20 ‘‘(b) PRINCIPLES.—The Joint Board shall base policies

21 for the preservation of universal service on the following

22 principles:

23 ‘‘(1) JUST AND REASONABLE RATES.—A plan

24 adopted by the Commission and the States should en25 sure the continued viability of universal service by
39

•S 652 EAH

1 maintaining quality services at just and reasonable

2 rates.

3 ‘‘(2) DEFINITIONS OF INCLUDED SERVICES; COM4 PARABILITY IN URBAN AND RURAL AREAS.—Such

5 plan should recommend a definition of the nature and

6 extent of the services encompassed within carriers’

7 universal service obligations. Such plan should seek to

8 promote access to advanced telecommunications serv9 ices and capabilities, and to promote reasonably com10 parable services for the general public in urban and

11 rural areas, while maintaining just and reasonable

12 rates.

13 ‘‘(3) ADEQUATE AND SUSTAINABLE SUPPORT

14 MECHANISMS.—Such plan should recommend specific

15 and predictable mechanisms to provide adequate and

16 sustainable support for universal service.

17 ‘‘(4) EQUITABLE AND NONDISCRIMINATORY CON18 TRIBUTIONS.—All providers of telecommunications

19 services should make an equitable and nondiscrim20 inatory contribution to the preservation of universal

21 service.

22 ‘‘(5) EDUCATIONAL ACCESS TO ADVANCED TELE23 COMMUNICATIONS SERVICES.—To the extent that a

24 common carrier establishes advanced telecommuni25 cations services, such plan should include rec-
40

•S 652 EAH

1 ommendations to ensure access to advanced tele2 communications services for students in elementary

3 and secondary schools.

4 ‘‘(6) ADDITIONAL PRINCIPLES.—Such other prin5 ciples as the Board determines are necessary and ap6 propriate for the protection of the public interest, con7 venience, and necessity and consistent with the pur8 poses of this Act.

9 ‘‘(c) DEFINITION OF UNIVERSAL SERVICE.—In rec10 ommending a definition of the nature and extent of the serv11 ices encompassed within carriers’ universal service obliga12 tions under subsection (b)(2), the Joint Board shall consider

13 the extent to which—

14 ‘‘(1) a telecommunications service has, through

15 the operation of market choices by customers, been

16 subscribed to by a substantial majority of residential

17 customers;

18 ‘‘(2) such service or capability is essential to

19 public health, public safety, or the public interest;

20 ‘‘(3) such service has been deployed in the public

21 switched telecommunications network; and

22 ‘‘(4) inclusion of such service within carriers’

23 universal service obligations is otherwise consistent

24 with the public interest, convenience, and necessity.
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•S 652 EAH

1 The Joint Board may, from time to time, recommend to

2 the Commission modifications in the definition proposed

3 under subsection (b).

4 ‘‘(d) REPORT; COMMISSION RESPONSE.—The Joint

5 Board convened pursuant to subsection (a) shall report its

6 recommendations within 6 months after the date of enact7 ment of this part. The Commission shall complete any pro8 ceeding to act upon such recommendations and to comply

9 with the principles set forth in subsection (b) within one

10 year after such date of enactment.

11 ‘‘(e) STATE AUTHORITY.—Nothing in this section shall

12 be construed to restrict the authority of any State to adopt

13 regulations imposing universal service obligations on the

14 provision of intrastate telecommunications services.

15 ‘‘(f) SUNSET.—The Joint Board established by this sec16 tion shall cease to exist 5 years after the date of enactment

17 of this part.

18 ‘‘SEC. 248. PRICING FLEXIBILITY AND ABOLITION OF RATE19 OF-RETURN REGULATION.

20 ‘‘(a) PRICING FLEXIBILITY.—

21 ‘‘(1) COMMISSION CRITERIA.—Within 270 days

22 after the date of enactment of this part, the Commis23 sion shall complete all actions necessary (including

24 any reconsideration) to establish—
42

•S 652 EAH

1 ‘‘(A) criteria for determining whether a tele2 communications service or provider of such serv3 ice has become, or is substantially certain to be4 come, subject to competition, either within a geo5 graphic area or within a class or category of

6 service; and

7 ‘‘(B) appropriate flexible pricing procedures

8 that afford a regulated provider of a service de9 scribed in subparagraph (A) the opportunity to

10 respond fairly to such competition and that are

11 consistent with the protection of subscribers and

12 the public interest, convenience, and necessity.

13 In establishing criteria and procedures pursuant to

14 this paragraph, the Commission shall take into ac15 count and accommodate, to the extent reasonable and

16 consistent with the purposes of this section, the cri17 teria and procedures established for such purposes by

18 State commissions prior to the effective date of the

19 Commission’s criteria and procedures under this sec20 tion.

21 ‘‘(2) STATE SELECTION.—A State commission

22 may utilize the flexible pricing procedures or proce23 dures (established under paragraph (1)(B)) that are

24 appropriate in light of the criteria established under

25 paragraph (1)(A).
43

•S 652 EAH

1 ‘‘(3) DETERMINATIONS.—The Commission, with

2 respect to rates for interstate or foreign communica3 tions, and State commissions, with respect to rates for

4 intrastate communications, shall, upon application—

5 ‘‘(A) render determinations in accordance

6 with the criteria established under paragraph

7 (1)(A) concerning the services or providers that

8 are the subject of such application; and

9 ‘‘(B) upon a proper showing, implement

10 appropriate flexible pricing procedures consistent

11 with paragraphs (1)(B) and (2) with respect to

12 such services or providers.

13 The Commission and such State commission shall ap14 prove or reject any such application within 180 days

15 after the date of its submission.

16 ‘‘(4) RESPONSE TO COMPETITION.—Pricing flexi17 bility implemented pursuant to this subsection shall

18 permit regulated telecommunications providers to re19 spond fairly to competition by repricing services sub20 ject to competition, but shall not have the effect of

21 changing prices for noncompetitive services or using

22 noncompetitive services to subsidize competitive serv23 ices.

24 ‘‘(b) ABOLITION OF RATE-OF-RETURN REGULATION.—

25 Notwithstanding any other provision of law, to the extent
44

•S 652 EAH

1 that a carrier has complied with sections 242 and 244 of

2 this part, the Commission, with respect to rates for inter3 state or foreign communications, and State commissions,

4 with respect to rates for intrastate communications, shall

5 not require rate-of-return regulation.

6 ‘‘(c) TERMINATION OF PRICE AND OTHER REGULA7 TION.—Notwithstanding any other provision of law, to the

8 extent that a carrier has complied with sections 242 and

9 244 of this part, the Commission, with respect to interstate

10 or foreign communications, and State commissions, with

11 respect to intrastate communications, shall not, for any

12 service that is determined, in accordance with the criteria

13 established under subsection (a)(1)(A), to be subject to com14 petition that effectively prevents prices for such service that

15 are unjust or unreasonable or unjustly or unreasonably dis16 criminatory—

17 ‘‘(1) regulate the prices for such service;

18 ‘‘(2) require the filing of a schedule of charges for

19 such service;

20 ‘‘(3) require the filing of any cost or revenue pro21 jections for such service;

22 ‘‘(4) regulate the depreciation charges for facili23 ties used to provide such service; or
45

•S 652 EAH

1 ‘‘(5) require prior approval for the construction

2 or extension of lines or other equipment for the provi3 sion of such service.

4 ‘‘(d) ABILITY TO CONTINUE AFFORDABLE VOICE5 GRADE SERVICE.—Notwithstanding subsections (a), (b),

6 and (c), each State commission shall, for a period of not

7 more than 3 years, permit residential subscribers to con8 tinue to receive only basic voice-grade local telephone service

9 equivalent to the service generally available to residential

10 subscribers on the date of enactment of this part, at just,

11 reasonable, and affordable rates. Determinations concerning

12 the affordability of rates for such services shall take into

13 account the rates generally available to residential subscrib14 ers on such date of enactment and the pricing rules estab15 lished by the States. Any increases in the rates for such

16 services for residential subscribers that are not attributable

17 to changes in consumer prices generally shall be permitted

18 in any proceeding commenced after the date of enactment

19 of this section upon a showing that such increase is nec20 essary to ensure the continued availability of universal serv21 ice, prevent economic disadvantages for one or more service

22 providers, and is in the public interest. Such increase in

23 rates shall be minimized to the greatest extent practical and

24 shall be implemented over a time period of not more than

25 3 years after the the date of enactment of this section. The
46

•S 652 EAH

1 requirements of this subsection shall not apply to any rural

2 telephone company if the rates for basic voice-grade local

3 telephone service of that company are not subject to regula4 tion by a State commission on the date of enactment of

5 this part.

6 ‘‘(e) INTEREXCHANGE SERVICE.—The rates charged by

7 providers of interexchange telecommunications service to

8 customers in rural and high cost areas shall be maintained

9 at levels no higher than those charged by each such provider

10 to its customers in urban areas.

11 ‘‘(f) EXCEPTION.—In the case of commercial mobile

12 services, the provisions of section 332(c)(1) shall apply in

13 lieu of the provisions of this section.

14 ‘‘(g) AVOIDANCE OF REDUNDANT REGULATIONS.—

15 ‘‘(1) COMMISSION REGULATIONS.—Nothing in

16 this section shall be construed to prohibit the Commis17 sion from enforcing regulations prescribed prior to the

18 date of enactment of this part in fulfilling the re19 quirements of this section, to the extent that such reg20 ulations are consistent with the provisions of this sec21 tion.

22 ‘‘(2) STATE REGULATIONS.—Nothing in this sec23 tion shall be construed to prohibit any State commis24 sion from enforcing regulations prescribed prior to the

25 effective date of the Commission’s criteria and proce-
47

•S 652 EAH

1 dures under this section in fulfilling the requirements

2 of this section, or from prescribing regulations after

3 such date, to the extent such regulations are consist4 ent—

5 ‘‘(A) with the provisions of this section; and

6 ‘‘(B) after such effective date, with such cri7 teria and procedures.

8 ‘‘SEC. 249. NETWORK FUNCTIONALITY AND ACCESSIBILITY.

9 ‘‘(a) FUNCTIONALITY AND ACCESSIBILITY.—The duty

10 of a common carrier under section 201(a) to furnish com11 munications service includes the duty to furnish that service

12 in accordance with any standards established pursuant to

13 this section.

14 ‘‘(b) COORDINATION FOR INTERCONNECTIVITY.—The

15 Commission—

16 ‘‘(1) shall establish procedures for Commission

17 oversight of coordinated network planning by common

18 carriers and other providers of telecommunications

19 services for the effective and efficient interconnection

20 of public switched networks; and

21 ‘‘(2) may participate, in a manner consistent

22 with its authority and practice prior to the date of

23 enactment of this section, in the development by ap24 propriate industry standards-setting organizations of

25 interconnection standards that promote access to—
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•S 652 EAH

1 ‘‘(A) network capabilities and services by

2 individuals with disabilities; and

3 ‘‘(B) information services by subscribers to

4 telephone exchange service furnished by a rural

5 telephone company.

6 ‘‘(c) ACCESSIBILITY FOR INDIVIDUALS WITH DISABIL7 ITIES.—

8 ‘‘(1) ACCESSIBILITY.—Within 1 year after the

9 date of enactment of this section, the Commission

10 shall prescribe such regulations as are necessary to

11 ensure that, if readily achievable, advances in net12 work services deployed by common carriers, and tele13 communications equipment and customer premises

14 equipment manufactured for use in conjunction with

15 network services, shall be accessible and usable by in16 dividuals with disabilities, including individuals with

17 functional limitations of hearing, vision, movement,

18 manipulation, speech, and interpretation of informa19 tion. Such regulations shall permit the use of both

20 standard and special equipment, and seek to mini21 mize the need of individuals to acquire additional de22 vices beyond those used by the general public to ob23 tain such access. Throughout the process of developing

24 such regulations, the Commission shall coordinate

25 and consult with representatives of individuals with
49

•S 652 EAH

1 disabilities and interested equipment and service pro2 viders to ensure their concerns and interests are given

3 full consideration in such process.

4 ‘‘(2) COMPATIBILITY.—Such regulations shall re5 quire that whenever the requirements of paragraph

6 (1) are not readily achievable, the local exchange car7 rier that deploys the network service shall ensure that

8 the network service in question is compatible with ex9 isting peripheral devices or specialized customer

10 premises equipment commonly used by persons with

11 disabilities to achieve access, unless doing so is not

12 readily achievable.

13 ‘‘(3) READILY ACHIEVEABLE.—The term ‘readily

14 achievable’ has the meaning given it by section 301(g)

15 of the Americans with Disabilities Act 1990 (42

16 U.S.C. 12102(g)).

17 ‘‘(4) EFFECTIVE DATE.—The regulations re18 quired by this subsection shall become effective 18

19 months after the date of enactment of this part.

20 ‘‘(d) PRIVATE RIGHTS OF ACTIONS PROHIBITED.—

21 Nothing in this section shall be construed to authorize any

22 private right of action to enforce any requirement of this

23 section or any regulation thereunder. The Commission shall

24 have exclusive jurisdiction with respect to any complaint

25 under this section.
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1 ‘‘SEC. 250. MARKET ENTRY BARRIERS.

2 ‘‘(a) ELIMINATION OF BARRIERS.—Within 15 months

3 after the date of enactment of this part, the Commission

4 shall complete a proceeding for the purpose of identifying

5 and eliminating, by regulations pursuant to its authority

6 under this Act (other than this section), market entry bar7 riers for entrepreneurs and other small businesses in the

8 provision and ownership of telecommunications services

9 and information services, or in the provision of parts or

10 services to providers of telecommunications services and in11 formation services.

12 ‘‘(b) NATIONAL POLICY.—In carrying out subsection

13 (a), the Commission shall seek to promote the policies and

14 purposes of this Act favoring diversity of media voices, vig15 orous economic competition, technological advancement,

16 and promotion of the public interest, convenience, and ne17 cessity.

18 ‘‘(c) PERIODIC REVIEW.—Every 3 years following the

19 completion of the proceeding required by subsection (a), the

20 Commission shall review and report to Congress on—

21 ‘‘(1) any regulations prescribed to eliminate bar22 riers within its jurisdiction that are identified under

23 subsection (a) and that can be prescribed consistent

24 with the public interest, convenience, and necessity;

25 and
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1 ‘‘(2) the statutory barriers identified under sub2 section (a) that the Commission recommends be elimi3 nated, consistent with the public interest, convenience,

4 and necessity.

5 ‘‘SEC. 251. ILLEGAL CHANGES IN SUBSCRIBER CARRIER SE6 LECTIONS.

7 ‘‘(a) PROHIBITION .—No common carrier shall submit

8 or execute a change in a subscriber’s selection of a provider

9 of telephone exchange service or telephone toll service except

10 in accordance with such verification procedures as the Com11 mission shall prescribe. Nothing in this section shall pre12 clude any State commission from enforcing such procedures

13 with respect to intrastate services.

14 ‘‘(b) LIABILITY FOR CHARGES.—Any common carrier

15 that violates the verification procedures described in sub16 section (a) and that collects charges for telephone exchange

17 service or telephone toll service from a subscriber shall be

18 liable to the carrier previously selected by the subscriber in

19 an amount equal to all charges paid by such subscriber after

20 such violation, in accordance with such procedures as the

21 Commission may prescribe. The remedies provided by this

22 subsection are in addition to any other remedies available

23 by law.
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1 ‘‘SEC. 252. STUDY.

2 ‘‘Within 3 years after the date of enactment of this

3 part, the Commission shall conduct a study that—

4 ‘‘(1) reviews the definition of, and the adequacy

5 of support for, universal service, and evaluates the ex6 tent to which universal service has been protected and

7 access to advanced services has been facilitated pursu8 ant to this part and the plans and regulations there9 under;

10 ‘‘(2) evaluates the extent to which access to ad11 vanced telecommunications services for students in el12 ementary and secondary school classrooms has been

13 attained pursuant to section 247(b)(5); and

14 ‘‘(3) determines whether the regulations estab15 lished under section 249(c) have ensured that ad16 vances in network services by providers of tele17 communications services and information services are

18 accessible and usable by individuals with disabil19 ities.’’.

20 (b) CONSOLIDATED RULEMAKING PROCEEDING.—The

21 Commission shall conduct a single consolidated rulemaking

22 proceeding to prescribe or amend regulations necessary to

23 implement the requirements of—

24 (1) part II of title II of the Act as added by sub25 section (a) of this section;
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1 (2) section 222 as amended by section 104 of this

2 Act; and

3 (3) section 224 as amended by section 105 of this

4 Act.

5 (c) DESIGNATION OF PART I.—Title II of the Act is

6 further amended by inserting before the heading of section

7 201 the following new heading:

8 ‘‘PART I—REGULATION OF DOMINANT COMMON

9 CARRIERS’’.

10 (d) SYLISTIC CONSISTENCY.—The Act is amended so

11 that—

12 (1) the designation and heading of each title of

13 the Act shall be in the form and typeface of the des14 ignation and heading of this title of this Act; and

15 (2) the designation and heading of each part of

16 each title of the Act shall be in the form and typeface

17 of the designation and heading of part I of title II

18 of the Act, as amended by subsection (c).

19 (e) CONFORMING AMENDMENTS.—

20 (1) FEDERAL-STATE JURISDICTION.—Section

21 2(b) of the Act (47 U.S.C. 152(b)) is amended by in22 serting ‘‘part II of title II,’’ after ‘‘227, inclusive,’’.

23 (2) FORFEITURES.—Sections 503(b)(1) and

24 504(b) of such Act (47 U.S.C. 503(b)) are each

25 amended by inserting ‘‘part I of’’ before ‘‘title II’’.
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1 SEC. 102. COMPETITION IN MANUFACTURING, INFORMA2 TION SERVICES, ALARM SERVICES, AND PAY3 PHONE SERVICES.

4 (a) COMPETITION IN MANUFACTURING, INFORMATION

5 SERVICES, AND ALARM SERVICES.—Title II of the Act is

6 amended by adding at the end of part II (as added by sec7 tion 101) the following new part:

8 ‘‘PART III—SPECIAL AND TEMPORARY

9 PROVISIONS

10 ‘‘SEC. 271. MANUFACTURING BY BELL OPERATING COMPA11 NIES.

12 ‘‘(a) LIMITATIONS ON MANUFACTURING.—

13 ‘‘(1) ACCESS AND INTERCONNECTION RE14 QUIRED.—It shall be unlawful for a Bell operating

15 company, directly or through an affiliate, to manu16 facture telecommunications equipment or customer

17 premises equipment, until the Commission has ap18 proved under section 245(c) verifications that such

19 Bell operating company, and each Bell operating

20 company with which it is affiliated, are in compli21 ance with the access and interconnection requirements

22 of part II of this title.

23 ‘‘(2) SEPARATE SUBSIDIARY REQUIRED.—During

24 the first 18 months after the expiration of the limita25 tion contained in paragraph (1), a Bell operating

26 company may engage in manufacturing telecommuni-
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1 cations equipment or customer premises equipment

2 only through a separate subsidiary established and

3 operated in accordance with section 246.

4 ‘‘(b) COLLABORATION; RESEARCH AND ROYALTY

5 AGREEMENTS.—

6 ‘‘(1) COLLABORATION.—Subsection (a) shall not

7 prohibit a Bell operating company from engaging in

8 close collaboration with any manufacturer of cus9 tomer premises equipment or telecommunications

10 equipment during the design and development of

11 hardware, software, or combinations thereof related to

12 such equipment.

13 ‘‘(2) RESEARCH; ROYALTY AGREEMENTS.—Sub14 section (a) shall not prohibit a Bell operating com15 pany, directly or through an subsidiary, from—

16 ‘‘(A) engaging in any research activities re17 lated to manufacturing, and

18 ‘‘(B) entering into royalty agreements with

19 manufacturers of telecommunications equipment.

20 ‘‘(c) INFORMATION REQUIREMENTS.—

21 ‘‘(1) INFORMATION ON PROTOCOLS AND TECH22 NICAL REQUIREMENTS.—Each Bell operating com23 pany shall, in accordance with regulations prescribed

24 by the Commission, maintain and file with the Com25 mission full and complete information with respect to
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1 the protocols and technical requirements for connec2 tion with and use of its telephone exchange service fa3 cilities. Each such company shall report promptly to

4 the Commission any material changes or planned

5 changes to such protocols and requirements, and the

6 schedule for implementation of such changes or

7 planned changes.

8 ‘‘(2) DISCLOSURE OF INFORMATION.—A Bell op9 erating company shall not disclose any information

10 required to be filed under paragraph (1) unless that

11 information has been filed promptly, as required by

12 regulation by the Commission.

13 ‘‘(3) ACCESS BY COMPETITORS TO INFORMA14 TION.—The Commission may prescribe such addi15 tional regulations under this subsection as may be

16 necessary to ensure that manufacturers have access to

17 the information with respect to the protocols and tech18 nical requirements for connection with and use of

19 telephone exchange service facilities that a Bell oper20 ating company makes available to any manufactur21 ing affiliate or any unaffiliated manufacturer.

22 ‘‘(4) PLANNING INFORMATION.—Each Bell oper23 ating company shall provide, to contiguous common

24 carriers providing telephone exchange service, timely
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1 information on the planned deployment of tele2 communications equipment.

3 ‘‘(d) MANUFACTURING LIMITATIONS FOR STANDARD4 SETTING ORGANIZATIONS.—

5 ‘‘(1) APPLICATION TO BELL COMMUNICATIONS

6 RESEARCH OR MANUFACTURERS.—Bell Communica7 tions Research, Inc., or any successor entity or affili8 ate—

9 ‘‘(A) shall not be considered a Bell operat10 ing company or a successor or assign of a Bell

11 operating company at such time as it is no

12 longer an affiliate of any Bell operating com13 pany; and

14 ‘‘(B) notwithstanding paragraph (3), shall

15 not engage in manufacturing telecommuni16 cations equipment or customer premises equip17 ment as long as it is an affiliate of more than

18 1 otherwise unaffiliated Bell operating company

19 or successor or assign of any such company.

20 Nothing in this subsection prohibits Bell Communica21 tions Research, Inc., or any successor entity, from en22 gaging in any activity in which it is lawfully en23 gaged on the date of enactment of this subsection.

24 Nothing provided in this subsection shall render Bell

25 Communications Research, Inc., or any successor en-
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1 tity, a common carrier under title II of this Act.

2 Nothing in this section restricts any manufacturer

3 from engaging in any activity in which it is lawfully

4 engaged on the date of enactment of this section.

5 ‘‘(2) PROPRIETARY INFORMATION.—Any entity

6 which establishes standards for telecommunications

7 equipment or customer premises equipment, or ge8 neric network requirements for such equipment, or

9 certifies telecommunications equipment, or customer

10 premises equipment, shall be prohibited from releas11 ing or otherwise using any proprietary information,

12 designated as such by its owner, in its possession as

13 a result of such activity, for any purpose other than

14 purposes authorized in writing by the owner of such

15 information, even after such entity ceases to be so en16 gaged.

17 ‘‘(3) MANUFACTURING SAFEGUARDS.—(A) Ex18 cept as prohibited in paragraph (1), and subject to

19 paragraph (6), any entity which certifies tele20 communications equipment or customer premises

21 equipment manufactured by an unaffiliated entity

22 shall only manufacture a particular class of tele23 communications equipment or customer premises

24 equipment for which it is undertaking or has under25 taken, during the previous 18 months, certification
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1 activity for such class of equipment through a sepa2 rate affiliate.

3 ‘‘(B) Such separate affiliate shall—

4 ‘‘(i) maintain books, records, and accounts

5 separate from those of the entity that certifies

6 such equipment, consistent with generally accept7 able accounting principles;

8 ‘‘(ii) not engage in any joint manufactur9 ing activities with such entity; and

10 ‘‘(iii) have segregated facilities and separate

11 employees with such entity.

12 ‘‘(C) Such entity that certifies such equipment

13 shall—

14 ‘‘(i) not discriminate in favor of its manu15 facturing affiliate in the establishment of stand16 ards, generic requirements, or product certifi17 cation;

18 ‘‘(ii) not disclose to the manufacturing affil19 iate any proprietary information that has been

20 received at any time from an unaffiliated manu21 facturer, unless authorized in writing by the

22 owner of the information; and

23 ‘‘(iii) not permit any employee engaged in

24 product certification for telecommunications

25 equipment or customer premises equipment to
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1 engage jointly in sales or marketing of any such

2 equipment with the affiliated manufacturer.

3 ‘‘(4) STANDARD-SETTING ENTITIES.—Any entity

4 which is not an accredited standards development or5 ganization and which establishes industry-wide

6 standards for telecommunications equipment or cus7 tomer premises equipment, or industry-wide generic

8 network requirements for such equipment, or which

9 certifies telecommunications equipment or customer

10 premises equipment manufactured by an unaffiliated

11 entity, shall—

12 ‘‘(A) establish and publish any industry13 wide standard for, industry-wide generic require14 ment for, or any substantial modification of an

15 existing industry-wide standard or industry16 wide generic requirement for, telecommuni17 cations equipment or customer premises equip18 ment only in compliance with the following pro19 cedure:

20 ‘‘(i) such entity shall issue a public no21 tice of its consideration of a proposed in22 dustry-wide standard or industry-wide ge23 neric requirement;

24 ‘‘(ii) such entity shall issue a public

25 invitation to interested industry parties to
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1 fund and participate in such efforts on a

2 reasonable and nondiscriminatory basis,

3 administered in such a manner as not to

4 unreasonably exclude any interested indus5 try party;

6 ‘‘(iii) such entity shall publish a text

7 for comment by such parties as have agreed

8 to participate in the process pursuant to

9 clause (ii), provide such parties a full op10 portunity to submit comments, and respond

11 to comments from such parties;

12 ‘‘(iv) such entity shall publish a final

13 text of the industry-wide standard or indus14 try-wide generic requirement, including the

15 comments in their entirety, of any funding

16 party which requests to have its comments

17 so published; and

18 ‘‘(v) such entity shall attempt, prior to

19 publishing a text for comment, to agree with

20 the funding parties as a group on a mutu21 ally satisfactory dispute resolution process

22 which such parties shall utilize as their sole

23 recourse in the event of a dispute on tech24 nical issues as to which there is disagree25 ment between any funding party and the
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1 entity conducting such activities, except

2 that if no dispute resolution process is

3 agreed to by all the parties, a funding party

4 may utilize the dispute resolution proce5 dures established pursuant to paragraph (5)

6 of this subsection;

7 ‘‘(B) engage in product certification for tele8 communications equipment or customer premises

9 equipment manufactured by unaffiliated entities

10 only if—

11 ‘‘(i) such activity is performed pursu12 ant to published criteria;

13 ‘‘(ii) such activity is performed pursu14 ant to auditable criteria; and

15 ‘‘(iii) such activity is performed pursu16 ant to available industry-accepted testing

17 methods and standards, where applicable,

18 unless otherwise agreed upon by the parties

19 funding and performing such activity;

20 ‘‘(C) not undertake any actions to monopo21 lize or attempt to monopolize the market for such

22 services; and

23 ‘‘(D) not preferentially treat its own tele24 communications equipment or customer premises

25 equipment, or that of its affiliate, over that of
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1 any other entity in establishing and publishing

2 industry-wide standards or industry-wide ge3 neric requirements for, and in certification of,

4 telecommunications equipment and customer

5 premises equipment.

6 ‘‘(5) ALTERNATE DISPUTE RESOLUTION.—With7 in 90 days after the date of enactment of this section,

8 the Commission shall prescribe a dispute resolution

9 process to be utilized in the event that a dispute reso10 lution process is not agreed upon by all the parties

11 when establishing and publishing any industry-wide

12 standard or industry-wide generic requirement for

13 telecommunications equipment or customer premises

14 equipment, pursuant to paragraph (4)(A)(v). The

15 Commission shall not establish itself as a party to the

16 dispute resolution process. Such dispute resolution

17 process shall permit any funding party to resolve a

18 dispute with the entity conducting the activity that

19 significantly affects such funding party’s interests, in

20 an open, nondiscriminatory, and unbiased fashion,

21 within 30 days after the filing of such dispute. Such

22 disputes may be filed within 15 days after the date

23 the funding party receives a response to its comments

24 from the entity conducting the activity. The Commis25 sion shall establish penalties to be assessed for delays
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1 caused by referral of frivolous disputes to the dispute

2 resolution process. The overall intent of establishing

3 this dispute resolution provision is to enable all inter4 ested funding parties an equal opportunity to influ5 ence the final resolution of the dispute without sig6 nificantly impairing the efficiency, timeliness, and

7 technical quality of the activity.

8 ‘‘(6) SUNSET.—The requirements of paragraphs

9 (3) and (4) shall terminate for the particular relevant

10 activity when the Commission determines that there

11 are alternative sources of industry-wide standards,

12 industry-wide generic requirements, or product cer13 tification for a particular class of telecommunications

14 equipment or customer premises equipment available

15 in the United States. Alternative sources shall be

16 deemed to exist when such sources provide commer17 cially viable alternatives that are providing such serv18 ices to customers. The Commission shall act on any

19 application for such a determination within 90 days

20 after receipt of such application, and shall receive

21 public comment on such application.

22 ‘‘(7) ADMINISTRATION AND ENFORCEMENT AU23 THORITY.—For the purposes of administering this

24 subsection and the regulations prescribed thereunder,

25 the Commission shall have the same remedial author-
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1 ity as the Commission has in administering and en2 forcing the provisions of this title with respect to any

3 common carrier subject to this Act.

4 ‘‘(8) DEFINITIONS.—For purposes of this sub5 section:

6 ‘‘(A) The term ‘affiliate’ shall have the same

7 meaning as in section 3 of this Act, except that,

8 for purposes of paragraph (1)(B)—

9 ‘‘(i) an aggregate voting equity interest

10 in Bell Communications Research, Inc., of

11 at least 5 percent of its total voting equity,

12 owned directly or indirectly by more than 1

13 otherwise unaffiliated Bell operating com14 pany, shall constitute an affiliate relation15 ship; and

16 ‘‘(ii) a voting equity interest in Bell

17 Communications Research, Inc., by any

18 otherwise unaffiliated Bell operating com19 pany of less than 1 percent of Bell Commu20 nications Research’s total voting equity

21 shall not be considered to be an equity in22 terest under this paragraph.

23 ‘‘(B) The term ‘generic requirement’ means

24 a description of acceptable product attributes for

25 use by local exchange carriers in establishing
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1 product specifications for the purchase of tele2 communications equipment, customer premises

3 equipment, and software integral thereto.

4 ‘‘(C) The term ‘industry-wide’ means activi5 ties funded by or performed on behalf of local ex6 change carriers for use in providing wireline

7 local exchange service whose combined total of

8 deployed access lines in the United States con9 stitutes at least 30 percent of all access lines de10 ployed by telecommunications carriers in the

11 United States as of the date of enactment.

12 ‘‘(D) The term ‘certification’ means any

13 technical process whereby a party determines

14 whether a product, for use by more than one

15 local exchange carrier, conforms with the speci16 fied requirements pertaining to such product.

17 ‘‘(E) The term ‘accredited standards devel18 opment organization’ means an entity composed

19 of industry members which has been accredited

20 by an institution vested with the responsibility

21 for standards accreditation by the industry.

22 ‘‘(e) BELL OPERATING COMPANY EQUIPMENT PRO23 CUREMENT AND SALES.—

24 ‘‘(1) OBJECTIVE BASIS.—Each Bell operating

25 company and any entity acting on behalf of a Bell
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1 operating company shall make procurement decisions

2 and award all supply contracts for equipment, serv3 ices, and software on the basis of an objective assess4 ment of price, quality, delivery, and other commercial

5 factors.

6 ‘‘(2) SALES RESTRICTIONS.—A Bell operating

7 company engaged in manufacturing may not restrict

8 sales to any local exchange carrier of telecommuni9 cations equipment, including software integral to the

10 operation of such equipment and related upgrades.

11 ‘‘(3) PROTECTION OF PROPRIETARY INFORMA12 TION.—A Bell operating company and any entity it

13 owns or otherwise controls shall protect the propri14 etary information submitted for procurement deci15 sions from release not specifically authorized by the

16 owner of such information.

17 ‘‘(f) ADMINISTRATION AND ENFORCEMENT AUTHOR18 ITY.—For the purposes of administering and enforcing the

19 provisions of this section and the regulations prescribed

20 thereunder, the Commission shall have the same authority,

21 power, and functions with respect to any Bell operating

22 company or any affiliate thereof as the Commission has in

23 administering and enforcing the provisions of this title with

24 respect to any common carrier subject to this Act.
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1 ‘‘(g) EXCEPTION FOR PREVIOUSLY AUTHORIZED AC2 TIVITIES.—Nothing in this section shall prohibit a Bell op3 erating company or affiliate from engaging, at any time

4 after the date of the enactment of this part, in any activity

5 as authorized by an order entered by the United States Dis6 trict Court for the District of Columbia pursuant to section

7 VII or VIII(C) of the Modification of Final Judgment, if—

8 ‘‘(1) such order was entered on or before the date

9 of the enactment of this part, or

10 ‘‘(2) a request for such authorization was pend11 ing before such court on the date of the enactment of

12 this part.

13 ‘‘(h) ANTITRUST LAWS.—Nothing in this section shall

14 be construed to modify, impair, or supersede the applicabil15 ity of any of the antitrust laws.

16 ‘‘(i) DEFINITION.—As used in this section, the term

17 ‘manufacturing’ has the same meaning as such term has

18 under the Modification of Final Judgment.

19 ‘‘SEC. 272. ELECTRONIC PUBLISHING BY BELL OPERATING

20 COMPANIES.

21 ‘‘(a) LIMITATIONS.—No Bell operating company or

22 any affiliate may engage in the provision of electronic pub23 lishing that is disseminated by means of such Bell operating

24 company’s or any of its affiliates’ basic telephone service,

25 except that nothing in this section shall prohibit a separated
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1 affiliate or electronic publishing joint venture operated in

2 accordance with this section from engaging in the provision

3 of electronic publishing.

4 ‘‘(b) SEPARATED AFFILIATE OR ELECTRONIC PUB5 LISHING JOINT VENTURE REQUIREMENTS.—A separated

6 affiliate or electronic publishing joint venture shall be oper7 ated independently from the Bell operating company. Such

8 separated affiliate or joint venture and the Bell operating

9 company with which it is affiliated shall—

10 ‘‘(1) maintain separate books, records, and ac11 counts and prepare separate financial statements;

12 ‘‘(2) not incur debt in a manner that would per13 mit a creditor of the separated affiliate or joint ven14 ture upon default to have recourse to the assets of the

15 Bell operating company;

16 ‘‘(3) carry out transactions (A) in a manner

17 consistent with such independence, (B) pursuant to

18 written contracts or tariffs that are filed with the

19 Commission and made publicly available, and (C) in

20 a manner that is auditable in accordance with gen21 erally accepted auditing standards;

22 ‘‘(4) value any assets that are transferred di23 rectly or indirectly from the Bell operating company

24 to a separated affiliate or joint venture, and record

25 any transactions by which such assets are transferred,
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1 in accordance with such regulations as may be pre2 scribed by the Commission or a State commission to

3 prevent improper cross subsidies;

4 ‘‘(5) between a separated affiliate and a Bell op5 erating company—

6 ‘‘(A) have no officers, directors, and employ7 ees in common after the effective date of this sec8 tion; and

9 ‘‘(B) own no property in common;

10 ‘‘(6) not use for the marketing of any product or

11 service of the separated affiliate or joint venture, the

12 name, trademarks, or service marks of an existing

13 Bell operating company except for names, trade14 marks, or service marks that are or were used in com15 mon with the entity that owns or controls the Bell op16 erating company;

17 ‘‘(7) not permit the Bell operating company—

18 ‘‘(A) to perform hiring or training of per19 sonnel on behalf of a separated affiliate;

20 ‘‘(B) to perform the purchasing, installa21 tion, or maintenance of equipment on behalf of

22 a separated affiliate, except for telephone service

23 that it provides under tariff or contract subject

24 to the provisions of this section; or
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1 ‘‘(C) to perform research and development

2 on behalf of a separated affiliate;

3 ‘‘(8) each have performed annually a compliance

4 review—

5 ‘‘(A) that is conducted by an independent

6 entity for the purpose of determining compliance

7 during the preceding calendar year with any

8 provision of this section; and

9 ‘‘(B) the results of which are maintained by

10 the separated affiliate or joint venture and the

11 Bell operating company for a period of 5 years

12 subject to review by any lawful authority; and

13 ‘‘(9) within 90 days of receiving a review de14 scribed in paragraph (8), file a report of any excep15 tions and corrective action with the Commission and

16 allow any person to inspect and copy such report sub17 ject to reasonable safeguards to protect any propri18 etary information contained in such report from

19 being used for purposes other than to enforce or pur20 sue remedies under this section.

21 ‘‘(c) JOINT MARKETING.—

22 ‘‘(1) IN GENERAL.—Except as provided in para23 graph (2)—

24 ‘‘(A) a Bell operating company shall not

25 carry out any promotion, marketing, sales, or
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1 advertising for or in conjunction with a sepa2 rated affiliate; and

3 ‘‘(B) a Bell operating company shall not

4 carry out any promotion, marketing, sales, or

5 advertising for or in conjunction with an affili6 ate that is related to the provision of electronic

7 publishing.

8 ‘‘(2) PERMISSIBLE JOINT ACTIVITIES.—

9 ‘‘(A) JOINT TELEMARKETING.—A Bell oper10 ating company may provide inbound

11 telemarketing or referral services related to the

12 provision of electronic publishing for a separated

13 affiliate, electronic publishing joint venture, af14 filiate, or unaffiliated electronic publisher, pro15 vided that if such services are provided to a sep16 arated affiliate, electronic publishing joint ven17 ture, or affiliate, such services shall be made

18 available to all electronic publishers on request,

19 on nondiscriminatory terms.

20 ‘‘(B) TEAMING ARRANGEMENTS.—A Bell op21 erating company may engage in nondiscrim22 inatory teaming or business arrangements to en23 gage in electronic publishing with any separated

24 affiliate or with any other electronic publisher if

25 (i) the Bell operating company only provides fa-
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1 cilities, services, and basic telephone service in2 formation as authorized by this section, and (ii)

3 the Bell operating company does not own such

4 teaming or business arrangement.

5 ‘‘(C) ELECTRONIC PUBLISHING JOINT VEN6 TURES.—A Bell operating company or affiliate

7 may participate on a nonexclusive basis in elec8 tronic publishing joint ventures with entities

9 that are not any Bell operating company, affili10 ate, or separated affiliate to provide electronic

11 publishing services, if the Bell operating com12 pany or affiliate has not more than a 50 percent

13 direct or indirect equity interest (or the equiva14 lent thereof) or the right to more than 50 percent

15 of the gross revenues under a revenue sharing or

16 royalty agreement in any electronic publishing

17 joint venture. Officers and employees of a Bell

18 operating company or affiliate participating in

19 an electronic publishing joint venture may not

20 have more than 50 percent of the voting control

21 over the electronic publishing joint venture. In

22 the case of joint ventures with small, local elec23 tronic publishers, the Commission for good cause

24 shown may authorize the Bell operating com25 pany or affiliate to have a larger equity interest,
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1 revenue share, or voting control but not to exceed

2 80 percent. A Bell operating company partici3 pating in an electronic publishing joint venture

4 may provide promotion, marketing, sales, or ad5 vertising personnel and services to such joint

6 venture.

7 ‘‘(d) BELL OPERATING COMPANY REQUIREMENT.—A

8 Bell operating company under common ownership or con9 trol with a separated affiliate or electronic publishing joint

10 venture shall provide network access and interconnections

11 for basic telephone service to electronic publishers at just

12 and reasonable rates that are tariffed (so long as rates for

13 such services are subject to regulation) and that are not

14 higher on a per-unit basis than those charged for such serv15 ices to any other electronic publisher or any separated affil16 iate engaged in electronic publishing.

17 ‘‘(e) PRIVATE RIGHT OF ACTION.—

18 ‘‘(1) DAMAGES.—Any person claiming that any

19 act or practice of any Bell operating company, affili20 ate, or separated affiliate constitutes a violation of

21 this section may file a complaint with the Commis22 sion or bring suit as provided in section 207 of this

23 Act, and such Bell operating company, affiliate, or

24 separated affiliate shall be liable as provided in sec25 tion 206 of this Act; except that damages may not
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1 be awarded for a violation that is discovered by a

2 compliance review as required by subsection (b)(7) of

3 this section and corrected within 90 days.

4 ‘‘(2) CEASE AND DESIST ORDERS.—In addition

5 to the provisions of paragraph (1), any person claim6 ing that any act or practice of any Bell operating

7 company, affiliate, or separated affiliate constitutes a

8 violation of this section may make application to the

9 Commission for an order to cease and desist such vio10 lation or may make application in any district court

11 of the United States of competent jurisdiction for an

12 order enjoining such acts or practices or for an order

13 compelling compliance with such requirement.

14 ‘‘(f) SEPARATED AFFILIATE REPORTING REQUIRE15 MENT.—Any separated affiliate under this section shall file

16 with the Commission annual reports in a form substan17 tially equivalent to the Form 10–K required by regulations

18 of the Securities and Exchange Commission.

19 ‘‘(g) EFFECTIVE DATES.—

20 ‘‘(1) TRANSITION.—Any electronic publishing

21 service being offered to the public by a Bell operating

22 company or affiliate on the date of enactment of this

23 section shall have one year from such date of enact24 ment to comply with the requirements of this section.
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1 ‘‘(2) SUNSET.—The provisions of this section

2 shall not apply to conduct occurring after June 30,

3 2000.

4 ‘‘(h) DEFINITION OF ELECTRONIC PUBLISHING.—

5 ‘‘(1) IN GENERAL.—The term ‘electronic publish6 ing’ means the dissemination, provision, publication,

7 or sale to an unaffiliated entity or person, of any one

8 or more of the following: news (including sports); en9 tertainment (other than interactive games); business,

10 financial, legal, consumer, or credit materials; edi11 torials, columns, or features; advertising; photos or

12 images; archival or research material; legal notices or

13 public records; scientific, educational, instructional,

14 technical, professional, trade, or other literary mate15 rials; or other like or similar information.

16 ‘‘(2) EXCEPTIONS.—The term ‘electronic publish17 ing’ shall not include the following services:

18 ‘‘(A) Information access, as that term is de19 fined by the Modification of Final Judgment.

20 ‘‘(B) The transmission of information as a

21 common carrier.

22 ‘‘(C) The transmission of information as

23 part of a gateway to an information service that

24 does not involve the generation or alteration of

25 the content of information, including data trans-
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1 mission, address translation, protocol conversion,

2 billing management, introductory information

3 content, and navigational systems that enable

4 users to access electronic publishing services,

5 which do not affect the presentation of such elec6 tronic publishing services to users.

7 ‘‘(D) Voice storage and retrieval services,

8 including voice messaging and electronic mail

9 services.

10 ‘‘(E) Data processing or transaction proc11 essing services that do not involve the generation

12 or alteration of the content of information.

13 ‘‘(F) Electronic billing or advertising of a

14 Bell operating company’s regulated telecommuni15 cations services.

16 ‘‘(G) Language translation or data format

17 conversion.

18 ‘‘(H) The provision of information nec19 essary for the management, control, or operation

20 of a telephone company telecommunications sys21 tem.

22 ‘‘(I) The provision of directory assistance

23 that provides names, addresses, and telephone

24 numbers and does not include advertising.

25 ‘‘(J) Caller identification services.
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1 ‘‘(K) Repair and provisioning databases

2 and credit card and billing validation for tele3 phone company operations.

4 ‘‘(L) 911–E and other emergency assistance

5 databases.

6 ‘‘(M) Any other network service of a type

7 that is like or similar to these network services

8 and that does not involve the generation or alter9 ation of the content of information.

10 ‘‘(N) Any upgrades to these network services

11 that do not involve the generation or alteration

12 of the content of information.

13 ‘‘(O) Video programming or full motion

14 video entertainment on demand.

15 ‘‘(i) ADDITIONAL DEFINITIONS.—As used in this sec16 tion—

17 ‘‘(1) The term ‘affiliate’ means any entity that,

18 directly or indirectly, owns or controls, is owned or

19 controlled by, or is under common ownership or con20 trol with, a Bell operating company. Such term shall

21 not include a separated affiliate.

22 ‘‘(2) The term ‘basic telephone service’ means

23 any wireline telephone exchange service, or wireline

24 telephone exchange service facility, provided by a Bell
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•S 652 EAH

1 operating company in a telephone exchange area, ex2 cept that such term does not include—

3 ‘‘(A) a competitive wireline telephone ex4 change service provided in a telephone exchange

5 area where another entity provides a wireline

6 telephone exchange service that was provided on

7 January 1, 1984, and

8 ‘‘(B) a commercial mobile service.

9 ‘‘(3) The term ‘basic telephone service informa10 tion’ means network and customer information of a

11 Bell operating company and other information ac12 quired by a Bell operating company as a result of its

13 engaging in the provision of basic telephone service.

14 ‘‘(4) The term ‘control’ has the meaning that it

15 has in 17 C.F.R. 240.12b–2, the regulations promul16 gated by the Securities and Exchange Commission

17 pursuant to the Securities Exchange Act of 1934 (15

18 U.S.C. 78a et seq.) or any successor provision to such

19 section.

20 ‘‘(5) The term ‘electronic publishing joint ven21 ture’ means a joint venture owned by a Bell operating

22 company or affiliate that engages in the provision of

23 electronic publishing which is disseminated by means

24 of such Bell operating company’s or any of its affili25 ates’ basic telephone service.
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•S 652 EAH

1 ‘‘(6) The term ‘entity’ means any organization,

2 and includes corporations, partnerships, sole propri3 etorships, associations, and joint ventures.

4 ‘‘(7) The term ‘inbound telemarketing’ means the

5 marketing of property, goods, or services by telephone

6 to a customer or potential customer who initiated the

7 call.

8 ‘‘(8) The term ‘own’ with respect to an entity

9 means to have a direct or indirect equity interest (or

10 the equivalent thereof) of more than 10 percent of an

11 entity, or the right to more than 10 percent of the

12 gross revenues of an entity under a revenue sharing

13 or royalty agreement.

14 ‘‘(9) The term ‘separated affiliate’ means a cor15 poration under common ownership or control with a

16 Bell operating company that does not own or control

17 a Bell operating company and is not owned or con18 trolled by a Bell operating company and that engages

19 in the provision of electronic publishing which is dis20 seminated by means of such Bell operating company’s

21 or any of its affiliates’ basic telephone service.

22 ‘‘(10) The term ‘Bell operating company’ has the

23 meaning provided in section 3, except that such term

24 includes any entity or corporation that is owned or

25 controlled by such a company (as so defined) but does
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•S 652 EAH

1 not include an electronic publishing joint venture

2 owned by such an entity or corporation.

3 ‘‘SEC. 273. ALARM MONITORING AND TELEMESSAGING

4 SERVICES BY BELL OPERATING COMPANIES.

5 ‘‘(a) DELAYED ENTRY INTO ALARM MONITORING.—

6 ‘‘(1) PROHIBITION.—No Bell operating company

7 or affiliate thereof shall engage in the provision of

8 alarm monitoring services before the date which is 6

9 years after the date of enactment of this part.

10 ‘‘(2) EXISTING ACTIVITIES.—Paragraph (1) shall

11 not apply to any provision of alarm monitoring serv12 ices in which a Bell operating company or affiliate

13 is lawfully engaged as of January 1, 1995.

14 ‘‘(b) NONDISCRIMINATION.—A common carrier en15 gaged in the provision of alarm monitoring services or

16 telemessaging services shall—

17 ‘‘(1) provide nonaffiliated entities, upon reason18 able request, with the network services it provides to

19 its own alarm monitoring or telemessaging oper20 ations, on nondiscriminatory terms and conditions;

21 and

22 ‘‘(2) not subsidize its alarm monitoring services

23 or its telemessaging services either directly or indi24 rectly from telephone exchange service operations.
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1 ‘‘(c) EXPEDITED CONSIDERATION OF COMPLAINTS.—

2 The Commission shall establish procedures for the receipt

3 and review of complaints concerning violations of sub4 section (b) or the regulations thereunder that result in mate5 rial financial harm to a provider of alarm monitoring serv6 ice or telemessaging service. Such procedures shall ensure

7 that the Commission will make a final determination with

8 respect to any such complaint within 120 days after receipt

9 of the complaint. If the complaint contains an appropriate

10 showing that the alleged violation occurred, as determined

11 by the Commission in accordance with such regulations, the

12 Commission shall, within 60 days after receipt of the com13 plaint, order the common carrier and its affiliates to cease

14 engaging in such violation pending such final determina15 tion.

16 ‘‘(d) DEFINITIONS.—As used in this section:

17 ‘‘(1) ALARM MONITORING SERVICE.—The term

18 ‘alarm monitoring service’ means a service that uses

19 a device located at a residence, place of business, or

20 other fixed premises—

21 ‘‘(A) to receive signals from other devices lo22 cated at or about such premises regarding a pos23 sible threat at such premises to life, safety, or

24 property, from burglary, fire, vandalism, bodily

25 injury, or other emergency, and
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•S 652 EAH

1 ‘‘(B) to transmit a signal regarding such

2 threat by means of transmission facilities of a

3 Bell operating company or one of its affiliates to

4 a remote monitoring center to alert a person at

5 such center of the need to inform the customer or

6 another person or police, fire, rescue, security, or

7 public safety personnel of such threat,

8 but does not include a service that uses a medical

9 monitoring device attached to an individual for the

10 automatic surveillance of an ongoing medical condi11 tion.

12 ‘‘(2) TELEMESSAGING SERVICES.—The term

13 ‘telemessaging services’ means voice mail and voice

14 storage and retrieval services provided over telephone

15 lines for telemessaging customers and any live opera16 tor services used to answer, record, transcribe, and

17 relay messages (other than telecommunications relay

18 services) from incoming telephone calls on behalf of

19 the telemessaging customers (other than any service

20 incidental to directory assistance).

21 ‘‘SEC. 274. PROVISION OF PAYPHONE SERVICE.

22 ‘‘(a) NONDISCRIMINATION SAFEGUARDS.—After the ef23 fective date of the rules prescribed pursuant to subsection

24 (b), any Bell operating company that provides payphone

25 service—
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1 ‘‘(1) shall not subsidize its payphone service di2 rectly or indirectly with revenue from its telephone

3 exchange service or its exchange access service; and

4 ‘‘(2) shall not prefer or discriminate in favor of

5 it payphone service.

6 ‘‘(b) REGULATIONS.—

7 ‘‘(1) CONTENTS OF REGULATIONS.—In order to

8 promote competition among payphone service provid9 ers and promote the widespread deployment of

10 payphone services to the benefit of the general public,

11 within 9 months after the date of enactment of this

12 section, the Commission shall take all actions nec13 essary (including any reconsideration) to prescribe

14 regulations that—

15 ‘‘(A) establish a per call compensation plan

16 to ensure that all payphone services providers

17 are fairly compensated for each and every com18 pleted intrastate and interstate call using their

19 payphone, except that emergency calls and tele20 communications relay service calls for hearing

21 disabled individuals shall not be subject to such

22 compensation;

23 ‘‘(B) discontinue the intrastate and inter24 state carrier access charge payphone service ele25 ments and payments in effect on the date of en-
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•S 652 EAH

1 actment of this section, and all intrastate and

2 interstate payphone subsidies from basic ex3 change and exchange access revenues, in favor of

4 a compensation plan as specified in subpara5 graph (A);

6 ‘‘(C) prescribe a set of nonstructural safe7 guards for Bell operating company payphone

8 service to implement the provisions of para9 graphs (1) and (2) of subsection (a), which safe10 guards shall, at a minimum, include the non11 structural safeguards equal to those adopted in

12 the Computer Inquiry-III CC Docket No. 90–623

13 proceeding; and

14 ‘‘(D) provide for Bell operating company

15 payphone service providers to have the same

16 right that independent payphone providers have

17 to negotiate with the location provider on select18 ing and contracting with, and, subject to the

19 terms of any agreement with the location pro20 vider, to select and contract with the carriers

21 that carry interLATA calls from their

22 payphones, and provide for all payphone service

23 providers to have the right to negotiate with the

24 location provider on selecting and contracting

25 with, and, subject to the terms of any agreement
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•S 652 EAH

1 with the location provider, to select and contract

2 with the carriers that carry intraLATA calls

3 from their payphones.

4 ‘‘(2) PUBLIC INTEREST TELEPHONES.—In the

5 rulemaking conducted pursuant to paragraph (1), the

6 Commission shall determine whether public interest

7 payphones, which are provided in the interest of pub8 lic health, safety, and welfare, in locations where

9 there would otherwise not be a payphone, should be

10 maintained, and if so, ensure that such public inter11 est payphones are supported fairly and equitably.

12 ‘‘(3) EXISTING CONTRACTS.—Nothing in this sec13 tion shall affect any existing contracts between loca14 tion providers and payphone service providers or

15 interLATA or intraLATA carriers that are in force

16 and effect as of the date of the enactment of this Act.

17 ‘‘(c) STATE PREEMPTION.—To the extent that any

18 State requirements are inconsistent with the Commission’s

19 regulations, the Commission’s regulations on such matters

20 shall preempt State requirements.

21 ‘‘(d) DEFINITION.—As used in this section, the term

22 ‘payphone service’ means the provision of public or semi23 public pay telephones, the provision of inmate telephone

24 service in correctional institutions, and any ancillary serv25 ices.’’.
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1 SEC. 103. FORBEARANCE FROM REGULATION.

2 Part I of title II of the Act (as redesignated by section

3 101(c) of this Act) is amended by inserting after section

4 229 (47 U.S.C. 229) the following new section:

5 ‘‘SEC. 230. FORBEARANCE FROM REGULATION.

6 ‘‘(a) AUTHORITY TO FORBEAR.—The Commission

7 shall forbear from applying any provision of this part or

8 part II (other than sections 201, 202, 208, 243, and 248),

9 or any regulation of the Commission thereunder, to a com10 mon carrier or service, or class of carriers or services, in

11 any or some of its or their geographic markets, unless the

12 Commission determines that—

13 ‘‘(1) enforcement of such provision or regulation

14 is necessary to ensure that the charges, practices, clas15 sifications, or regulations by, for, or in connection

16 with that carrier or service are just and reasonable

17 and are not unjustly or unreasonably discriminatory;

18 ‘‘(2) enforcement of such regulation or provision

19 is not necessary for the protection of consumers; or

20 ‘‘(3) forbearance from applying such provision or

21 regulation is inconsistent with the public interest.

22 ‘‘(b) COMPETITIVE EFFECT TO BE WEIGHED.—In

23 making the determination under subsection (a)(3), the Com24 mission shall consider whether forbearance from enforcing

25 the provision or regulation will promote competitive market

26 conditions, including the extent to which such forbearance
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1 will enhance competition among providers of telecommuni2 cations services. If the Commission determines that such

3 forbearance will promote competition among providers of

4 telecommunications services, that determination may be the

5 basis for a Commission finding that forbearance is in the

6 public interest.

7 ‘‘(c) COMMERCIAL MOBILE SERVICE JOINT MARKET8 ING.—Notwithstanding section 22.903 of the Commission’s

9 regulations (47 C.F.R. 22.903) or any other Commission

10 regulation, or any judicial decree or proposed judicial de11 cree, a Bell operating company or any other company may,

12 except as provided in sections 242(d) and 246 as they relate

13 to wireline service, jointly market and sell commercial mo14 bile services in conjunction with telephone exchange service,

15 exchange access, intraLATA telecommunications service,

16 interLATA telecommunications service, and information

17 services.’’.

18 SEC. 104. ONLINE FAMILY EMPOWERMENT.

19 Title II of the Communications Act of 1934 (47 U.S.C.

20 201 et seq.) is amended by adding at the end the following

21 new section:
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1 ‘‘SEC. 230. PROTECTION FOR PRIVATE BLOCKING AND

2 SCREENING OF OFFENSIVE MATERIAL; FCC

3 REGULATION OF COMPUTER SERVICES PRO4 HIBITED.

5 ‘‘(a) FINDINGS.—The Congress finds the following:

6 ‘‘(1) The rapidly developing array of Internet

7 and other interactive computer services available to

8 individual Americans represent an extraordinary ad9 vance in the availability of educational and informa10 tional resources to our citizens.

11 ‘‘(2) These services offer users a great degree of

12 control over the information that they receive, as well

13 as the potential for even greater control in the future

14 as technology develops.

15 ‘‘(3) The Internet and other interactive computer

16 services offer a forum for a true diversity of political

17 discourse, unique opportunities for cultural develop18 ment, and myriad avenues for intellectual activity.

19 ‘‘(4) The Internet and other interactive computer

20 services have flourished, to the benefit of all Ameri21 cans, with a minimum of government regulation.

22 ‘‘(5) Increasingly Americans are relying on

23 interactive media for a variety of political, edu24 cational, cultural, and entertainment services.

25 ‘‘(b) POLICY.—It is the policy of the United States

26 to—
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1 ‘‘(1) promote the continued development of the

2 Internet and other interactive computer services and

3 other interactive media;

4 ‘‘(2) preserve the vibrant and competitive free

5 market that presently exists for the Internet and other

6 interactive computer services, unfettered by State or

7 Federal regulation;

8 ‘‘(3) encourage the development of technologies

9 which maximize user control over the information re10 ceived by individuals, families, and schools who use

11 the Internet and other interactive computer services;

12 ‘‘(4) remove disincentives for the development

13 and utilization of blocking and filtering technologies

14 that empower parents to restrict their children’s ac15 cess to objectionable or inappropriate online material;

16 and

17 ‘‘(5) ensure vigorous enforcement of criminal

18 laws to deter and punish trafficking in obscenity,

19 stalking, and harassment by means of computer.

20 ‘‘(c) PROTECTION FOR ‘GOOD SAMARITAN’ BLOCKING

21 AND SCREENING OF OFFENSIVE MATERIAL.—No provider

22 or user of interactive computer services shall be treated as

23 the publisher or speaker of any information provided by

24 an information content provider. No provider or user of
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1 interactive computer services shall be held liable on account

2 of—

3 ‘‘(1) any action voluntarily taken in good faith

4 to restrict access to material that the provider or user

5 considers to be obscene, lewd, lascivious, filthy, exces6 sively violent, harassing, or otherwise objectionable,

7 whether or not such material is constitutionally pro8 tected; or

9 ‘‘(2) any action taken to make available to infor10 mation content providers or others the technical

11 means to restrict access to material described in para12 graph (1).

13 ‘‘(d) FCC REGULATION OF THE INTERNET AND OTHER

14 INTERACTIVE COMPUTER SERVICES PROHIBITED.—Noth15 ing in this Act shall be construed to grant any jurisdiction

16 or authority to the Commission with respect to content or

17 any other regulation of the Internet or other interactive

18 computer services.

19 ‘‘(e) EFFECT ON OTHER LAWS.—

20 ‘‘(1) NO EFFECT ON CRIMINAL LAW.—Nothing in

21 this section shall be construed to impair the enforce22 ment of section 223 of this Act, chapter 71 (relating

23 to obscenity) or 110 (relating to sexual exploitation of

24 children) of title 18, United States Code, or any other

25 Federal criminal statute.
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•S 652 EAH

1 ‘‘(2) NO EFFECT ON INTELLECTUAL PROPERTY

2 LAW.—Nothing in this section shall be construed to

3 limit or expand any law pertaining to intellectual

4 property.

5 ‘‘(3) IN GENERAL.—Nothing in this section shall

6 be construed to prevent any State from enforcing any

7 State law that is consistent with this section.

8 ‘‘(f) DEFINITIONS.—As used in this section:

9 ‘‘(1) INTERNET.—The term ‘Internet’ means the

10 international computer network of both Federal and

11 non-Federal interoperable packet switched data net12 works.

13 ‘‘(2) INTERACTIVE COMPUTER SERVICE.—The

14 term ‘interactive computer service’ means any infor15 mation service that provides computer access to mul16 tiple users via modem to a remote computer server,

17 including specifically a service that provides access to

18 the Internet.

19 ‘‘(3) INFORMATION CONTENT PROVIDER.—The

20 term ‘information content provider’ means any per21 son or entity that is responsible, in whole or in part,

22 for the creation or development of information pro23 vided by the Internet or any other interactive com24 puter service, including any person or entity that cre25 ates or develops blocking or screening software or
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1 other techniques to permit user control over offensive

2 material.

3 ‘‘(4) INFORMATION SERVICE.—The term ‘infor4 mation service’ means the offering of a capability for

5 generating, acquiring, storing, transforming, process6 ing, retrieving, utilizing, or making available infor7 mation via telecommunications, and includes elec8 tronic publishing, but does not include any use of any

9 such capability for the management, control, or oper10 ation of a telecommunications system or the manage11 ment of a telecommunications service.’’.

12 SEC. 105. PRIVACY OF CUSTOMER INFORMATION.

13 (a) PRIVACY OF CUSTOMER PROPRIETARY NETWORK

14 INFORMATION.—Title II of the Act is amended by inserting

15 after section 221 (47 U.S.C. 221) the following new section:

16 ‘‘SEC. 222. PRIVACY OF CUSTOMER PROPRIETARY NETWORK

17 INFORMATION.

18 ‘‘(a) SUBSCRIBER LIST INFORMATION.—Notwith19 standing subsections (b), (c), and (d), a carrier that pro20 vides local exchange service shall provide subscriber list in21 formation gathered in its capacity as a provider of such

22 service on a timely and unbundled basis, under nondiscrim23 inatory and reasonable rates, terms, and conditions, to any

24 person upon request for the purpose of publishing direc25 tories in any format.
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1 ‘‘(b) PRIVACY REQUIREMENTS FOR COMMON CAR2 RIERS.—A carrier—

3 ‘‘(1) shall not, except as required by law or with

4 the approval of the customer to which the information

5 relates—

6 ‘‘(A) use customer proprietary network in7 formation in the provision of any service except

8 to the extent necessary (i) in the provision of

9 common carrier services, (ii) in the provision of

10 a service necessary to or used in the provision of

11 common carrier services, including the publish12 ing of directories, or (iii) to continue to provide

13 a particular information service that the carrier

14 provided as of May 1, 1995, to persons who were

15 customers of such service on that date;

16 ‘‘(B) use customer proprietary network in17 formation in the identification or solicitation of

18 potential customers for any service other than

19 the telephone exchange service or telephone toll

20 service from which such information is derived;

21 ‘‘(C) use customer proprietary network in22 formation in the provision of customer premises

23 equipment; or

24 ‘‘(D) disclose customer proprietary network

25 information to any person except to the extent
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1 necessary to permit such person to provide serv2 ices or products that are used in and necessary

3 to the provision by such carrier of the services

4 described in subparagraph (A);

5 ‘‘(2) shall disclose customer proprietary network

6 information, upon affirmative written request by the

7 customer, to any person designated by the customer;

8 ‘‘(3) shall, whenever such carrier provides any

9 aggregate information, notify the Commission of the

10 availability of such aggregate information and shall

11 provide such aggregate information on reasonable

12 terms and conditions to any other service or equip13 ment provider upon reasonable request therefor; and

14 ‘‘(4) except for disclosures permitted by para15 graph (1)(D), shall not unreasonably discriminate be16 tween affiliated and unaffiliated service or equipment

17 providers in providing access to, or in the use and

18 disclosure of, individual and aggregate information

19 made available consistent with this subsection.

20 ‘‘(c) RULE OF CONSTRUCTION.—This section shall not

21 be construed to prohibit the use or disclosure of customer

22 proprietary network information as necessary—

23 ‘‘(1) to render, bill, and collect for the services

24 identified in subsection (b)(1)(A);
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•S 652 EAH

1 ‘‘(2) to render, bill, and collect for any other

2 service that the customer has requested;

3 ‘‘(3) to protect the rights or property of the car4 rier;

5 ‘‘(4) to protect users of any of those services and

6 other carriers from fraudulent, abusive, or unlawful

7 use of or subscription to such service; or

8 ‘‘(5) to provide any inbound telemarketing, refer9 ral, or administrative services to the customer for the

10 duration of the call if such call was initiated by the

11 customer and the customer approves of the use of such

12 information to provide such service.

13 ‘‘(d) EXEMPTION PERMITTED.—The Commission may,

14 by rule, exempt from the requirements of subsection (b) car15 riers that have, together with any affiliated carriers, in the

16 aggregate nationwide, fewer than 500,000 access lines in17 stalled if the Commission determines that such exemption

18 is in the public interest or if compliance with the require19 ments would impose an undue economic burden on the car20 rier.

21 ‘‘(e) DEFINITIONS.—As used in this section:

22 ‘‘(1) CUSTOMER PROPRIETARY NETWORK INFOR23 MATION.—The term ‘customer proprietary network

24 information’ means—
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•S 652 EAH

1 ‘‘(A) information which relates to the quan2 tity, technical configuration, type, destination,

3 and amount of use of telephone exchange service

4 or telephone toll service subscribed to by any cus5 tomer of a carrier, and is made available to the

6 carrier by the customer solely by virtue of the

7 carrier-customer relationship;

8 ‘‘(B) information contained in the bills per9 taining to telephone exchange service or telephone

10 toll service received by a customer of a carrier;

11 and

12 ‘‘(C) such other information concerning the

13 customer as is available to the local exchange

14 carrier by virtue of the customer’s use of the car15 rier’s telephone exchange service or telephone toll

16 services, and specified as within the definition of

17 such term by such rules as the Commission shall

18 prescribe consistent with the public interest;

19 except that such term does not include subscriber list

20 information.

21 ‘‘(2) SUBSCRIBER LIST INFORMATION.—The term

22 ‘subscriber list information’ means any informa23 tion—

24 ‘‘(A) identifying the listed names of sub25 scribers of a carrier and such subscribers’ tele-
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1 phone numbers, addresses, or primary advertis2 ing classifications (as such classifications are as3 signed at the time of the establishment of such

4 service), or any combination of such listed

5 names, numbers, addresses, or classifications;

6 and

7 ‘‘(B) that the carrier or an affiliate has

8 published, caused to be published, or accepted for

9 publication in any directory format.

10 ‘‘(3) AGGREGATE INFORMATION.—The term ‘ag11 gregate information’ means collective data that relates

12 to a group or category of services or customers, from

13 which individual customer identities and characteris14 tics have been removed.’’.

15 (b) CONVERGING COMMUNICATIONS TECHNOLOGIES

16 AND CONSUMER PRIVACY.—

17 (1) COMMISSION EXAMINATION.—Within one

18 year after the date of enactment of this Act, the Com19 mission shall commence a proceeding—

20 (A) to examine the impact of the integra21 tion into interconnected communications net22 works of wireless telephone, cable, satellite, and

23 other technologies on the privacy rights and rem24 edies of the consumers of those technologies;
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1 (B) to examine the impact that the

2 globalization of such integrated communications

3 networks has on the international dissemination

4 of consumer information and the privacy rights

5 and remedies to protect consumers;

6 (C) to propose changes in the Commission’s

7 regulations to ensure that the effect on consumer

8 privacy rights is considered in the introduction

9 of new telecommunications services and that the

10 protection of such privacy rights is incorporated

11 as necessary in the design of such services or the

12 rules regulating such services;

13 (D) to propose changes in the Commission’s

14 regulations as necessary to correct any defects

15 identified pursuant to subparagraph (A) in such

16 rights and remedies; and

17 (E) to prepare recommendations to the Con18 gress for any legislative changes required to cor19 rect such defects.

20 (2) SUBJECTS FOR EXAMINATION.—In conduct21 ing the examination required by paragraph (1), the

22 Commission shall determine whether consumers are

23 able, and, if not, the methods by which consumers

24 may be enabled—
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1 (A) to have knowledge that consumer infor2 mation is being collected about them through

3 their utilization of various communications tech4 nologies;

5 (B) to have notice that such information

6 could be used, or is intended to be used, by the

7 entity collecting the data for reasons unrelated to

8 the original communications, or that such infor9 mation could be sold (or is intended to be sold)

10 to other companies or entities; and

11 (C) to stop the reuse or sale of that informa12 tion.

13 (3) SCHEDULE FOR COMMISSION RESPONSES.—

14 The Commission shall, within 18 months after the

15 date of enactment of this Act—

16 (A) complete any rulemaking required to re17 vise Commission regulations to correct defects in

18 such regulations identified pursuant to para19 graph (1); and

20 (B) submit to the Congress a report con21 taining the recommendations required by para22 graph (1)(C).

23 SEC. 106. POLE ATTACHMENTS.

24 Section 224 of the Act (47 U.S.C. 224) is amended—

25 (1) in subsection (a)(4)—
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1 (A) by inserting after ‘‘system’’ the follow2 ing: ‘‘or a provider of telecommunications serv3 ice’’; and

4 (B) by inserting after ‘‘utility’’ the follow5 ing: ‘‘, which attachment may be used by such

6 entities to provide cable service or any tele7 communications service’’;

8 (2) in subsection (c)(2)(B), by striking ‘‘cable tel9 evision services’’ and inserting ‘‘the services offered

10 via such attachments’’;

11 (3) by redesignating subsection (d)(2) as sub12 section (d)(4); and

13 (4) by striking subsection (d)(1) and inserting

14 the following:

15 ‘‘(d)(1) For purposes of subsection (b) of this section,

16 the Commission shall, no later than 1 year after the date

17 of enactment of the Communications Act of 1995, prescribe

18 regulations for ensuring that, when the parties fail to nego19 tiate a mutually agreeable rate, utilities charge just and

20 reasonable and nondiscriminatory rates for pole attach21 ments provided to all providers of telecommunications serv22 ices, including such attachments used by cable television

23 systems to provide telecommunications services (as defined

24 in section 3 of this Act). Such regulations shall—
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1 ‘‘(A) recognize that the entire pole, duct, conduit,

2 or right-of-way other than the usable space is of equal

3 benefit to all entities attaching to the pole and there4 fore apportion the cost of the space other than the us5 able space equally among all such attaching entities;

6 ‘‘(B) recognize that the usable space is of propor7 tional benefit to all entities attaching to the pole,

8 duct, conduit or right-of-way and therefore apportion

9 the cost of the usable space according to the percent10 age of usable space required for each entity;

11 ‘‘(C) recognize that the pole, duct, conduit, or

12 right-of-way has a value that exceeds costs and that

13 value shall be reflected in any rate; and

14 ‘‘(D) allow for reasonable terms and conditions

15 relating to health, safety, and the provision of reliable

16 utility service.

17 ‘‘(2) The final regulations prescribed by the Commis18 sion pursuant to paragraph (1) shall not apply to a cable

19 television system that solely provides cable service as defined

20 in section 602(6) of this Act; instead, the pole attachment

21 rate for such systems shall assure a utility the recovery of

22 not less than the additional costs of providing pole attach23 ments, nor more than an amount determined by multiply24 ing the percentage of the total usable space, or the percent25 age of the total duct or conduit capacity, which is occupied
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1 by the pole attachment by the sum of the operating expenses

2 and actual capital costs of the utility attributable to the

3 entire pole, duct, conduit, or right-of-way.

4 ‘‘(3) Whenever the owner of a conduit or right-of-way

5 intends to modify or alter such conduit or right-of-way, the

6 owner shall provide written notification of such action to

7 any entity that has obtained an attachment to such conduit

8 or right-of-way so that such entity may have a reasonable

9 opportunity to add to or modify its existing attachment.

10 Any entity that adds to or modifies its existing attachment

11 after receiving such notification shall bear a proportionate

12 share of the costs incurred by the owner in making such

13 conduit or right-of-way accessible.’’.

14 SEC. 107. PREEMPTION OF FRANCHISING AUTHORITY REG15 ULATION OF TELECOMMUNICATIONS SERV16 ICES.

17 (a) TELECOMMUNICATIONS SERVICES.—Section 621(b)

18 of the Act (47 U.S.C. 541(c)) is amended by adding at the

19 end thereof the following new paragraph:

20 ‘‘(3)(A) To the extent that a cable operator or affiliate

21 thereof is engaged in the provision of telecommunications

22 services—

23 ‘‘(i) such cable operator or affiliate shall not be

24 required to obtain a franchise under this title; and
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1 ‘‘(ii) the provisions of this title shall not apply

2 to such cable operator or affiliate.

3 ‘‘(B) A franchising authority may not impose any re4 quirement that has the purpose or effect of prohibiting, lim5 iting, restricting, or conditioning the provision of a tele6 communications service by a cable operator or an affiliate

7 thereof.

8 ‘‘(C) A franchising authority may not order a cable

9 operator or affiliate thereof—

10 ‘‘(i) to discontinue the provision of a tele11 communications service, or

12 ‘‘(ii) to discontinue the operation of a cable sys13 tem, to the extent such cable system is used for the

14 provision of a telecommunications service, by reason

15 of the failure of such cable operator or affiliate thereof

16 to obtain a franchise or franchise renewal under this

17 title with respect to the provision of such tele18 communications service.

19 ‘‘(D) Except as otherwise permitted by sections 611

20 and 612, a franchising authority may not require a cable

21 operator to provide any telecommunications service or fa22 cilities, other than intragovernmental telecommunications

23 services, as a condition of the initial grant of a franchise

24 or a franchise renewal.’’.
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1 (b) FRANCHISE FEES.—Section 622(b) of the Act (47

2 U.S.C. 542(b)) is amended by inserting ‘‘to provide cable

3 services’’ immediately before the period at the end of the

4 first sentence thereof.

5 SEC. 108. FACILITIES SITING; RADIO FREQUENCY EMISSION

6 STANDARDS.

7 (a) NATIONAL WIRELESS TELECOMMUNICATIONS

8 SITING POLICY.—Section 332(c) of the Act (47 U.S.C.

9 332(c)) is amended by adding at the end the following new

10 paragraph:

11 ‘‘(7) FACILITIES SITING POLICIES.—(A) Within

12 180 days after enactment of this paragraph, the Com13 mission shall prescribe and make effective a policy to

14 reconcile State and local regulation of the siting of fa15 cilities for the provision of commercial mobile services

16 or unlicensed services with the public interest in fos17 tering competition through the rapid, efficient, and

18 nationwide deployment of commercial mobile services

19 or unlicensed services.

20 ‘‘(B) Pursuant to subchapter III of chapter 5,

21 title 5, United States Code, the Commission shall es22 tablish a negotiated rulemaking committee to nego23 tiate and develop a proposed policy to comply with

24 the requirements of this paragraph. Such committee

25 shall include representatives from State and local gov-
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1 ernments, affected industries, and public safety agen2 cies.

3 ‘‘(C) The policy prescribed pursuant to this sub4 paragraph shall take into account—

5 ‘‘(i) the need to enhance the coverage and

6 quality of commercial mobile services and unli7 censed services and foster competition in the pro8 vision of commercial mobile services and unli9 censed services on a timely basis;

10 ‘‘(ii) the legitimate interests of State and

11 local governments in matters of exclusively local

12 concern, and the need to provide State and local

13 government with maximum flexibility to address

14 such local concerns, while ensuring that such in15 terests do not prohibit or have the effect of pre16 cluding any commercial mobile service or unli17 censed service;

18 ‘‘(iii) the effect of State and local regulation

19 of facilities siting on interstate commerce;

20 ‘‘(iv) the administrative costs to State and

21 local governments of reviewing requests for au22 thorization to locate facilities for the provision of

23 commercial mobile services or unlicensed serv24 ices; and
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1 ‘‘(v) the need to provide due process in mak2 ing any decision by a State or local government

3 or instrumentality thereof to grant or deny a re4 quest for authorization to locate, construct, mod5 ify, or operate facilities for the provision of com6 mercial mobile services or unlicensed services.

7 ‘‘(D) The policy prescribed pursuant to this

8 paragraph shall provide that no State or local govern9 ment or any instrumentality thereof may regulate the

10 placement, construction, modification, or operation of

11 such facilities on the basis of the environmental effects

12 of radio frequency emissions, to the extent that such

13 facilities comply with the Commission’s regulations

14 concerning such emissions.

15 ‘‘(E) The proceeding to prescribe such policy

16 pursuant to this paragraph shall supercede any pro17 ceeding pending on the date of enactment of this

18 paragraph relating to preemption of State and local

19 regulation of tower siting for commercial mobile serv20 ices, unlicensed services, and providers thereof. In ac21 cordance with subchapter III of chapter 5, title 5,

22 United States Code, the Commission shall periodi23 cally establish a negotiated rulemaking committee to

24 review the policy prescribed by the Commission under
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1 this paragraph and to recommend revisions to such

2 policy.

3 ‘‘(F) For purposes of this paragraph, the term

4 ‘unlicensed service’ means the offering of tele5 communications using duly authorized devices which

6 do not require individual licenses.’’.

7 (b) RADIO FREQUENCY EMISSIONS.—Within 180 days

8 after the enactment of this Act, the Commission shall com9 plete action in ET Docket 93–62 to prescribe and make ef10 fective rules regarding the environmental effects of radio fre11 quency emissions.

12 (c) AVAILABILITY OF PROPERTY.—Within 180 days of

13 the enactment of this Act, the Commission shall prescribe

14 procedures by which Federal departments and agencies may

15 make available on a fair, reasonable, and nondiscrim16 inatory basis, property, rights-of-way, and easements under

17 their control for the placement of new telecommunications

18 facilities by duly licensed providers of telecommunications

19 services that are dependent, in whole or in part, upon the

20 utilization of Federal spectrum rights for the transmission

21 or reception of such services. These procedures may establish

22 a presumption that requests for the use of property, rights23 of-way, and easements by duly authorized providers should

24 be granted absent unavoidable direct conflict with the de25 partment or agency’s mission, or the current or planned
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1 use of the property, rights-of-way, and easements in ques2 tion. Reasonable fees may be charged to providers of such

3 telecommunications services for use of property, rights-of4 way, and easements. The Commission shall provide tech5 nical support to States to encourage them to make property,

6 rights-of-way, and easements under their jurisdiction avail7 able for such purposes.

8 SEC. 109. MOBILE SERVICE ACCESS TO LONG DISTANCE

9 CARRIERS.

10 (a) AMENDMENT.—Section 332(c) of the Act (47

11 U.S.C. 332(c)) is amended by adding at the end the follow12 ing new paragraph:

13 ‘‘(8) MOBILE SERVICES ACCESS.—(A) The Com14 mission shall prescribe regulations to afford subscrib15 ers of two-way switched voice commercial mobile

16 radio services access to a provider of telephone toll

17 service of the subscriber’s choice, except to the extent

18 that the commercial mobile radio service is provided

19 by satellite. The Commission may exempt carriers or

20 classes of carriers from the requirements of such regu21 lations to the extent the Commission determines such

22 exemption is consistent with the public interest, con23 venience, and necessity. For purposes of this para24 graph, ‘access’ shall mean access to a provider of tele-
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1 phone toll service through the use of carrier identifica2 tion codes assigned to each such provider.

3 ‘‘(B) The regulations prescribed by the Commis4 sion pursuant to subparagraph (A) shall supersede

5 any inconsistent requirements imposed by the Modi6 fication of Final Judgment or any order in United

7 States v. AT&T Corp. and McCaw Cellular Commu8 nications, Inc., Civil Action No. 94–01555 (United

9 States District Court, District of Columbia).’’.

10 (b) EFFECTIVE DATE CONFORMING AMENDMENT.—

11 Section 6002(c)(2)(B) of the Omnibus Budget Reconcili12 ation Act of 1993 is amended by striking ‘‘section

13 332(c)(6)’’ and inserting ‘‘paragraphs (6) and (8) of section

14 332(c)’’.

15 SEC. 110. FREEDOM FROM TOLL FRAUD.

16 (a) AMENDMENT.—Section 228(c) of the Act (47

17 U.S.C. 228(c)) is amended—

18 (1) by striking subparagraph (C) of paragraph

19 (7) and inserting the following:

20 ‘‘(C) the calling party being charged for in21 formation conveyed during the call unless—

22 ‘‘(i) the calling party has a written

23 subscription agreement with the informa24 tion provider that meets the requirements of

25 paragraph (8); or
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1 ‘‘(ii) the calling party is charged in

2 accordance with paragraph (9); or’’; and

3 (2) by adding at the end the following new para4 graphs:

5 ‘‘(8) SUBSCRIPTION AGREEMENTS FOR BILLING

6 FOR INFORMATION PROVIDED VIA TOLL-FREE

7 CALLS.—

8 ‘‘(A) IN GENERAL.—For purposes of para9 graph (7)(C)(i), a written subscription agree10 ment shall specify the terms and conditions

11 under which the information is offered and in12 clude—

13 ‘‘(i) the rate at which charges are as14 sessed for the information;

15 ‘‘(ii) the information provider’s name;

16 ‘‘(iii) the information provider’s busi17 ness address;

18 ‘‘(iv) the information provider’s regu19 lar business telephone number;

20 ‘‘(v) the information provider’s agree21 ment to notify the subscriber at least 30

22 days in advance of all future changes in the

23 rates charged for the information;
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1 ‘‘(vi) the signature of a legally com2 petent subscriber agreeing to the terms of

3 the agreement; and

4 ‘‘(vii) the subscriber’s choice of pay5 ment method, which may be by phone bill

6 or credit, prepaid, or calling card.

7 ‘‘(B) BILLING ARRANGEMENTS.—If a sub8 scriber elects, pursuant to subparagraph (A)(vii),

9 to pay by means of a phone bill—

10 ‘‘(i) the agreement shall clearly explain

11 that the subscriber will be assessed for calls

12 made to the information service from the

13 subscriber’s phone line;

14 ‘‘(ii) the phone bill shall include, in

15 prominent type, the following disclaimer:

16 ‘Common carriers may not dis17 connect local or long distance telephone

18 service for failure to pay disputed

19 charges for information services.’; and

20 ‘‘(iii) the phone bill shall clearly list

21 the 800 number dialed.

22 ‘‘(C) USE OF PIN’S TO PREVENT UNAUTHOR23 IZED USE.—A written agreement does not meet

24 the requirements of this paragraph unless it pro25 vides the subscriber a personal identification
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1 number to obtain access to the information pro2 vided, and includes instructions on its use.

3 ‘‘(D) EXCEPTIONS.—Notwithstanding para4 graph (7)(C), a written agreement that meets the

5 requirements of this paragraph is not required—

6 ‘‘(i) for services provided pursuant to a

7 tariff that has been approved or permitted

8 to take effect by the Commission or a State

9 commission; or

10 ‘‘(ii) for any purchase of goods or of

11 services that are not information services.

12 ‘‘(E) TERMINATION OF SERVICE.—On com13 plaint by any person, a carrier may terminate

14 the provision of service to an information pro15 vider unless the provider supplies evidence of a

16 written agreement that meets the requirements of

17 this section. The remedies provided in this para18 graph are in addition to any other remedies that

19 are available under title V of this Act.

20 ‘‘(9) CHARGES BY CREDIT, PREPAID, OR CALLING

21 CARD IN ABSENCE OF AGREEMENT.—For purposes of

22 paragraph (7)(C)(ii), a calling party is not charged

23 in accordance with this paragraph unless the calling

24 party is charged by means of a credit, prepaid, or

25 calling card and the information service provider in-
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1 cludes in response to each call an introductory disclo2 sure message that—

3 ‘‘(A) clearly states that there is a charge for

4 the call;

5 ‘‘(B) clearly states the service’s total cost

6 per minute and any other fees for the service or

7 for any service to which the caller may be trans8 ferred;

9 ‘‘(C) explains that the charges must be

10 billed on either a credit, prepaid, or calling card;

11 ‘‘(D) asks the caller for the credit or calling

12 card number;

13 ‘‘(E) clearly states that charges for the call

14 begin at the end of the introductory message; and

15 ‘‘(F) clearly states that the caller can hang

16 up at or before the end of the introductory mes17 sage without incurring any charge whatsoever.

18 ‘‘(10) DEFINITION OF CALLING CARD.—As used

19 in this subsection, the term ‘calling card’ means an

20 identifying number or code unique to the individual,

21 that is issued to the individual by a common carrier

22 and enables the individual to be charged by means of

23 a phone bill for charges incurred independent of

24 where the call originates.’’.
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1 (b) REGULATIONS.—The Federal Communications

2 Commission shall revise its regulations to comply with the

3 amendment made by subsection (a) of this section within

4 180 days after the date of enactment of this Act.

5 SEC. 111. REPORT ON MEANS OF RESTRICTING ACCESS TO

6 UNWANTED MATERIAL IN INTERACTIVE TELE7 COMMUNICATIONS SYSTEMS.

8 (a) REPORT.—Not later than 150 days after the date

9 of the enactment of this Act, the Attorney General shall sub10 mit to the Committees on the Judiciary and Commerce,

11 Science, and Transportation of the Senate and the Commit12 tees on the Judiciary and Commerce of the House of Rep13 resentatives a report containing—

14 (1) an evaluation of the enforceability with re15 spect to interactive media of current criminal laws

16 governing the distribution of obscenity over computer

17 networks and the creation and distribution of child

18 pornography by means of computers;

19 (2) an assessment of the Federal, State, and local

20 law enforcement resources that are currently available

21 to enforce such laws;

22 (3) an evaluation of the technical means avail23 able—

24 (A) to enable parents to exercise control over

25 the information that their children receive by
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1 interactive telecommunications systems so that

2 children may avoid violent, sexually explicit,

3 harassing, offensive, and other unwanted mate4 rial on such systems;

5 (B) to enable other users of such systems to

6 exercise control over the commercial and non7 commercial information that they receive by such

8 systems so that such users may avoid violent,

9 sexually explicit, harassing, offensive, and other

10 unwanted material on such systems; and

11 (C) to promote the free flow of information,

12 consistent with the values expressed in the Con13 stitution, in interactive media; and

14 (4) recommendations on means of encouraging

15 the development and deployment of technology, in16 cluding computer hardware and software, to enable

17 parents and other users of interactive telecommuni18 cations systems to exercise the control described in

19 subparagraphs (A) and (B) of paragraph (3).

20 (b) CONSULTATION.—In preparing the report under

21 subsection (a), the Attorney General shall consult with the

22 Assistant Secretary of Commerce for Communications and

23 Information.
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1 SEC. 112. TELECOMMUNICATIONS DEVELOPMENT FUND.

2 (a) DEPOSIT AND USE OF AUCTION ESCROW AC3 COUNTS.—Section 309(j)(8) of the Act (47 U.S.C. 309(j)(8))

4 is amended by adding at the end the following new subpara5 graph:

6 ‘‘(C) DEPOSIT AND USE OF AUCTION ES7 CROW ACCOUNTS.—Any deposits the Commission

8 may require for the qualification of any person

9 to bid in a system of competitive bidding pursu10 ant to this subsection shall be deposited in an in11 terest bearing account at a financial institution

12 designated for purposes of this subsection by the

13 Commission (after consultation with the Sec14 retary of the Treasury). Within 45 days follow15 ing the conclusion of the competitive bidding—

16 ‘‘(i) the deposits of successful bidders

17 shall be paid to the Treasury;

18 ‘‘(ii) the deposits of unsuccessful bid19 ders shall be returned to such bidders; and

20 ‘‘(iii) the interest accrued to the ac21 count shall be transferred to the Tele22 communications Development Fund estab23 lished pursuant to section 10 of this Act.’’.

24 (b) ESTABLISHMENT AND OPERATION OF FUND.—

25 Title I of the Act is amended by adding at the end the fol26 lowing new section:
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1 ‘‘SEC. 10. TELECOMMUNICATIONS DEVELOPMENT FUND.

2 ‘‘(a) PURPOSE OF SECTION.—It is the purpose of this

3 section—

4 ‘‘(1) to promote access to capital for small busi5 nesses in order to enhance competition in the tele6 communications industry;

7 ‘‘(2) to stimulate new technology development,

8 and promote employment and training; and

9 ‘‘(3) to support universal service and promote

10 delivery of telecommunications services to underserved

11 rural and urban areas.

12 ‘‘(b) ESTABLISHMENT OF FUND.—There is hereby es13 tablished a body corporate to be known as the Telecommuni14 cations Development Fund, which shall have succession

15 until dissolved. The Fund shall maintain its principal of16 fice in the District of Columbia and shall be deemed, for

17 purposes of venue and jurisdiction in civil actions, to be

18 a resident and citizen thereof.

19 ‘‘(c) BOARD OF DIRECTORS.—

20 ‘‘(1) COMPOSITION OF BOARD; CHAIRMAN.—The

21 Fund shall have a Board of Directors which shall con22 sist of 7 persons appointed by the Chairman of the

23 Commission. Four of such directors shall be represent24 ative of the private sector and three of such directors

25 shall be representative of the Commission, the Small

26 Business Administration, and the Department of the
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1 Treasury, respectively. The Chairman of the Commis2 sion shall appoint one of the representatives of the

3 private sector to serve as chairman of the Fund with4 in 30 days after the date of enactment of this section,

5 in order to facilitate rapid creation and implementa6 tion of the Fund. The directors shall include members

7 with experience in a number of the following areas:

8 finance, investment banking, government banking,

9 communications law and administrative practice,

10 and public policy.

11 ‘‘(2) TERMS OF APPOINTED AND ELECTED MEM12 BERS.—The directors shall be eligible to serve for

13 terms of 5 years, except of the initial members, as des14 ignated at the time of their appointment—

15 ‘‘(A) 1 shall be eligible to service for a term

16 of 1 year;

17 ‘‘(B) 1 shall be eligible to service for a term

18 of 2 years;

19 ‘‘(C) 1 shall be eligible to service for a term

20 of 3 years;

21 ‘‘(D) 2 shall be eligible to service for a term

22 of 4 years; and

23 ‘‘(E) 2 shall be eligible to service for a term

24 of 5 years (1 of whom shall be the Chairman).
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1 Directors may continue to serve until their successors

2 have been appointed and have qualified.

3 ‘‘(3) MEETINGS AND FUNCTIONS OF THE

4 BOARD.—The Board of Directors shall meet at the call

5 of its Chairman, but at least quarterly. The Board

6 shall determine the general policies which shall govern

7 the operations of the Fund. The Chairman of the

8 Board shall, with the approval of the Board, select,

9 appoint, and compensate qualified persons to fill the

10 offices as may be provided for in the bylaws, with

11 such functions, powers, and duties as may be pre12 scribed by the bylaws or by the Board of Directors,

13 and such persons shall be the officers of the Fund and

14 shall discharge all such functions, powers, and duties.

15 ‘‘(d) ACCOUNTS OF THE FUND.—The Fund shall

16 maintain its accounts at a financial institution designated

17 for purposes of this section by the Chairman of the Board

18 (after consultation with the Commission and the Secretary

19 of the Treasury). The accounts of the Fund shall consist

20 of—

21 ‘‘(1) interest transferred pursuant to section

22 309(j)(8)(C) of this Act;

23 ‘‘(2) such sums as may be appropriated to the

24 Commission for advances to the Fund;
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1 ‘‘(3) any contributions or donations to the Fund

2 that are accepted by the Fund; and

3 ‘‘(4) any repayment of, or other payment made

4 with respect to, loans, equity, or other extensions of

5 credit made from the Fund.

6 ‘‘(e) USE OF THE FUND.—All moneys deposited into

7 the accounts of the Fund shall be used solely for—

8 ‘‘(1) the making of loans, investments, or other

9 extensions of credits to eligible small businesses in ac10 cordance with subsection (f);

11 ‘‘(2) the provision of financial advise to eligible

12 small businesses;

13 ‘‘(3) expenses for the administration and man14 agement of the Fund;

15 ‘‘(4) preparation of research, studies, or finan16 cial analyses; and

17 ‘‘(5) other services consistent with the purposes of

18 this section.

19 ‘‘(f) LENDING AND CREDIT OPERATIONS.—Loans or

20 other extensions of credit from the Fund shall be made

21 available to eligible small business on the basis of—

22 ‘‘(1) the analysis of the business plan of the eligi23 ble small business;

24 ‘‘(2) the reasonable availability of collateral to

25 secure the loan or credit extension;
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1 ‘‘(3) the extent to which the loan or credit exten2 sion promotes the purposes of this section; and

3 ‘‘(4) other lending policies as defined by the

4 Board.

5 ‘‘(g) RETURN OF ADVANCES.—Any advances appro6 priated pursuant to subsection (b)(2) shall be upon such

7 terms and conditions (including conditions relating to the

8 time or times of repayment) as the Board determines will

9 best carry out the purposes of this section, in light of the

10 maturity and solvency of the Fund.

11 ‘‘(h) GENERAL CORPORATE POWERS.—The Fund shall

12 have power—

13 ‘‘(1) to sue and be sued, complain and defend, in

14 its corporate name and through its own counsel;

15 ‘‘(2) to adopt, alter, and use the corporate seal,

16 which shall be judicially noticed;

17 ‘‘(3) to adopt, amend, and repeal by its Board

18 of Directors, bylaws, rules, and regulations as may be

19 necessary for the conduct of its business;

20 ‘‘(4) to conduct its business, carry on its oper21 ations, and have officers and exercise the power

22 granted by this section in any State without regard

23 to any qualification or similar statute in any State;

24 ‘‘(5) to lease, purchase, or otherwise acquire,

25 own, hold, improve, use, or otherwise deal in and
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1 with any property, real, personal, or mixed, or any

2 interest therein, wherever situated;

3 ‘‘(6) to accept gifts or donations of services, or of

4 property, real, personal, or mixed, tangible or intan5 gible, in aid of any of the purposes of the Fund;

6 ‘‘(7) to sell, convey, mortgage, pledge, lease, ex7 change, and otherwise dispose of its property and as8 sets;

9 ‘‘(8) to appoint such officers, attorneys, employ10 ees, and agents as may be required, to determine their

11 qualifications, to define their duties, to fix their sala12 ries, require bonds for them, and fix the penalty there13 of; and

14 ‘‘(9) to enter into contracts, to execute instru15 ments, to incur liabilities, to make loans and equity

16 investment, and to do all things as are necessary or

17 incidental to the proper management of its affairs

18 and the proper conduct of its business.

19 ‘‘(i) ACCOUNTING, AUDITING, AND REPORTING.—The

20 accounts of the Fund shall be audited annually. Such audits

21 shall be conducted in accordance with generally accepted

22 auditing standards by independent certified public account23 ants. A report of each such audit shall be furnished to the

24 Secretary of the Treasury and the Commission. The rep25 resentatives of the Secretary and the Commission shall have
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1 access to all books, accounts, financial records, reports, files,

2 and all other papers, things, or property belonging to or

3 in use by the Fund and necessary to facilitate the audit.

4 ‘‘(j) REPORT ON AUDITS BY TREASURY.—A report of

5 each such audit for a fiscal year shall be made by the Sec6 retary of the Treasury to the President and to the Congress

7 not later than 6 months following the close of such fiscal

8 year. The report shall set forth the scope of the audit and

9 shall include a statement of assets and liabilities, capital

10 and surplus or deficit; a statement of surplus or deficit

11 analysis; a statement of income and expense; a statement

12 of sources and application of funds; and such comments and

13 information as may be deemed necessary to keep the Presi14 dent and the Congress informed of the operations and finan15 cial condition of the Fund, together with such recommenda16 tions with respect thereto as the Secretary may deem advis17 able.

18 ‘‘(k) DEFINITIONS.—As used in this section:

19 ‘‘(1) ELIGIBLE SMALL BUSINESS.—The term ‘eli20 gible small business’ means business enterprises en21 gaged in the telecommunications industry that have

22 $50,000,000 or less in annual revenues, on average

23 over the past 3 years prior to submitting the applica24 tion under this section.
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1 ‘‘(2) FUND.—The term ‘Fund’ means the Tele2 communications Development Fund established pur3 suant to this section.

4 ‘‘(3) TELECOMMUNICATIONS INDUSTRY.—The

5 term ‘telecommunications industry’ means commu6 nications businesses using regulated or unregulated

7 facilities or services and includes the broadcasting, te8 lephony, cable, computer, data transmission, software,

9 programming, advanced messaging, and electronics

10 businesses.’’.

11 SEC. 113. REPORT ON THE USE OF ADVANCED TELE12 COMMUNICATIONS SERVICES FOR MEDICAL

13 PURPOSES.

14 The Assistant Secretary of Commerce for Communica15 tions and Information, in consultation with the Secretary

16 of Health and Human Services and other appropriate de17 partments and agencies, shall submit a report to the Com18 mittee on Commerce of the House of Representatives and

19 the Committee on Commerce, Science and Transportation

20 of the Senate concerning the activities of the Joint Working

21 Group on Telemedicine, together with any findings reached

22 in the studies and demonstrations on telemedicine funded

23 by the Public Health Service or other Federal agencies. The

24 report shall examine questions related to patient safety, the

25 efficacy and quality of the services provided, and other
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1 legal, medical, and economic issues related to the utilization

2 of advanced telecommunications services for medical pur3 poses. The report shall be submitted to the respective Com4 mittees annually, by January 31, beginning in 1996.

5 SEC. 114. TELECOMMUTING PUBLIC INFORMATION PRO6 GRAM.

7 (a) TELECOMMUTING RESEARCH PROGRAMS AND PUB8 LIC INFORMATION DISSEMINATION.—The Assistant Sec9 retary of Commerce for Communications and Information,

10 in consultation with the Secretary of Transportation, the

11 Secretary of Labor, and the Administrator of the Environ12 mental Protection Agency, shall, within three months of the

13 date of enactment of this Act, carry out research to identify

14 successful telecommuting programs in the public and pri15 vate sectors and provide for the dissemination to the public

16 of information regarding—

17 (1) the establishment of successful telecommuting

18 programs; and

19 (2) the benefits and costs of telecommuting.

20 (b) REPORT.—Within one year of the date of enact21 ment of this Act, the Assistant Secretary of Commerce for

22 Communications and Information shall report to Congress

23 the findings, conclusions, and recommendations regarding

24 telecommuting developed under this section.
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1 SEC. 115. AUTHORIZATION OF APPROPRIATIONS.

2 (a) IN GENERAL.—In addition to any other sums au3 thorized by law, there are authorized to be appropriated to

4 the Federal Communications Commission such sums as

5 may be necessary to carry out this Act and the amendments

6 made by this Act.

7 (b) EFFECT ON FEES.—For the purposes of section

8 9(b)(2) of the Act (47 U.S.C. 159(b)(2)), additional

9 amounts appropriated pursuant to subsection (a) shall be

10 construed to be changes in the amounts appropriated for

11 the performance of activities described in section 9(a) of

12 such Act.

13 TITLE II—CABLE COMMUNICA14 TIONS COMPETITIVENESS

15 SEC. 201. CABLE SERVICE PROVIDED BY TELEPHONE COM16 PANIES.

17 (a) GENERAL REQUIREMENT.—

18 (1) AMENDMENT.—Section 613(b) of the Act (47

19 U.S.C. 533(b)) is amended to read as follows:

20 ‘‘(b)(1) Subject to the requirements of part V and the

21 other provisions of this title, any common carrier subject

22 in whole or in part to title II of this Act may, either

23 through its own facilities or through an affiliate, provide

24 video programming directly to subscribers in its telephone

25 service area.
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1 ‘‘(2) Subject to the requirements of part V and the

2 other provisions of this title, any common carrier subject

3 in whole or in part to title II of this Act may provide chan4 nels of communications or pole, line, or conduit space, or

5 other rental arrangements, to any entity which is directly

6 or indirectly owned, operated, or controlled by, or under

7 common control with, such common carrier, if such facili8 ties or arrangements are to be used for, or in connection

9 with, the provision of video programming directly to sub10 scribers in its telephone service area.

11 ‘‘(3)(A) Notwithstanding paragraphs (1) and (2), an

12 affiliate described in subparagraph (B) shall not be subject

13 to the requirements of part V (other than section 652),

14 but—

15 ‘‘(i) if providing video programming as a cable

16 service using a cable system, shall be subject to the re17 quirements of this part and parts III and IV; and

18 ‘‘(ii) if providing such video programming by

19 means of radio communication, shall be subject to the

20 requirements of title III.

21 ‘‘(B) For purposes of subparagraph (A), an affiliate

22 is described in this subparagraph if such affiliate—

23 ‘‘(i) is, consistently with section 655, owned, op24 erated, or controlled by, or under common control
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1 with, a common carrier subject in whole or in part

2 to title II of this Act;

3 ‘‘(ii) provides video programming to subscribers

4 in the telephone service area of such carrier; and

5 ‘‘(iii) has not established a video platform in ac6 cordance with section 653.’’.

7 (2) CONFORMING AMENDMENT.—Section 602 of

8 the Act (47 U.S.C. 531) is amended—

9 (A) by redesignating paragraphs (18) and

10 (19) as paragraphs (19) and (20) respectively;

11 and

12 (B) by inserting after paragraph (17) the

13 following new paragraph:

14 ‘‘(18) the term ‘telephone service area’ when used

15 in connection with a common carrier subject in whole

16 or in part to title II of this Act means the area with17 in which such carrier provides telephone exchange

18 service as of January 1, 1993, but if any common

19 carrier after such date transfers its exchange service

20 facilities to another common carrier, the area to

21 which such facilities provide telephone exchange serv22 ice shall be treated as part of the telephone service

23 area of the acquiring common carrier and not of the

24 selling common carrier;’’.
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1 (b) PROVISIONS FOR REGULATION OF CABLE SERVICE

2 PROVIDED BY TELEPHONE COMPANIES.—Title VI of the

3 Act (47 U.S.C. 521 et seq.) is amended by adding at the

4 end the following new part:

5 ‘‘PART V—VIDEO PROGRAMMING SERVICES

6 PROVIDED BY TELEPHONE COMPANIES

7 ‘‘SEC. 651. DEFINITIONS.

8 ‘‘For purposes of this part—

9 ‘‘(1) the term ‘control’ means—

10 ‘‘(A) an ownership interest in which an en11 tity has the right to vote more than 50 percent

12 of the outstanding common stock or other owner13 ship interest; or

14 ‘‘(B) if no single entity directly or indi15 rectly has the right to vote more than 50 percent

16 of the outstanding common stock or other owner17 ship interest, actual working control, in whatever

18 manner exercised, as defined by the Commission

19 by regulation on the basis of relevant factors and

20 circumstances, which shall include partnership

21 and direct ownership interests, voting stock in22 terests, the interests of officers and directors, and

23 the aggregation of voting interests; and

24 ‘‘(2) the term ‘rural area’ means a geographic

25 area that does not include either—
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•S 652 EAH

1 ‘‘(A) any incorporated or unincorporated

2 place of 10,000 inhabitants or more, or any part

3 thereof; or

4 ‘‘(B) any territory, incorporated or unin5 corporated, included in an urbanized area, as

6 defined by the Bureau of the Census.

7 ‘‘SEC. 652. SEPARATE VIDEO PROGRAMMING AFFILIATE.

8 ‘‘(a) IN GENERAL.—Except as provided in subsection

9 (d) of this section and section 613(b)(3), a common carrier

10 subject to title II of this Act shall not provide video pro11 gramming directly to subscribers in its telephone service

12 area unless such video programming is provided through

13 a video programming affiliate that is separate from such

14 carrier.

15 ‘‘(b) BOOKS AND MARKETING.—

16 ‘‘(1) IN GENERAL.—A video programming affili17 ate of a common carrier shall—

18 ‘‘(A) maintain books, records, and accounts

19 separate from such carrier which identify all

20 transactions with such carrier;

21 ‘‘(B) carry out directly (or through any

22 nonaffiliated person) its own promotion, except

23 that institutional advertising carried out by such

24 carrier shall be permitted so long as each party

25 bears its pro rata share of the costs; and
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•S 652 EAH

1 ‘‘(C) not own real or personal property in

2 common with such carrier.

3 ‘‘(2) INBOUND TELEMARKETING AND REFER4 RAL.—Notwithstanding paragraph (1)(B), a common

5 carrier may provide telemarketing or referral services

6 in response to the call of a customer or potential cus7 tomer related to the provision of video programming

8 by a video programming affiliate of such carrier. If

9 such services are provided to a video programming af10 filiate, such services shall be made available to any

11 video programmer or cable operator on request, on

12 nondiscriminatory terms, at just and reasonable

13 prices.

14 ‘‘(3) JOINT MARKETING.—Notwithstanding para15 graph (1)(B) or section 613(b)(3), a common carrier

16 may market video programming directly upon a

17 showing to the Commission that a cable operator or

18 other entity directly or indirectly provides tele19 communications services within the telephone service

20 area of the common carrier, and markets such tele21 communications services jointly with video program22 ming services. The common carrier shall specify the

23 geographic region covered by the showing. The Com24 mission shall approve or disapprove such showing

25 within 60 days after the date of its submission.
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•S 652 EAH

1 ‘‘(c) BUSINESS TRANSACTIONS WITH CARRIER.—Any

2 contract, agreement, arrangement, or other manner of con3 ducting business, between a common carrier and its video

4 programming affiliate, providing for—

5 ‘‘(1) the sale, exchange, or leasing of property be6 tween such affiliate and such carrier,

7 ‘‘(2) the furnishing of goods or services between

8 such affiliate and such carrier, or

9 ‘‘(3) the transfer to or use by such affiliate for

10 its benefit of any asset or resource of such carrier,

11 shall be on a fully compensatory and auditable basis, shall

12 be without cost to the telephone service ratepayers of the

13 carrier, and shall be in compliance with regulations estab14 lished by the Commission that will enable the Commission

15 to assess the compliance of any transaction.

16 ‘‘(d) WAIVER.—

17 ‘‘(1) CRITERIA FOR WAIVER.—The Commission

18 may waive any of the requirements of this section for

19 small telephone companies or telephone companies

20 serving rural areas, if the Commission determines,

21 after notice and comment, that—

22 ‘‘(A) such waiver will not affect the ability

23 of the Commission to ensure that all video pro24 gramming activity is carried out without any

25 support from telephone ratepayers;
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•S 652 EAH

1 ‘‘(B) the interests of telephone ratepayers

2 and cable subscribers will not be harmed if such

3 waiver is granted;

4 ‘‘(C) such waiver will not adversely affect

5 the ability of persons to obtain access to the

6 video platform of such carrier; and

7 ‘‘(D) such waiver otherwise is in the public

8 interest.

9 ‘‘(2) DEADLINE FOR ACTION.—The Commission

10 shall act to approve or disapprove a waiver applica11 tion within 180 days after the date it is filed.

12 ‘‘(3) CONTINUED APPLICABILITY OF SECTION

13 656.—In the case of a common carrier that obtains

14 a waiver under this subsection, any requirement that

15 section 656 applies to a video programming affiliate

16 shall instead apply to such carrier.

17 ‘‘(e) SUNSET OF REQUIREMENTS.—The provisions of

18 this section shall cease to be effective on July 1, 2000.

19 ‘‘SEC. 653. ESTABLISHMENT OF VIDEO PLATFORM.

20 ‘‘(a) VIDEO PLATFORM.—

21 ‘‘(1) IN GENERAL.—Except as provided in sec22 tion 613(b)(3), any common carrier subject to title II

23 of this Act, and that provides video programming di24 rectly to subscribers in its telephone service area, may

25 establish a video platform. This paragraph shall not
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•S 652 EAH

1 apply to any carrier to the extent that it provides

2 video programming directly to subscribers in its tele3 phone service area solely through a cable system ac4 quired in accordance with section 655(b).

5 ‘‘(2) IDENTIFICATION OF DEMAND FOR CAR6 RIAGE.—Any common carrier subject to the require7 ments of paragraph (1) shall, prior to establishing a

8 video platform, submit a notice to the Commission of

9 its intention to establish channel capacity for the pro10 vision of video programming to meet the bona fide de11 mand for such capacity. Such notice shall—

12 ‘‘(A) be in such form and contain informa13 tion concerning the geographic area intended to

14 be served and such information as the Commis15 sion may require by regulations pursuant to sub16 section (b);

17 ‘‘(B) specify the methods by which any en18 tity seeking to use such channel capacity should

19 submit to such carrier a specification of its

20 channel capacity requirements; and

21 ‘‘(C) specify the procedures by which such

22 carrier will determine (in accordance with the

23 Commission’s regulations under subsection

24 (b)(1)(B)) whether such requests for capacity are

25 bona fide.
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•S 652 EAH

1 The Commission shall submit any such notice for

2 publication in the Federal Register within 5 working

3 days.

4 ‘‘(3) RESPONSE TO REQUEST FOR CARRIAGE.—

5 After receiving and reviewing the requests for capac6 ity submitted pursuant to such notice, such common

7 carrier shall establish channel capacity that is suffi8 cient to provide carriage for—

9 ‘‘(A) all bona fide requests submitted pursu10 ant to such notice,

11 ‘‘(B) any additional channels required pur12 suant to section 656, and

13 ‘‘(C) any additional channels required by

14 the Commission’s regulations under subsection

15 (b)(1)(C).

16 ‘‘(4) RESPONSES TO CHANGES IN DEMAND FOR

17 CAPACITY.—Any common carrier that establishes a

18 video platform under this section shall—

19 ‘‘(A) immediately notify the Commission

20 and each video programming provider of any

21 delay in or denial of channel capacity or service,

22 and the reasons therefor;

23 ‘‘(B) continue to receive and grant, to the

24 extent of available capacity, carriage in response
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•S 652 EAH

1 to bona fide requests for carriage from existing

2 or additional video programming providers;

3 ‘‘(C) if at any time the number of channels

4 required for bona fide requests for carriage may

5 reasonably be expected soon to exceed the existing

6 capacity of such video platform, immediately no7 tify the Commission of such expectation and of

8 the manner and date by which such carrier will

9 provide sufficient capacity to meet such excess

10 demand; and

11 ‘‘(D) construct such additional capacity as

12 may be necessary to meet such excess demand.

13 ‘‘(5) DISPUTE RESOLUTION.—The Commission

14 shall have the authority to resolve disputes under this

15 section and the regulations prescribed thereunder.

16 Any such dispute shall be resolved within 180 days

17 after notice of such dispute is submitted to the Com18 mission. At that time or subsequently in a separate

19 damages proceeding, the Commission may award

20 damages sustained in consequence of any violation of

21 this section to any person denied carriage, or require

22 carriage, or both. Any aggrieved party may seek any

23 other remedy available under this Act.

24 ‘‘(b) COMMISSION ACTIONS.—
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•S 652 EAH

1 ‘‘(1) IN GENERAL.—Within 6 months after the

2 date of the enactment of this section, the Commission

3 shall complete all actions necessary (including any

4 reconsideration) to prescribe regulations that—

5 ‘‘(A) consistent with the requirements of sec6 tion 656, prohibit a common carrier from dis7 criminating among video programming provid8 ers with regard to carriage on its video platform,

9 and ensure that the rates, terms, and conditions

10 for such carriage are just, reasonable, and non11 discriminatory;

12 ‘‘(B) prescribe definitions and criteria for

13 the purposes of determining whether a request

14 shall be considered a bona fide request for pur15 poses of this section;

16 ‘‘(C) permit a common carrier to carry on

17 only one channel any video programming service

18 that is offered by more than one video program19 ming provider (including the common carrier’s

20 video programming affiliate), provided that sub21 scribers have ready and immediate access to any

22 such video programming service;

23 ‘‘(D) extend to the distribution of video pro24 gramming over video platforms the Commission’s

25 regulations concerning sports exclusivity (47
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•S 652 EAH

1 C.F.R. 76.67), network nonduplication (47

2 C.F.R. 76.92 et seq.), and syndicated exclusivity

3 (47 C.F.R. 76.151 et seq.);

4 ‘‘(E) require the video platform to provide

5 service, transmission, and interconnection for

6 unaffiliated or independent video programming

7 providers that is equivalent to that provided to

8 the common carrier’s video programming affili9 ate, except that the video platform shall not dis10 criminate between analog and digital video pro11 gramming offered by such unaffiliated or inde12 pendent video programming providers;

13 ‘‘(F)(i) prohibit a common carrier from un14 reasonably discriminating in favor of its video

15 programming affiliate with regard to material

16 or information provided by the common carrier

17 to subscribers for the purposes of selecting pro18 gramming on the video platform, or in the way

19 such material or information is presented to sub20 scribers;

21 ‘‘(ii) require a common carrier to ensure

22 that video programming providers or copyright

23 holders (or both) are able suitably and uniquely

24 to identify their programming services to sub25 scribers; and
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•S 652 EAH

1 ‘‘(iii) if such identification is transmitted

2 as part of the programming signal, require the

3 carrier to transmit such identification without

4 change or alteration; and

5 ‘‘(G) prohibit a common carrier from ex6 cluding areas from its video platform service

7 area on the basis of the ethnicity, race, or income

8 of the residents of that area, and provide for

9 public comments on the adequacy of the proposed

10 service area on the basis of the standards set

11 forth under this subparagraph.

12 Nothing in this section prohibits a common carrier or

13 its affiliate from negotiating mutually agreeable

14 terms and conditions with over-the-air broadcast sta15 tions and other unaffiliated video programming pro16 viders to allow consumer access to their signals on

17 any level or screen of any gateway, menu, or other

18 program guide, whether provided by the carrier or its

19 affiliate.

20 ‘‘(2) REGULATORY STREAMLINING.—With respect to

21 the establishment and operation of a video platform, the re22 quirements of this section shall apply in lieu of, and not

23 in addition to, the requirements of title II.
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•S 652 EAH

1 ‘‘SEC. 654. AUTHORITY TO PROHIBIT CROSS-SUBSIDIZA2 TION.

3 ‘‘Nothing in this part shall prohibit a State commis4 sion that regulates the rates for telephone exchange service

5 or exchange access based on the cost of providing such serv6 ice or access from—

7 ‘‘(1) prescribing regulations to prohibit a com8 mon carrier from engaging in any practice that re9 sults in the inclusion in rates for telephone exchange

10 service or exchange access of any operating expenses,

11 costs, depreciation charges, capital investments, or

12 other expenses directly associated with the provision

13 of competing video programming services by the com14 mon carrier or affiliate; or

15 ‘‘(2) ensuring such competing video program16 ming services bear a reasonable share of the joint and

17 common costs of facilities used to provide telephone

18 exchange service or exchange access and competing

19 video programming services.

20 ‘‘SEC. 655. PROHIBITION ON BUY OUTS.

21 ‘‘(a) GENERAL PROHIBITION.—No common carrier

22 that provides telephone exchange service, and no entity

23 owned by or under common ownership or control with such

24 carrier, may purchase or otherwise obtain control over any

25 cable system that is located within its telephone service area

26 and is owned by an unaffiliated person.
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•S 652 EAH

1 ‘‘(b) EXCEPTIONS.—Notwithstanding subsection (a), a

2 common carrier may—

3 ‘‘(1) obtain a controlling interest in, or form a

4 joint venture or other partnership with, a cable sys5 tem that serves a rural area;

6 ‘‘(2) obtain, in addition to any interest, joint

7 venture, or partnership obtained or formed pursuant

8 to paragraph (1), a controlling interest in, or form a

9 joint venture or other partnership with, any cable

10 system or systems if—

11 ‘‘(A) such systems in the aggregate serve less

12 than 10 percent of the households in the tele13 phone service area of such carrier; and

14 ‘‘(B) no such system serves a franchise area

15 with more than 35,000 inhabitants, except that

16 a common carrier may obtain such interest or

17 form such joint venture or other partnership

18 with a cable system that serves a franchise area

19 with more than 35,000 but not more than 50,000

20 inhabitants if such system is not affiliated with

21 any other system whose franchise area is contig22 uous to the franchise area of the acquired system;

23 ‘‘(3) obtain, with the concurrence of the cable op24 erator on the rates, terms, and conditions, the use of

25 that part of the transmission facilities of such a cable
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•S 652 EAH

1 system extending from the last multi-user terminal to

2 the premises of the end user, if such use is reasonably

3 limited in scope and duration, as determined by the

4 Commission; or

5 ‘‘(4) obtain a controlling interest in, or form a

6 joint venture or other partnership with, or provide fi7 nancing to, a cable system (hereinafter in this para8 graph referred to as ‘the subject cable system’), if—

9 ‘‘(A) the subject cable system operates in a

10 television market that is not in the top 25 mar11 kets, and that has more than 1 cable system op12 erator, and the subject cable system is not the

13 largest cable system in such television market;

14 ‘‘(B) the subject cable system and the largest

15 cable system in such television market held on

16 May 1, 1995, cable television franchises from the

17 largest municipality in the television market and

18 the boundaries of such franchises were identical

19 on such date;

20 ‘‘(C) the subject cable system is not owned

21 by or under common ownership or control of any

22 one of the 50 largest cable system operators as

23 existed on May 1, 1995; and

24 ‘‘(D) the largest system in the television

25 market is owned by or under common ownership
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1 or control of any one of the 10 largest cable sys2 tem operators as existed on May 1, 1995.

3 ‘‘(c) WAIVER.—

4 ‘‘(1) CRITERIA FOR WAIVER.—The Commission

5 may waive the restrictions in subsection (a) of this

6 section only upon a showing by the applicant that—

7 ‘‘(A) because of the nature of the market

8 served by the cable system concerned—

9 ‘‘(i) the incumbent cable operator

10 would be subjected to undue economic dis11 tress by the enforcement of such subsection;

12 or

13 ‘‘(ii) the cable system would not be eco14 nomically viable if such subsection were en15 forced; and

16 ‘‘(B) the local franchising authority ap17 proves of such waiver.

18 ‘‘(2) DEADLINE FOR ACTION.—The Commission

19 shall act to approve or disapprove a waiver applica20 tion within 180 days after the date it is filed.

21 ‘‘SEC. 656. APPLICABILITY OF PARTS I THROUGH IV.

22 ‘‘(a) IN GENERAL.—Any provision that applies to a

23 cable operator under—
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•S 652 EAH

1 ‘‘(1) sections 613 (other than subsection (a)(2)

2 thereof), 616, 617, 628, 631, 632, and 634 of this title,

3 shall apply,

4 ‘‘(2) sections 611, 612, 614, and 615 of this title,

5 and section 325 of title III, shall apply in accordance

6 with the regulations prescribed under subsection (b),

7 and

8 ‘‘(3) parts III and IV (other than sections 628,

9 631, 632, and 634) of this title shall not apply,

10 to any video programming affiliate established by a com11 mon carrier in accordance with the requirements of this

12 part.

13 ‘‘(b) IMPLEMENTATION.—

14 ‘‘(1) COMMISSION ACTION.—The Commission

15 shall prescribe regulations to ensure that a common

16 carrier in the operation of its video platform shall

17 provide (A) capacity, services, facilities, and equip18 ment for public, educational, and governmental use,

19 (B) capacity for commercial use, (C) carriage of com20 mercial and non-commercial broadcast television sta21 tions, and (D) an opportunity for commercial broad22 cast stations to choose between mandatory carriage

23 and reimbursement for retransmission of the signal of

24 such station. In prescribing such regulations, the

25 Commission shall, to the extent possible, impose obli-
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1 gations that are no greater or lesser than the obliga2 tions contained in the provisions described in sub3 section (a)(2) of this section.

4 ‘‘(2) FEES.—A video programming affiliate of

5 any common carrier that establishes a video platform

6 under this part, and any multichannel video pro7 gramming distributor offering a competing service

8 using such video platform (as determined in accord9 ance with regulations of the Commission), shall be

10 subject to the payment of fees imposed by a local fran11 chising authority, in lieu of the fees required under

12 section 622. The rate at which such fees are imposed

13 shall not exceed the rate at which franchise fees are

14 imposed on any cable operator transmitting video

15 programming in the same service area.

16 ‘‘SEC. 657. RURAL AREA EXEMPTION.

17 ‘‘The provisions of sections 652, 653, and 655 shall not

18 apply to video programming provided in a rural area by

19 a common carrier that provides telephone exchange service

20 in the same area.’’.

21 SEC. 202. COMPETITION FROM CABLE SYSTEMS.

22 (a) DEFINITION OF CABLE SERVICE.—Section

23 602(6)(B) of the Act (47 U.S.C. 522(6)(B)) is amended by

24 inserting ‘‘or use’’ after ‘‘the selection’’.
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•S 652 EAH

1 (b) CLUSTERING.—Section 613 of the Act (47 U.S.C.

2 533) is amended by adding at the end the following new

3 subsection:

4 ‘‘(i) ACQUISITION OF CABLE SYSTEMS.—Except as

5 provided in section 655, the Commission may not require

6 divestiture of, or restrict or prevent the acquisition of, an

7 ownership interest in a cable system by any person based

8 in whole or in part on the geographic location of such cable

9 system.’’.

10 (c) EQUIPMENT.—Section 623(a) of the Act (47 U.S.C.

11 543(a)) is amended—

12 (1) in paragraph (6)—

13 (A) by striking ‘‘paragraph (4)’’ and insert14 ing ‘‘paragraph (5)’’;

15 (B) by striking ‘‘paragraph (5)’’ and insert16 ing ‘‘paragraph (6)’’; and

17 (C) by striking ‘‘paragraph (3)’’ and insert18 ing ‘‘paragraph (4)’’;

19 (2) by redesignating paragraphs (3) through (6)

20 as paragraphs (4) through (7), respectively; and

21 (3) by inserting after paragraph (2) the follow22 ing new paragraph:

23 ‘‘(3) EQUIPMENT.—If the Commission finds that

24 a cable system is subject to effective competition under

25 subparagraph (D) of subsection (l)(1), the rates for
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1 equipment, installations, and connections for addi2 tional television receivers (other than equipment, in3 stallations, and connections furnished by such system

4 to subscribers who receive only a rate regulated basic

5 service tier) shall not be subject to regulation by the

6 Commission or by a State or franchising authority.

7 If the Commission finds that a cable system is subject

8 to effective competition under subparagraph (A), (B),

9 or (C) of subsection (l)(1), the rates for any equip10 ment, installations, and connections furnished by

11 such system to any subscriber shall not be subject to

12 regulation by the Commission, or by a State or fran13 chising authority. No Federal agency, State, or fran14 chising authority may establish the price or rate for

15 the installation, sale, or lease of any equipment fur16 nished to any subscriber by a cable system solely in

17 connection with video programming offered on a per

18 channel or per program basis.’’.

19 (d) LIMITATION ON BASIC TIER RATE INCREASES;

20 SCOPE OF REVIEW.—Section 623(a) of the Act (47 U.S.C.

21 543(a)) is further amended by adding at the end the follow22 ing new paragraph:

23 ‘‘(8) LIMITATION ON BASIC TIER RATE IN24 CREASES; SCOPE OF REVIEW.—A cable operator may

25 not increase its basic service tier rate more than once
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1 every 6 months. Such increase may be implemented,

2 using any reasonable billing or proration method, 30

3 days after providing notice to subscribers and the ap4 propriate regulatory authority. The rate resulting

5 from such increase shall be deemed reasonable and

6 shall not be subject to reduction or refund if the fran7 chising authority or the Commission, as appropriate,

8 does not complete its review and issue a final order

9 within 90 days after implementation of such increase.

10 The review by the franchising authority or the Com11 mission of any future increase in such rate shall be

12 limited to the incremental change in such rate effected

13 by such increase.’’.

14 (e) NATIONAL INFORMATION INFRASTRUCTURE DE15 VELOPMENT.—Section 623(a) of the Act (47 U.S.C. 543) is

16 further amended by adding at the end the following new

17 paragraph:

18 ‘‘(9) NATIONAL INFORMATION INFRASTRUC19 TURE.—

20 ‘‘(A) PURPOSE.—It is the purpose of this

21 paragraph to—

22 ‘‘(i) promote the development of the

23 National Information Infrastructure;

24 ‘‘(ii) enhance the competitiveness of the

25 National Information Infrastructure by en-
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1 suring that cable operators have incentives

2 comparable to other industries to develop

3 such infrastructure; and

4 ‘‘(iii) encourage the rapid deployment

5 of digital technology necessary to the devel6 opment of the National Information Infra7 structure.

8 ‘‘(B) AGGREGATION OF EQUIPMENT

9 COSTS.—The Commission shall allow cable oper10 ators, pursuant to any rules promulgated under

11 subsection (b)(3), to aggregate, on a franchise,

12 system, regional, or company level, their equip13 ment costs into broad categories, such as con14 verter boxes, regardless of the varying levels of

15 functionality of the equipment within each such

16 broad category. Such aggregation shall not be

17 permitted with respect to equipment used by sub18 scribers who receive only a rate regulated basic

19 service tier.

20 ‘‘(C) REVISION TO COMMISSION RULES;

21 FORMS.—Within 120 days of the date of enact22 ment of this paragraph, the Commission shall

23 issue revisions to the appropriate rules and

24 forms necessary to implement subparagraph

25 (B).’’.
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1 (f) COMPLAINT THRESHOLD; SCOPE OF COMMISSION

2 REVIEW.—Section 623(c) of the Act (47 U.S.C. 543(c)) is

3 amended—

4 (1) by striking paragraph (3) and inserting the

5 following:

6 ‘‘(3) REVIEW OF COMPLAINTS.—

7 ‘‘(A) COMPLAINT THRESHOLD.—The Com8 mission shall have the authority to review any

9 increase in the rates for cable programming serv10 ices implemented after the date of enactment of

11 the Communications Act of 1995 only if, within

12 90 days after such increase becomes effective, at

13 least 10 subscribers to such services or 3 percent

14 of the subscribers to such services, whichever is

15 greater, file separate, individual complaints

16 against such increase with the Commission in

17 accordance with the requirements established

18 under paragraph (1)(B).

19 ‘‘(B) TIME PERIOD FOR COMMISSION RE20 VIEW.—The Commission shall complete its re21 view of any such increase and issue a final order

22 within 90 days after it receives the number of

23 complaints required by subparagraph (A).

24 ‘‘(4) TREATMENT OF PENDING CABLE PROGRAM25 MING SERVICES COMPLAINTS.—Upon enactment of the
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1 Communications Act of 1995, the Commission shall

2 suspend the processing of all pending cable program3 ming services rate complaints. These pending com4 plaints shall be counted by the Commission toward

5 the complaint threshold specified in paragraph

6 (3)(A). Parties shall have an additional 90 days from

7 the date of enactment of such Act to file complaints

8 about prior increases in cable programming services

9 rates if such rate increases were already subject to a

10 valid, pending complaint on such date of enactment.

11 At the expiration of such 90-day period, the Commis12 sion shall dismiss all pending cable programming

13 services rate cases for which the complaint threshold

14 has not been met, and may resume its review of those

15 pending cable programming services rate cases for

16 which the complaint threshold has been met, which

17 review shall be completed within 180 days after the

18 date of enactment of the Communications Act of 1995.

19 ‘‘(5) SCOPE OF COMMISSION REVIEW.—A cable

20 programming services rate shall be deemed not unrea21 sonable and shall not be subject to reduction or refund

22 if—

23 ‘‘(A) such rate was not the subject of a

24 pending complaint at the time of enactment of

25 the Communications Act of 1995;
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1 ‘‘(B) such rate was the subject of a com2 plaint that was dismissed pursuant to para3 graph (4);

4 ‘‘(C) such rate resulted from an increase for

5 which the complaint threshold specified in para6 graph (3)(A) has not been met;

7 ‘‘(D) the Commission does not complete its

8 review and issue a final order in the time period

9 specified in paragraph (3)(B) or (4); or

10 ‘‘(E) the Commission issues an order find11 ing such rate to be not unreasonable.

12 The review by the Commission of any future increase

13 in such rate shall be limited to the incremental

14 change in such rate effected by such increase.’’;

15 (2) in paragraph (1)(B) by striking ‘‘obtain

16 Commission consideration and resolution of whether

17 the rate in question is unreasonable’’ and inserting

18 ‘‘be counted toward the complaint threshold specified

19 in paragraph (3)(A)’’; and

20 (3) in paragraph (1)(C) by striking ‘‘such com21 plaint’’ and inserting in lieu thereof ‘‘the first com22 plaint’’.

23 (g) UNIFORM RATE STRUCTURE.—Section 623(d) of

24 the Act (47 U.S.C. 543(d)) is amended to read as follows:
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1 ‘‘(d) UNIFORM RATE STRUCTURE.—A cable operator

2 shall have a uniform rate structure throughout its franchise

3 area for the provision of cable services that are regulated

4 by the Commission or the franchising authority. Bulk dis5 counts to multiple dwelling units shall not be subject to this

6 requirement.’’.

7 (h) EFFECTIVE COMPETITION.—Section 623(l)(1) of

8 the Act (47 U.S.C. 543(l)(1)) is amended—

9 (1) in subparagraph (B)(ii)—

10 (A) by inserting ‘‘all’’ before ‘‘multichannel

11 video programming distributors’’; and

12 (B) by striking ‘‘or’’ at the end thereof;

13 (2) by striking the period at the end of subpara14 graph (C) and inserting ‘‘; or’’; and

15 (3) by adding at the end the following:

16 ‘‘(D) with respect to cable programming

17 services and subscriber equipment, installations,

18 and connections for additional television receiv19 ers (other than equipment, installations, and

20 connections furnished to subscribers who receive

21 only a rate regulated basic service tier)—

22 ‘‘(i) a common carrier has been au23 thorized by the Commission to construct fa24 cilities to provide video dialtone service in

25 the cable operator’s franchise area;
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•S 652 EAH

1 ‘‘(ii) a common carrier has been au2 thorized by the Commission or pursuant to

3 a franchise to provide video programming

4 directly to subscribers in the franchise area;

5 or

6 ‘‘(iii) 270 days have elapsed since the

7 Commission has completed all actions nec8 essary (including any reconsideration) to

9 prescribe regulations pursuant to section

10 653(b)(1) relating to video platforms.’’.

11 (i) RELIEF FOR SMALL CABLE OPERATORS.—Section

12 623 of the Act (47 U.S.C. 543) is amended by adding at

13 the end the following new subsection:

14 ‘‘(m) SMALL CABLE OPERATORS.—

15 ‘‘(1) SMALL CABLE OPERATOR RELIEF.—A small

16 cable operator shall not be subject to subsections (a),

17 (b), (c), or (d) in any franchise area with respect to

18 the provision of cable programming services, or a

19 basic service tier where such tier was the only tier of20 fered in such area on December 31, 1994.

21 ‘‘(2) DEFINITION OF SMALL CABLE OPERATOR.—

22 For purposes of this subsection, ‘small cable operator’

23 means a cable operator that—
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•S 652 EAH

1 ‘‘(A) directly or through an affiliate, serves

2 in the aggregate fewer than 1 percent of all cable

3 subscribers in the United States; and

4 ‘‘(B) is not affiliated with any entity or en5 tities whose gross annual revenues in the aggre6 gate exceed $250,000,000.’’.

7 (j) TECHNICAL STANDARDS.—Section 624(e) of the Act

8 (47 U.S.C. 544(e)) is amended by striking the last two sen9 tences and inserting the following: ‘‘No State or franchising

10 authority may prohibit, condition, or restrict a cable sys11 tem’s use of any type of subscriber equipment or any trans12 mission technology.’’.

13 (k) CABLE SECURITY SYSTEMS.—Section 624A(b)(2)

14 of the Act (47 U.S.C. 544a(b)(2)) is amended to read as

15 follows:

16 ‘‘(2) CABLE SECURITY SYSTEMS.—No Federal

17 agency, State, or franchising authority may prohibit

18 a cable operator’s use of any security system (includ19 ing scrambling, encryption, traps, and interdiction),

20 except that the Commission may prohibit the use of

21 any such system solely with respect to the delivery of

22 a basic service tier that, as of January 1, 1995, con23 tained only the signals and programming specified in

24 section 623(b)(7)(A), unless the use of such system is
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•S 652 EAH

1 necessary to prevent the unauthorized reception of

2 such tier.’’.

3 (l) CABLE EQUIPMENT COMPATIBILITY.—Section

4 624A of the Act (47 U.S.C. 544A), is amended—

5 (1) in subsection (a) by striking ‘‘and’’ at the

6 end of paragraph (2), by striking the period at the

7 end of paragraph (3) and inserting ‘‘; and’’; and by

8 adding at the end the following new paragraph:

9 ‘‘(4) compatibility among televisions, video cas10 sette recorders, and cable systems can be assured with

11 narrow technical standards that mandate a minimum

12 degree of common design and operation, leaving all

13 features, functions, protocols, and other product and

14 service options for selection through open competition

15 in the market.’’;

16 (2) in subsection (c)(1)—

17 (A) by redesignating subparagraphs (A)

18 and (B) as subparagraphs (B) and (C), respec19 tively; and

20 (B) by inserting before such redesignated

21 subparagraph (B) the following new subpara22 graph:

23 ‘‘(A) the need to maximize open competition

24 in the market for all features, functions, proto25 cols, and other product and service options of
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•S 652 EAH

1 converter boxes and other cable converters unre2 lated to the descrambling or decryption of cable

3 television signals;’’; and

4 (3) in subsection (c)(2)—

5 (A) by redesignating subparagraphs (D)

6 and (E) as subparagraphs (E) and (F), respec7 tively; and

8 (B) by inserting after subparagraph (C) the

9 following new subparagraph:

10 ‘‘(D) to ensure that any standards or regu11 lations developed under the authority of this sec12 tion to ensure compatibility between televisions,

13 video casette recorders, and cable systems do not

14 affect features, functions, protocols, and other

15 product and service options other than those

16 specified in paragraph (1)(B), including tele17 communications interface equipment, home auto18 mation communications, and computer network

19 services;’’.

20 (m) RETIERING OF BASIC TIER SERVICES.—Section

21 625(d) of the Act (47 U.S.C. 543(d)) is amended by adding

22 at the end the following new sentence: ‘‘Any signals or serv23 ices carried on the basic service tier but not required under

24 section 623(b)(7)(A) may be moved from the basic service

25 tier at the operator’s sole discretion, provided that the re-
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•S 652 EAH

1 moval of such a signal or service from the basic service tier

2 is permitted by contract. The movement of such signals or

3 services to an unregulated package of services shall not sub4 ject such package to regulation.’’.

5 (n) SUBSCRIBER NOTICE.—Section 632 of the Act (47

6 U.S.C. 552) is amended—

7 (1) by redesignating subsection (c) as subsection

8 (d); and

9 (2) by inserting after subsection (b) the following

10 new subsection:

11 ‘‘(c) SUBSCRIBER NOTICE.—A cable operator may pro12 vide notice of service and rate changes to subscribers using

13 any reasonable written means at its sole discretion. Not14 withstanding section 623(b)(6) or any other provision of

15 this Act, a cable operator shall not be required to provide

16 prior notice of any rate change that is the result of a regu17 latory fee, franchise fee, or any other fee, tax, assessment,

18 or charge of any kind imposed by any Federal agency,

19 State, or franchising authority on the transaction between

20 the operator and the subscriber.’’.

21 (o) TREATMENT OF PRIOR YEAR LOSSES.—

22 (1) AMENDMENT.—Section 623 (48 U.S.C. 543)

23 is amended by adding at the end thereof the following:

24 ‘‘(n) TREATMENT OF PRIOR YEAR LOSSES.—Notwith25 standing any other provision of this section or of section
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1 612, losses (including losses associated with the acquisitions

2 of such franchise) that were incurred prior to September

3 4, 1992, with respect to a cable system that is owned and

4 operated by the original franchisee of such system shall not

5 be disallowed, in whole or in part, in the determination

6 of whether the rates for any tier of service or any type of

7 equipment that is subject to regulation under this section

8 are lawful.’’.

9 (2) EFFECTIVE DATE.—The amendment made by

10 paragraph (1) shall take effect on the date of enact11 ment of this Act and shall be applicable to any rate

12 proposal filed on or after September 4, 1993.

13 SEC. 203. COMPETITIVE AVAILABILITY OF NAVIGATION DE14 VICES.

15 Title VII of the Act is amended by adding at the end

16 the following new section:

17 ‘‘SEC. 713. COMPETITIVE AVAILABILITY OF NAVIGATION DE18 VICES.

19 ‘‘(a) DEFINITIONS.—As used in this section:

20 ‘‘(1) The term ‘telecommunications subscription

21 service’ means the provision directly to subscribers of

22 video, voice, or data services for which a subscriber

23 charge is made.
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•S 652 EAH

1 ‘‘(2) The term ‘telecommunications system’ or a

2 ‘telecommunications system operator’ means a pro3 vider of telecommunications subscription service.

4 ‘‘(b) COMPETITIVE CONSUMER AVAILABILITY OF CUS5 TOMER PREMISES EQUIPMENT.—The Commission shall

6 adopt regulations to assure competitive availability, to con7 sumers of telecommunications subscription services, of con8 verter boxes, interactive communications devices, and other

9 customer premises equipment from manufacturers, retail10 ers, and other vendors not affiliated with any telecommuni11 cations system operator. Such regulations shall not prohibit

12 any telecommunications system operator from also offering

13 devices and customer premises equipment to consumers,

14 provided that the system operator’s charges to consumers

15 for such devices and equipment are separately stated and

16 not subsidized by charges for any telecommunications sub17 scription service.

18 ‘‘(c) PROTECTION OF SYSTEM SECURITY.—The Com19 mission shall not prescribe regulations pursuant to sub20 section (b) which would jeopardize the security of a tele21 communications system or impede the legal rights of a pro22 vider of such service to prevent theft of service.

23 ‘‘(d) WAIVER FOR NEW NETWORK SERVICES.—The

24 Commission shall waive a regulation adopted pursuant to

25 subsection (b) for a limited time upon an appropriate show-
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1 ing by a telecommunications system operator that such

2 waiver is necessary to assist the development or introduc3 tion of a new or improved telecommunications subscription

4 service or technology.

5 ‘‘(e) AVOIDANCE OF REDUNDANT REGULATIONS.—

6 ‘‘(1) MARKET COMPETITIVENESS DETERMINA7 TIONS.—Determinations made or regulations pre8 scribed by the Commission with respect to market

9 competitiveness of customer premises equipment prior

10 to the date of enactment of this section shall fulfill the

11 requirements of this section.

12 ‘‘(2) REGULATIONS.—Nothing in this section af13 fects the Commission’s regulations governing the

14 interconnection and competitive provision of customer

15 premises equipment used in connection with basic

16 telephone service.

17 ‘‘(f) SUNSET.—The regulations adopted pursuant to

18 this section shall cease to apply to any market for the acqui19 sition of converter boxes, interactive communications de20 vices, or other customer premises equipment when the Com21 mission determines that such market is competitive.’’.

22 SEC. 204. VIDEO PROGRAMMING ACCESSIBILITY.

23 (a) COMMISSION INQUIRY.—Within 180 days after the

24 date of enactment of this section, the Federal Communica25 tions Commission shall complete an inquiry to ascertain
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1 the level at which video programming is closed captioned.

2 Such inquiry shall examine the extent to which existing or

3 previously published programming is closed captioned, the

4 size of the video programming provider or programming

5 owner providing closed captioning, the size of the market

6 served, the relative audience shares achieved, or any other

7 related factors. The Commission shall submit to the Con8 gress a report on the results of such inquiry.

9 (b) ACCOUNTABILITY CRITERIA.—Within 18 months

10 after the date of enactment, the Commission shall prescribe

11 such regulations as are necessary to implement this section.

12 Such regulations shall ensure that—

13 (1) video programming first published or exhib14 ited after the effective date of such regulations is fully

15 accessible through the provision of closed captions, ex16 cept as provided in subsection (d); and

17 (2) video programming providers or owners

18 maximize the accessibility of video programming first

19 published or exhibited prior to the effective date of

20 such regulations through the provision of closed cap21 tions, except as provided in subsection (d).

22 (c) DEADLINES FOR CAPTIONING.—Such regulations

23 shall include an appropriate schedule of deadlines for the

24 provision of closed captioning of video programming.

25 (d) EXEMPTIONS.—Notwithstanding subsection (b)—
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1 (1) the Commission may exempt by regulation

2 programs, classes of programs, or services for which

3 the Commission has determined that the provision of

4 closed captioning would be economically burdensome

5 to the provider or owner of such programming;

6 (2) a provider of video programming or the

7 owner of any program carried by the provider shall

8 not be obligated to supply closed captions if such ac9 tion would be inconsistent with contracts in effect on

10 the date of enactment of this Act, except that nothing

11 in this section shall be construed to relieve a video

12 programming provider of its obligations to provide

13 services required by Federal law; and

14 (3) a provider of video programming or program

15 owner may petition the Commission for an exemption

16 from the requirements of this section, and the Com17 mission may grant such petition upon a showing that

18 the requirements contained in this section would re19 sult in an undue burden.

20 (e) UNDUE BURDEN.—The term ‘‘undue burden’’

21 means significant difficulty or expense. In determining

22 whether the closed captions necessary to comply with the

23 requirements of this paragraph would result in an undue

24 economic burden, the factors to be considered include—
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1 (1) the nature and cost of the closed captions for

2 the programming;

3 (2) the impact on the operation of the provider

4 or program owner;

5 (3) the financial resources of the provider or pro6 gram owner; and

7 (4) the type of operations of the provider or pro8 gram owner.

9 (f) VIDEO DESCRIPTIONS INQUIRY.—Within 6 months

10 after the date of enactment of this Act, the Commission shall

11 commence an inquiry to examine the use of video descrip12 tions on video programming in order to ensure the acces13 sibility of video programming to persons with visual im14 pairments, and report to Congress on its findings. The

15 Commission’s report shall assess appropriate methods and

16 schedules for phasing video descriptions into the market17 place, technical and quality standards for video descrip18 tions, a definition of programming for which video descrip19 tions would apply, and other technical and legal issues that

20 the Commission deems appropriate. Following the comple21 tion of such inquiry, the Commission may adopt regulation

22 it deems necessary to promote the accessibility of video pro23 gramming to persons with visual impairments.

24 (g) VIDEO DESCRIPTION.—For purposes of this sec25 tion, ‘‘video description’’ means the insertion of audio nar-
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•S 652 EAH

1 rated descriptions of a television program’s key visual ele2 ments into natural pauses between the program’s dialogue.

3 (h) PRIVATE RIGHTS OF ACTIONS PROHIBITED.—

4 Nothing in this section shall be construed to authorize any

5 private right of action to enforce any requirement of this

6 section or any regulation thereunder. The Commission shall

7 have exclusive jurisdiction with respect to any complaint

8 under this section.

9 SEC. 205. TECHNICAL AMENDMENTS.

10 (a) RETRANSMISSION.—Section 325(b)(2)(D) of the

11 Act (47 U.S.C. 325(b)(2)(D)) is amended to read as follows:

12 ‘‘(D) retransmission by a cable operator or other

13 multichannel video programming distributor of the

14 signal of a superstation if (i) the customers served by

15 the cable operator or other multichannel video pro16 gramming distributor reside outside the originating

17 station’s television market, as defined by the Commis18 sion for purposes of section 614(h)(1)(C); (ii) such

19 signal was obtained from a satellite carrier or terres20 trial microwave common carrier; and (iii) and the

21 origination station was a superstation on May 1,

22 1991.’’.

23 (b) MARKET DETERMINATIONS.—Section

24 614(h)(1)(C)(i) of the Act (47 U.S.C. 534(h)(1)(C)(i)) is

25 amended by striking out ‘‘in the manner provided in section
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•S 652 EAH

1 73.3555(d)(3)(i) of title 47, Code of Federal Regulations,

2 as in effect on May 1, 1991,’’ and inserting ‘‘by the Com3 mission by regulation or order using, where available, com4 mercial publications which delineate television markets

5 based on viewing patterns,’’.

6 (c) TIME FOR DECISION.—Section 614(h)(1)(C)(iv) of

7 such Act is amended to read as follows:

8 ‘‘(iv) Within 120 days after the date a re9 quest is filed under this subparagraph, the Com10 mission shall grant or deny the request.’’.

11 (d) PROCESSING OF PENDING COMPLAINTS.—The

12 Commission shall, unless otherwise informed by the person

13 making the request, assume that any person making a re14 quest to include or exclude additional communities under

15 section 614(h)(1)(C) of such Act (as in effect prior to the

16 date of enactment of this Act) continues to request such in17 clusion or exclusion under such section as amended under

18 subsection (b).

19 TITLE III—BROADCAST COMMU20 NICATIONS COMPETITIVE21 NESS

22 SEC. 301. BROADCASTER SPECTRUM FLEXIBILITY.

23 Title III of the Act is amended by inserting after sec24 tion 335 (47 U.S.C. 335) the following new section:
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1 ‘‘SEC. 336. BROADCAST SPECTRUM FLEXIBILITY.

2 ‘‘(a) COMMISSION ACTION.—If the Commission deter3 mines to issue additional licenses for advanced television

4 services, the Commission shall—

5 ‘‘(1) limit the initial eligibility for such licenses

6 to persons that, as of the date of such issuance, are

7 licensed to operate a television broadcast station or

8 hold a permit to construct such a station (or both);

9 and

10 ‘‘(2) adopt regulations that allow such licensees

11 or permittees to offer such ancillary or supplementary

12 services on designated frequencies as may be consist13 ent with the public interest, convenience, and neces14 sity.

15 ‘‘(b) CONTENTS OF REGULATIONS.—In prescribing the

16 regulations required by subsection (a), the Commission

17 shall—

18 ‘‘(1) only permit such licensee or permittee to

19 offer ancillary or supplementary services if the use of

20 a designated frequency for such services is consistent

21 with the technology or method designated by the Com22 mission for the provision of advanced television serv23 ices;

24 ‘‘(2) limit the broadcasting of ancillary or sup25 plementary services on designated frequencies so as to

26 avoid derogation of any advanced television services,
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•S 652 EAH

1 including high definition television broadcasts, that

2 the Commission may require using such frequencies;

3 ‘‘(3) apply to any other ancillary or supple4 mentary service such of the Commission’s regulations

5 as are applicable to the offering of analogous services

6 by any other person, except that no ancillary or sup7 plementary service shall have any rights to carriage

8 under section 614 or 615 or be deemed a multichannel

9 video programming distributor for purposes of section

10 628;

11 ‘‘(4) adopt such technical and other requirements

12 as may be necessary or appropriate to assure the

13 quality of the signal used to provide advanced tele14 vision services, and may adopt regulations that stipu15 late the minimum number of hours per day that such

16 signal must be transmitted; and

17 ‘‘(5) prescribe such other regulations as may be

18 necessary for the protection of the public interest, con19 venience, and necessity.

20 ‘‘(c) RECOVERY OF LICENSE.—

21 ‘‘(1) CONDITIONS REQUIRED.—If the Commis22 sion grants a license for advanced television services

23 to a person that, as of the date of such issuance, is

24 licensed to operate a television broadcast station or

25 holds a permit to construct such a station (or both),
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1 the Commission shall, as a condition of such license,

2 require that, upon a determination by the Commis3 sion pursuant to the regulations prescribed under

4 paragraph (2), either the additional license or the

5 original license held by the licensee be surrendered to

6 the Commission in accordance with such regulations

7 for reallocation or reassignment (or both) pursuant

8 to Commission regulation.

9 ‘‘(2) CRITERIA.—The Commission shall prescribe

10 criteria for rendering determinations concerning li11 cense surrender pursuant to license conditions re12 quired by paragraph (1). Such criteria shall—

13 ‘‘(A) require such determinations to be

14 based, on a market-by-market basis, on whether

15 the substantial majority of the public have ob16 tained television receivers that are capable of re17 ceiving advanced television services; and

18 ‘‘(B) not require the cessation of the broad19 casting under either the original or additional

20 license if such cessation would render the tele21 vision receivers of a substantial portion of the

22 public useless, or otherwise cause undue burdens

23 on the owners of such television receivers.

24 ‘‘(3) AUCTION OF RETURNED SPECTRUM.—Any

25 license surrendered under the requirements of this
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1 subsection shall be subject to assignment by use of

2 competitive bidding pursuant to section 309(j), not3 withstanding any limitations contained in paragraph

4 (2) of such section.

5 ‘‘(d) FEES.—

6 ‘‘(1) SERVICES TO WHICH FEES APPLY.—If the

7 regulations prescribed pursuant to subsection (a) per8 mit a licensee to offer ancillary or supplementary

9 services on a designated frequency—

10 ‘‘(A) for which the payment of a subscrip11 tion fee is required in order to receive such serv12 ices, or

13 ‘‘(B) for which the licensee directly or indi14 rectly receives compensation from a third party

15 in return for transmitting material furnished by

16 such third party (other than commercial adver17 tisements used to support broadcasting for which

18 a subscription fee is not required),

19 the Commission shall establish a program to assess

20 and collect from the licensee for such designated fre21 quency an annual fee or other schedule or method of

22 payment that promotes the objectives described in sub23 paragraphs (A) and (B) of paragraph (2).

24 ‘‘(2) COLLECTION OF FEES.—The program re25 quired by paragraph (1) shall—
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1 ‘‘(A) be designed (i) to recover for the public

2 a portion of the value of the public spectrum re3 source made available for such commercial use,

4 and (ii) to avoid unjust enrichment through the

5 method employed to permit such uses of that re6 source;

7 ‘‘(B) recover for the public an amount that,

8 to the extent feasible, equals but does not exceed

9 (over the term of the license) the amount that

10 would have been recovered had such services been

11 licensed pursuant to the provisions of section

12 309(j) of this Act and the Commission’s regula13 tions thereunder; and

14 ‘‘(C) be adjusted by the Commission from

15 time to time in order to continue to comply with

16 the requirements of this paragraph.

17 ‘‘(3) TREATMENT OF REVENUES.—

18 ‘‘(A) GENERAL RULE.—Except as provided

19 in subparagraph (B), all proceeds obtained pur20 suant to the regulations required by this sub21 section shall be deposited in the Treasury in ac22 cordance with chapter 33 of title 31, United

23 States Code.

24 ‘‘(B) RETENTION OF REVENUES.—Notwith25 standing subparagraph (A), the salaries and ex-
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1 penses account of the Commission shall retain as

2 an offsetting collection such sums as may be nec3 essary from such proceeds for the costs of devel4 oping and implementing the program required

5 by this section and regulating and supervising

6 advanced television services. Such offsetting col7 lections shall be available for obligation subject

8 to the terms and conditions of the receiving ap9 propriations account, and shall be deposited in

10 such accounts on a quarterly basis.

11 ‘‘(4) REPORT.—Within 5 years after the date of

12 the enactment of this section, the Commission shall

13 report to the Congress on the implementation of the

14 program required by this subsection, and shall annu15 ally thereafter advise the Congress on the amounts

16 collected pursuant to such program.

17 ‘‘(e) EVALUATION.—Within 10 years after the date the

18 Commission first issues additional licenses for advanced tel19 evision services, the Commission shall conduct an evalua20 tion of the advanced television services program. Such eval21 uation shall include—

22 ‘‘(1) an assessment of the willingness of consum23 ers to purchase the television receivers necessary to re24 ceive broadcasts of advanced television services;
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1 ‘‘(2) an assessment of alternative uses, including

2 public safety use, of the frequencies used for such

3 broadcasts; and

4 ‘‘(3) the extent to which the Commission has been

5 or will be able to reduce the amount of spectrum as6 signed to licensees.

7 ‘‘(f) DEFINITIONS.—As used in this section:

8 ‘‘(1) ADVANCED TELEVISION SERVICES.—The

9 term ‘advanced television services’ means television

10 services provided using digital or other advanced tech11 nology as further defined in the opinion, report, and

12 order of the Commission entitled ‘Advanced Television

13 Systems and Their Impact Upon the Existing Tele14 vision Broadcast Service’, MM Docket 87–268, adopt15 ed September 17, 1992, and successor proceedings.

16 ‘‘(2) DESIGNATED FREQUENCIES.—The term

17 ‘designated frequency’ means each of the frequencies

18 designated by the Commission for licenses for ad19 vanced television services.

20 ‘‘(3) HIGH DEFINITION TELEVISION.—The term

21 ‘high definition television’ refers to systems that offer

22 approximately twice the vertical and horizontal reso23 lution of receivers generally available on the date of

24 enactment of this section, as further defined in the
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1 proceedings described in paragraph (1) of this sub2 section.’’.

3 SEC. 302. BROADCAST OWNERSHIP.

4 Title III of the Act is amended by inserting after sec5 tion 336 (as added by section 301) the following new sec6 tion:

7 ‘‘SEC. 337. BROADCAST OWNERSHIP.

8 ‘‘(a) LIMITATIONS ON COMMISSION RULEMAKING AU9 THORITY.—Except as expressly permitted in this section,

10 and consistent with section 613(a) of the Act, the Commis11 sion shall not prescribe or enforce any regulation—

12 ‘‘(1) prohibiting or limiting, either nationally or

13 within any particular area, a person or entity from

14 holding any form of ownership or other interest in

15 two or more broadcasting stations or in a broadcast16 ing station and any other medium of mass commu17 nication; or

18 ‘‘(2) prohibiting a person or entity from owning,

19 operating, or controlling two or more networks of

20 broadcasting stations or from owning, operating, or

21 controlling a network of broadcasting stations and

22 any other medium of mass communications.

23 ‘‘(b) TELEVISION OWNERSHIP LIMITATIONS.—

24 ‘‘(1) NATIONAL AUDIENCE REACH LIMITA25 TIONS.—The Commission shall prohibit a person or
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1 entity from obtaining any license if such license

2 would result in such person or entity directly or indi3 rectly owning, operating, or controlling, or having a

4 cognizable interest in, television stations which have

5 an aggregate national audience reach exceeding 35

6 percent. Within 3 years after such date of enactment,

7 the Commission shall conduct a study on the oper8 ation of this paragraph and submit a report to the

9 Congress on the development of competition in the tel10 evision marketplace and the need for any revisions to

11 or elimination of this paragraph.

12 ‘‘(2) MULTIPLE LICENSES IN A MARKET.—

13 ‘‘(A) IN GENERAL.—The Commission shall

14 prohibit a person or entity from obtaining any

15 license if such license would result in such person

16 or entity directly or indirectly owning, operat17 ing, or controlling, or having a cognizable inter18 est in, two or more television stations within the

19 same television market.

20 ‘‘(B) EXCEPTION FOR MULTIPLE UHF STA21 TIONS AND FOR UHF-VHF COMBINATIONS.—Not22 withstanding subparagraph (A), the Commission

23 shall not prohibit a person or entity from di24 rectly or indirectly owning, operating, or con25 trolling, or having a cognizable interest in, two
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1 television stations within the same television

2 market if at least one of such stations is a UHF

3 television, unless the Commission determines that

4 permitting such ownership, operation, or control

5 will harm competition or will harm the preser6 vation of a diversity of media voices in the local

7 television market.

8 ‘‘(C) EXCEPTION FOR VHF-VHF COMBINA9 TIONS.—Notwithstanding subparagraph (A), the

10 Commission may permit a person or entity to

11 directly or indirectly own, operate, or control, or

12 have a cognizable interest in, two VHF television

13 stations within the same television market, if the

14 Commission determines that permitting such

15 ownership, operation, or control will not harm

16 competition and will not harm the preservation

17 of a diversity of media voices in the local tele18 vision market.

19 ‘‘(c) LOCAL CROSS-MEDIA OWNERSHIP LIMITS.—In a

20 proceeding to grant, renew, or authorize the assignment of

21 any station license under this title, the Commission may

22 deny the application if the Commission determines that the

23 combination of such station and more than one other

24 nonbroadcast media of mass communication would result

25 in an undue concentration of media voices in the respective
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1 local market. In considering any such combination, the

2 Commission shall not grant the application if all the media

3 of mass communication in such local market would be

4 owned, operated, or controlled by two or fewer persons or

5 entities. This subsection shall not constitute authority for

6 the Commission to prescribe regulations containing local

7 cross-media ownership limitations. The Commission may

8 not, under the authority of this subsection, require any per9 son or entity to divest itself of any portion of any combina10 tion of stations and other media of mass communications

11 that such person or entity owns, operates, or controls on

12 the date of enactment of this section unless such person or

13 entity acquires another station or other media of mass com14 munications after such date in such local market.

15 ‘‘(d) TRANSITION PROVISIONS.—Any provision of any

16 regulation prescribed before the date of enactment of this

17 section that is inconsistent with the requirements of this

18 section shall cease to be effective on such date of enactment.

19 The Commission shall complete all actions (including any

20 reconsideration) necessary to amend its regulations to con21 form to the requirements of this section not later than 6

22 months after such date of enactment. Nothing in this section

23 shall be construed to prohibit the continuation or renewal

24 of any television local marketing agreement that is in effect
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1 on such date of enactment and that is in compliance with

2 Commission regulations on such date.’’.

3 SEC. 303. FOREIGN INVESTMENT AND OWNERSHIP.

4 (a) STATION LICENSES.—Section 310(a) (47 U.S.C.

5 310(a)) is amended to read as follows:

6 ‘‘(a) GRANT TO OR HOLDING BY FOREIGN GOVERN7 MENT OR REPRESENTATIVE.—No station license required

8 under title III of this Act shall be granted to or held by

9 any foreign government or any representative thereof. This

10 subsection shall not apply to licenses issued under such

11 terms and conditions as the Commission may prescribe to

12 mobile earth stations engaged in occasional or short-term

13 transmissions via satellite of audio or television program

14 material and auxilliary signals if such transmissions are

15 not intended for direct reception by the general public in

16 the United States.’’.

17 (b) TERMINATION OF FOREIGN OWNERSHIP RESTRIC18 TIONS.—Section 310 (47 U.S.C. 310) is amended by adding

19 at the end thereof the following new subsection:

20 ‘‘(f) TERMINATION OF FOREIGN OWNERSHIP RESTRIC21 TIONS.—

22 ‘‘(1) RESTRICTION NOT TO APPLY.—Subsection

23 (b) shall not apply to any common carrier license

24 granted, held, or for which application is made, after

25 the date of enactment of this subsection with respect
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1 to any alien (or representative thereof), corporation,

2 or foreign government (or representative thereof) if—

3 ‘‘(A) the President determines—

4 ‘‘(i) that the foreign country of which

5 such alien is a citizen, in which such cor6 poration is organized, or in which the for7 eign government is in control is party to an

8 international agreement which requires the

9 United States to provide national or most10 favored-nation treatment in the grant of

11 common carrier licenses; and

12 ‘‘(ii) that not applying subsection (b)

13 would be consistent with national security

14 and effective law enforcement; or

15 ‘‘(B) the Commission determines that not

16 applying subsection (b) would serve the public

17 interest.

18 ‘‘(2) COMMISSION CONSIDERATIONS.—In making

19 its determination under paragraph (1), the Commis20 sion shall abide by any decision of the President

21 whether application of section (b) is in the public in22 terest due to national security, law enforcement, for23 eign policy or trade (including direct investment as

24 it relates to international trade policy) concerns, or

25 due to the interpretation of international agreements.
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1 In the absence of a decision by the President, the

2 Commission may consider, among other public inter3 est factors, whether effective competitive opportunities

4 are available to United States nationals or corpora5 tions in the applicant’s home market. Upon receipt of

6 an application that requires a determination under

7 this paragraph, the Commission shall cause notice of

8 the application to be given to the President or any

9 agencies designated by the President to receive such

10 notification. The Commission shall not make a deter11 mination under paragraph (1)(B) earlier than 30

12 days after the end of the pleading cycle or later than

13 180 days after the end of the pleading cycle.

14 ‘‘(3) FURTHER COMMISSION REVIEW.—The Com15 mission may determine that, due to changed cir16 cumstances relating to United States national secu17 rity or law enforcement, a prior determination under

18 paragraph (1) ought to be reversed or altered. In

19 making this determination, the Commission shall ac20 cord great deference to any recommendation of the

21 President with respect to United States national secu22 rity or law enforcement. If a determination under

23 this paragraph is made then—

24 ‘‘(A) subsection (b) shall apply with respect

25 to such aliens, corporation, and government (or
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1 their representatives) on the date that the Com2 mission publishes notice of its determination

3 under this paragraph; and

4 ‘‘(B) any license held, or application filed,

5 which could not be held or granted under sub6 section (b) shall be reviewed by the Commission

7 under the provisions of paragraphs (1)(B) and

8 (2).

9 ‘‘(4) NOTIFICATION TO CONGRESS.—The Presi10 dent and the Commission shall notify the appropriate

11 committees of the Congress of any determinations

12 made under paragraph (1), (2), or (3).

13 ‘‘(5) MISCELLANEOUS.—Any Presidential deci14 sions made under the provisions of this subsection

15 shall not be subject to judicial review.’’.

16 (c) EFFECTIVE DATES.—The amendments made by

17 this section shall not apply to any proceeding commenced

18 before the date of enactment of this Act.

19 SEC. 304. FAMILY VIEWING EMPOWERMENT.

20 (a) FINDINGS.—The Congress makes the following

21 findings:

22 (1) Television is pervasive in daily life and ex23 erts a powerful influence over the perceptions of view24 ers, especially children, concerning the society in

25 which we live.
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1 (2) Children completing elementary school have

2 been exposed to 25 or more hours of television per

3 week and as many as 11 hours per day.

4 (3) Children completing elementary school have

5 been exposed to an estimated average of 8,000 mur6 ders and 100,000 acts of violence on television.

7 (4) Studies indicate that the exposure of young

8 children to such levels of violent programming cor9 relates to an increased tendency toward and tolerance

10 of violent and aggressive behavior in later years.

11 (5) Studies also suggest that the depiction of

12 other material such as sexual conduct in a cavalier

13 and amoral context may undermine the ability of

14 parents to instill in their children responsible atti15 tudes regarding such activities.

16 (6) Studies also suggest that a significant rela17 tionship exists between exposure to television violence

18 and antisocial acts, including serious, violent crimi19 nal offenses.

20 (7) Parents and other viewers are increasingly

21 demanding that they be empowered to make and im22 plement viewing choices for themselves and their fam23 ilies.
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1 (8) The public is becoming increasingly aware of

2 and concerned about objectionable video programming

3 content.

4 (9) The broadcast television industry and other

5 video programmers have a responsibility to assess the

6 impact of their work and to understand the damage

7 that comes from the incessant, repetitive, mindless vi8 olence and irresponsible content.

9 (10) The broadcast television industry and other

10 video programming distributors should be committed

11 to facilitating viewers’ access to the information and

12 capabilities required to prevent the exposure of their

13 children to excessively violent and otherwise objection14 able and harmful video programming.

15 (11) The technology for implementing individual

16 viewing choices is rapidly advancing and numerous

17 options for viewer control are or soon will be avail18 able in the marketplace at affordable prices.

19 (12) There is a compelling national interest in

20 ensuring that parents are provided with the informa21 tion and capabilities required to prevent the exposure

22 of their children to excessively violent and otherwise

23 objectionable and harmful video programming.

24 (b) POLICY.—It is the policy of the United States to—
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1 (1) encourage broadcast television, cable, sat2 ellite, syndication, other video programming distribu3 tors, and relevant related industries (in consultation

4 with appropriate public interest groups and inter5 ested individuals from the private sector) to—

6 (A) establish a technology fund to encourage

7 television and electronics equipment manufactur8 ers to facilitate the development of technology

9 which would empower parents to block program10 ming they deem inappropriate for their children;

11 (B) report to the viewing public on the sta12 tus of the development of affordable, easy to use

13 blocking technology; and

14 (C) establish and promote effective proce15 dures, standards, systems, advisories, or other

16 mechanisms for ensuring that users have easy

17 and complete access to the information necessary

18 to effectively utilize blocking technology; and

19 (2) evaluate whether, not later than 1 year after

20 the date of enactment of this Act, industry-wide pro21 cedures, standards, systems advisories, or other mech22 anisms established by the broadcast television, cable

23 satellite, syndication, other video programming dis24 tribution, and relevant related industries—
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1 (A) are informing viewers regarding their

2 options to utilize blocking technology; and

3 (B) encouraging the development of blocking

4 technologies.

5 (c) GAO AUDIT.—

6 (1) AUDIT REQUIRED.—No later than 18 months

7 after the date of the enactment of this Act, the Comp8 troller General shall submit to Congress an evaluation

9 of—

10 (A) the proliferation of new and existing

11 blocking technology;

12 (B) the accessibility of information to em13 power viewing choices; and

14 (C) the consumer satisfaction with informa15 tion and technological solutions.

16 (2) CONTENTS OF EVALUATION.—The evaluation

17 shall—

18 (A) describe the blocking technology avail19 able to viewers including the costs thereof; and

20 (B) assess the extent of consumer knowledge

21 and attitudes toward available blocking tech22 nologies;

23 (3) describe steps taken by broadcast, cable, sat24 ellite, syndication, and other video programming dis25 tribution services to inform the public and promote
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1 the availability of viewer empowerment technologies,

2 devices, and techniques;

3 (4) evaluate the degree to which viewer

4 empowerment technology is being utilized;

5 (5) assess consumer satisfaction with techno6 logical options; and

7 (6) evaluate consumer demand for information

8 and technological solutions.

9 SEC. 305. PARENTAL CHOICE IN TELEVISION PROGRAM10 MING.

11 (a) FINDINGS.—The Congress makes the following

12 findings:

13 (1) Television influences children’s perception of

14 the values and behavior that are common and accept15 able in society.

16 (2) Television station operators, cable television

17 system operators, and video programmers should fol18 low practices in connection with video programming

19 that take into consideration that television broadcast

20 and cable programming has established a uniquely

21 pervasive presence in the lives of American children.

22 (3) The average American child is exposed to 25

23 hours of television each week and some children are

24 exposed to as much as 11 hours of television a day.
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1 (4) Studies have shown that children exposed to

2 violent video programming at a young age have a

3 higher tendency for violent and aggressive behavior

4 later in life than children not so exposed, and that

5 children exposed to violent video programming are

6 prone to assume that acts of violence are acceptable

7 behavior.

8 (5) Children in the United States are, on aver9 age, exposed to an estimated 8,000 murders and

10 100,000 acts of violence on television by the time the

11 child completes elementary school.

12 (6) Studies indicate that children are affected by

13 the pervasiveness and casual treatment of sexual ma14 terial on television, eroding the ability of parents to

15 develop responsible attitudes and behavior in their

16 children.

17 (7) Parents express grave concern over violent

18 and sexual video programming and strongly support

19 technology that would give them greater control to

20 block video programming in the home that they con21 sider harmful to their children.

22 (8) There is a compelling governmental interest

23 in empowering parents to limit the negative influ24 ences of video programming that is harmful to chil25 dren.
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1 (9) Providing parents with timely information

2 about the nature of upcoming video programming

3 and with the technological tools that allow them eas4 ily to block violent, sexual, or other programming

5 that they believe harmful to their children is the least

6 restrictive and most narrowly tailored means of

7 achieving that compelling governmental interest.

8 (b) ESTABLISHMENT OF TELEVISION RATING CODE.—

9 Section 303 of the Act (47 U.S.C. 303) is amended by add10 ing at the end the following:

11 ‘‘(v) Prescribe—

12 ‘‘(1) on the basis of recommendations from an

13 advisory committee established by the Commission

14 that is composed of parents, television broadcasters,

15 television programming producers, cable operators,

16 appropriate public interest groups, and other inter17 ested individuals from the private sector and that is

18 fairly balanced in terms of political affiliation, the

19 points of view represented, and the functions to be

20 performed by the committee, guidelines and rec21 ommended procedures for the identification and rat22 ing of video programming that contains sexual, vio23 lent, or other indecent material about which parents

24 should be informed before it is displayed to children,

25 provided that nothing in this paragraph shall be con-
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1 strued to authorize any rating of video programming

2 on the basis of its political or religious content; and

3 ‘‘(2) with respect to any video programming that

4 has been rated (whether or not in accordance with the

5 guidelines and recommendations prescribed under

6 paragraph (1)), rules requiring distributors of such

7 video programming to transmit such rating to permit

8 parents to block the display of video programming

9 that they have determined is inappropriate for their

10 children.’’.

11 (c) REQUIREMENT FOR MANUFACTURE OF TELE12 VISIONS THAT BLOCK PROGRAMS.—Section 303 of the Act,

13 as amended by subsection (a), is further amended by adding

14 at the end the following:

15 ‘‘(w) Require, in the case of apparatus designed to re16 ceive television signals that are manufactured in the United

17 States or imported for use in the United States and that

18 have a picture screen 13 inches or greater in size (measured

19 diagonally), that such apparatus be equipped with circuitry

20 designed to enable viewers to block display of all programs

21 with a common rating, except as otherwise permitted by

22 regulations pursuant to section 330(c)(4).’’.

23 (d) SHIPPING OR IMPORTING OF TELEVISIONS THAT

24 BLOCK PROGRAMS.—
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1 (1) REGULATIONS.—Section 330 of the Commu2 nications Act of 1934 (47 U.S.C. 330) is amended—

3 (A) by redesignating subsection (c) as sub4 section (d); and

5 (B) by adding after subsection (b) the fol6 lowing new subsection (c):

7 ‘‘(c)(1) Except as provided in paragraph (2), no per8 son shall ship in interstate commerce, manufacture, assem9 ble, or import from any foreign country into the United

10 States any apparatus described in section 303(w) of this

11 Act except in accordance with rules prescribed by the Com12 mission pursuant to the authority granted by that section.

13 ‘‘(2) This subsection shall not apply to carriers trans14 porting apparatus referred to in paragraph (1) without

15 trading it.

16 ‘‘(3) The rules prescribed by the Commission under

17 this subsection shall provide for the oversight by the Com18 mission of the adoption of standards by industry for block19 ing technology. Such rules shall require that all such appa20 ratus be able to receive the rating signals which have been

21 transmitted by way of line 21 of the vertical blanking inter22 val and which conform to the signal and blocking specifica23 tions established by industry under the supervision of the

24 Commission.
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1 ‘‘(4) As new video technology is developed, the Commis2 sion shall take such action as the Commission determines

3 appropriate to ensure that blocking service continues to be

4 available to consumers. If the Commission determines that

5 an alternative blocking technology exists that—

6 ‘‘(A) enables parents to block programming based

7 on identifying programs without ratings,

8 ‘‘(B) is available to consumers at a cost which

9 is comparable to the cost of technology that allows

10 parents to block programming based on common rat11 ings, and

12 ‘‘(C) will allow parents to block a broad range

13 of programs on a multichannel system as effectively

14 and as easily as technology that allows parents to

15 block programming based on common ratings,

16 the Commission shall amend the rules prescribed pursuant

17 to section 303(w) to require that the apparatus described

18 in such section be equipped with either the blocking tech19 nology described in such section or the alternative blocking

20 technology described in this paragraph.’’.

21 (2) CONFORMING AMENDMENT.—Section 330(d)

22 of such Act, as redesignated by subsection (a)(1), is

23 amended by striking ‘‘section 303(s), and section

24 303(u)’’ and inserting in lieu thereof ‘‘and sections

25 303(s), 303(u), and 303(w)’’.
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1 (e) APPLICABILITY AND EFFECTIVE DATES.—

2 (1) APPLICABILITY OF RATING PROVISION.—The

3 amendment made by subsection (b) of this section

4 shall take effect 1 year after the date of enactment of

5 this Act, but only if the Commission determines, in

6 consultation with appropriate public interest groups

7 and interested individuals from the private sector,

8 that distributors of video programming have not, by

9 such date—

10 (A) established voluntary rules for rating

11 video programming that contains sexual, violent,

12 or other indecent material about which parents

13 should be informed before it is displayed to chil14 dren, and such rules are acceptable to the Com15 mission; and

16 (B) agreed voluntarily to broadcast signals

17 that contain ratings of such programming.

18 (2) EFFECTIVE DATE OF MANUFACTURING PROVI19 SION.—In prescribing regulations to implement the

20 amendment made by subsection (c), the Federal Com21 munications Commission shall, after consultation

22 with the television manufacturing industry, specify

23 the effective date for the applicability of the require24 ment to the apparatus covered by such amendment,
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1 which date shall not be less than one year after the

2 date of the enactment of this Act.

3 SEC. 306. TERM OF LICENSES.

4 Section 307(c) of the Act (47 U.S.C. 307(c)) is amend5 ed to read as follows:

6 ‘‘(c) TERMS OF LICENSES.—

7 ‘‘(1) INITIAL AND RENEWAL LICENSES.—Each li8 cense granted for the operation of a broadcasting sta9 tion shall be for a term of not to exceed seven years.

10 Upon application therefor, a renewal of such license

11 may be granted from time to time for a term of not

12 to exceed seven years from the date of expiration of

13 the preceding license, if the Commission finds that

14 public interest, convenience, and necessity would be

15 served thereby. Consistent with the foregoing provi16 sions of this subsection, the Commission may by rule

17 prescribe the period or periods for which licenses shall

18 be granted and renewed for particular classes of sta19 tions, but the Commission may not adopt or follow

20 any rule which would preclude it, in any case involv21 ing a station of a particular class, from granting or

22 renewing a license for a shorter period than that pre23 scribed for stations of such class if, in its judgment,

24 public interest, convenience, or necessity would be

25 served by such action.
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1 ‘‘(2) MATERIALS IN APPLICATION.—In order to

2 expedite action on applications for renewal of broad3 casting station licenses and in order to avoid needless

4 expense to applicants for such renewals, the Commis5 sion shall not require any such applicant to file any

6 information which previously has been furnished to

7 the Commission or which is not directly material to

8 the considerations that affect the granting or denial

9 of such application, but the Commission may require

10 any new or additional facts it deems necessary to

11 make its findings.

12 ‘‘(3) CONTINUATION PENDING DECISION.—Pend13 ing any hearing and final decision on such an appli14 cation and the disposition of any petition for rehear15 ing pursuant to section 405, the Commission shall

16 continue such license in effect.’’.

17 SEC. 307. BROADCAST LICENSE RENEWAL PROCEDURES.

18 (a) AMENDMENT.—Section 309 of the Act (47 U.S.C.

19 309) is amended by adding at the end thereof the following

20 new subsection:

21 ‘‘(k) BROADCAST STATION RENEWAL PROCEDURES.—

22 ‘‘(1) STANDARDS FOR RENEWAL.—If the licensee

23 of a broadcast station submits an application to the

24 Commission for renewal of such license, the Commis25 sion shall grant the application if it finds, with re-
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1 spect to that station, during the preceding term of its

2 license—

3 ‘‘(A) the station has served the public inter4 est, convenience, and necessity;

5 ‘‘(B) there have been no serious violations

6 by the licensee of this Act or the rules and regu7 lations of the Commission; and

8 ‘‘(C) there have been no other violations by

9 the licensee of this Act or the rules and regula10 tions of the Commission which, taken together,

11 would constitute a pattern of abuse.

12 ‘‘(2) CONSEQUENCE OF FAILURE TO MEET

13 STANDARD.—If any licensee of a broadcast station

14 fails to meet the requirements of this subsection, the

15 Commission may deny the application for renewal in

16 accordance with paragraph (3), or grant such appli17 cation on terms and conditions as are appropriate,

18 including renewal for a term less than the maximum

19 otherwise permitted.

20 ‘‘(3) STANDARDS FOR DENIAL.—If the Commis21 sion determines, after notice and opportunity for a

22 hearing as provided in subsection (e), that a licensee

23 has failed to meet the requirements specified in para24 graph (1) and that no mitigating factors justify the

25 imposition of lesser sanctions, the Commission shall—
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1 ‘‘(A) issue an order denying the renewal ap2 plication filed by such licensee under section 308;

3 and

4 ‘‘(B) only thereafter accept and consider

5 such applications for a construction permit as

6 may be filed under section 308 specifying the

7 channel or broadcasting facilities of the former

8 licensee.

9 ‘‘(4) COMPETITOR CONSIDERATION PROHIB10 ITED.—In making the determinations specified in

11 paragraph (1) or (2), the Commission shall not con12 sider whether the public interest, convenience, and ne13 cessity might be served by the grant of a license to a

14 person other than the renewal applicant.’’.

15 (b) CONFORMING AMENDMENT.—Section 309(d) of the

16 Act (47 U.S.C. 309(d)) is amended by inserting after ‘‘with

17 subsection (a)’’ each place such term appears the following:

18 ‘‘(or subsection (k) in the case of renewal of any broadcast

19 station license)’’.

20 (c) EFFECTIVE DATE.—The amendments made by this

21 section shall apply to any application for renewal pending

22 or filed on or after the date of enactment of this Act.
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1 SEC. 308. EXCLUSIVE FEDERAL JURISDICTION OVER DI2 RECT BROADCAST SATELLITE SERVICE.

3 Section 303 of the Act (47 U.S.C. 303) is amended by

4 adding at the end thereof the following new subsection:

5 ‘‘(v) Have exclusive jurisdiction over the regulation of

6 the direct broadcast satellite service.’’.

7 SEC. 309. AUTOMATED SHIP DISTRESS AND SAFETY SYS8 TEMS.

9 Notwithstanding any provision of the Communica10 tions Act of 1934 or any other provision of law or regula11 tion, a ship documented under the laws of the United States

12 operating in accordance with the Global Maritime Distress

13 and Safety System provisions of the Safety of Life at Sea

14 Convention shall not be required to be equipped with a

15 radio telegraphy station operated by one or more radio offi16 cers or operators. This section shall take effect for each vessel

17 upon a determination by the United States Coast Guard

18 that such vessel has the equipment required to implement

19 the Global Maritime Distress and Safety System installed

20 and operating in good working condition.

21 SEC. 310. RESTRICTIONS ON OVER-THE-AIR RECEPTION DE22 VICES.

23 Within 180 days after the enactment of this Act, the

24 Commission shall, pursuant to section 303, promulgate reg25 ulations to prohibit restrictions that inhibit a viewer’s abil26 ity to receive video programming services through signal
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1 receiving devices designed for off-the-air reception of tele2 vision broadcast signals or direct broadcast satellite serv3 ices.

4 SEC. 311. DBS SIGNAL SECURITY.

5 Section 705(e)(4) of the Act (47 U.S.C. 605(e)) is

6 amended by inserting after ‘‘satellite cable programming’’

7 the following: ‘‘or programming of a licensee in the direct

8 broadcast satellite service’’.

9 SEC. 312. DELEGATION OF EQUIPMENT TESTING AND CER10 TIFICATION TO PRIVATE LABORATORIES.

11 Section 302 of the Act (47 U.S.C. 302) is amended by

12 adding at the end the following:

13 ‘‘(e) USE OF PRIVATE ORGANIZATIONS FOR TESTING

14 AND CERTIFICATION.—The Commission may—

15 ‘‘(1) authorize the use of private organizations

16 for testing and certifying the compliance of devices or

17 home electronic equipment and systems with regula18 tions promulgated under this section;

19 ‘‘(2) accept as prima facie evidence of such com20 pliance the certification by any such organization;

21 and

22 ‘‘(3) establish such qualifications and standards

23 as it deems appropriate for such private organiza24 tions, testing, and certification.’’.
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1 TITLE IV—EFFECT ON OTHER

2 LAWS

3 SEC. 401. RELATIONSHIP TO OTHER LAWS.

4 (a) MODIFICATION OF FINAL JUDGMENT.—This Act

5 and the amendments made by title I of this Act shall super6 sede only the following sections of the Modification of Final

7 Judgment:

8 (1) Section II(C) of the Modification of Final

9 Judgment, relating to deadline for procedures for

10 equal access compliance.

11 (2) Section II(D) of the Modification of Final

12 Judgment, relating to line of business restrictions.

13 (3) Section VIII(A) of the Modification of Final

14 Judgment, relating to manufacturing restrictions.

15 (4) Section VIII(C) of the Modification of Final

16 Judgment, relating to standard for entry into the

17 interexchange market.

18 (5) Section VIII(D) of the Modification of Final

19 Judgment, relating to prohibition on entry into elec20 tronic publishing.

21 (6) Section VIII(H) of the Modification of Final

22 Judgment, relating to debt ratios at the time of trans23 fer.
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1 (7) Section VIII(J) of the Modification of Final

2 Judgment, relating to prohibition on implementation

3 of the plan of reorganization before court approval.

4 (b) ANTITRUST LAWS.—Nothing in this Act or in the

5 amendments made by this Act shall be construed to modify,

6 impair, or supersede the applicability of any of the anti7 trust laws.

8 (c) FEDERAL, STATE, AND LOCAL LAW.—(1) Parts II

9 and III of title II of the Communications Act of 1934 shall

10 not be construed to modify, impair, or supersede Federal,

11 State, or local law unless expressly so provided in such part.

12 (2) STATE TAX SAVINGS PROVISION.—Notwithstand13 ing paragraph (1), nothing in this Act or the amendments

14 made by this Act shall be construed to modify, impair, or

15 supersede, or authorize the modification, impairment, or

16 supersession of, any State or local law pertaining to tax17 ation, except as provided in sections 243(e) and 622 of the

18 Communications Act of 1934 and section 402 of this Act.

19 (d) APPLICATION TO OTHER ACTION.—This Act shall

20 supersede the final judgment entered December 21, 1984

21 and as restated January 11, 1985, in the action styled

22 United States v. GTE Corp., Civil Action No. 83–1298, in

23 the United States District Court for the District of Colum24 bia, and any judgment or order with respect to such action

25 entered on or after December 21, 1984, and such final judg-
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1 ment shall not be enforced with respect to conduct occurring

2 after the date of the enactment of this Act.

3 (e) INAPPLICABILITY OF FINAL JUDGMENT TO WIRE4 LESS SUCCESSORS.—No person shall be considered to be an

5 affiliate, a successor, or an assign of a Bell operating com6 pany under section III of the Modification of Final Judg7 ment by reason of having acquired wireless exchange assets

8 or operations previously owned by a Bell operating com9 pany or an affiliate of a Bell operating company.

10 (f) ANTITRUST LAWS.—As used in this section, the

11 term ‘‘antitrust laws’’ has the meaning given it in sub12 section (a) of the first section of the Clayton Act (15 U.S.C.

13 12(a)), except that such term includes the Act of June 19,

14 1936 (49 Stat. 1526; 15 U.S.C. 13 et seq.), commonly

15 known as the Robinson Patman Act, and section 5 of the

16 Federal Trade Commission Act (15 U.S.C. 45) to the extent

17 that such section 5 applies to unfair methods of competi18 tion.

19 (g) ADDITIONAL DEFINITIONS.—As used in this sec20 tion, the terms ‘‘Modification of Final Judgment’’ and ‘‘Bell

21 operating company’’ have the same meanings provided such

22 terms in section 3 of the Communications Act of 1934.
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1 SEC. 402. PREEMPTION OF LOCAL TAXATION WITH RESPECT

2 TO DBS SERVICE.

3 (a) PREEMPTION.—A provider of direct-to-home sat4 ellite service shall be exempt from the collection or remit5 tance, or both, of any tax or fee imposed by any local taxing

6 jurisdiction with respect to the provision of direct-to-home

7 satellite service. Nothing in this section shall be construed

8 to exempt from collection or remittance any tax or fee on

9 the sale of equipment.

10 (b) DEFINITIONS.—For the purposes of this section—

11 (1) DIRECT-TO-HOME SATELLITE SERVICE.—The

12 term ‘‘direct-to-home satellite service’’ means the

13 transmission or broadcasting by satellite of program14 ming directly to the subscribers’ premises without the

15 use of ground receiving or distribution equipment, ex16 cept at the subscribers’ premises or in the uplink

17 process to the satellite.

18 (2) PROVIDER OF DIRECT-TO-HOME SATELLITE

19 SERVICE.—For purposes of this section, a ‘‘provider of

20 direct-to-home satellite service’’ means a person who

21 transmits, broadcasts, sells, or distributes direct-to22 home satellite service.

23 (3) LOCAL TAXING JURISDICTION.—The term

24 ‘‘local taxing jurisdiction’’ means any municipality,

25 city, county, township, parish, transportation dis26 trict, or assessment jurisdiction, or any other local ju-
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1 risdiction in the territorial jurisdiction of the United

2 States with the authority to impose a tax or fee, but

3 does not include a State.

4 (4) STATE.—The term ‘‘State’’ means any of the

5 several States, the District of Columbia, or any terri6 tory or possession of the United States.

7 (5) TAX OR FEE.—The terms ‘‘tax’’ and ‘‘fee’’

8 mean any local sales tax, local use tax, local intangi9 ble tax, local income tax, business license tax, utility

10 tax, privilege tax, gross receipts tax, excise tax, fran11 chise fees, local telecommunications tax, or any other

12 tax, license, or fee that is imposed for the privilege of

13 doing business, regulating, or raising revenue for a

14 local taxing jurisdiction.

15 (c) PRESERVATION OF STATE AUTHORITY.—This sec16 tion shall not be construed to prevent taxation of a provider

17 of direct-to-home satellite service by a State or to prevent

18 a local taxing jurisdiction from receiving revenue derived

19 from a tax or fee imposed and collected by a State.

20 SEC. 403. PROTECTION OF MINORS AND CLARIFICATION OF

21 CURRENT LAWS REGARDING COMMUNICA22 TION OF OBSCENE AND INDECENT MATE23 RIALS THROUGH THE USE OF COMPUTERS.

24 (a) PROTECTION OF MINORS.—
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1 (1) GENERALLY.—Section 1465 of title 18, Unit2 ed States Code, is amended by adding at the end the

3 following:

4 ‘‘Whoever intentionally communicates by computer, in

5 or affecting interstate or foreign commerce, to any person

6 the communicator believes has not attained the age of 18

7 years, any material that, in context, depicts or describes,

8 in terms patently offensive as measured by contemporary

9 community standards, sexual or excretory activities or or10 gans, or attempts to do so, shall be fined under this title

11 or imprisoned not more than five years, or both.’’.

12 (2) CONFORMING AMENDMENTS RELATING TO

13 FORFEITURE.—

14 (A) Section 1467(a)(1) of title 18, United

15 States Code, is amended by inserting ‘‘commu16 nicated,’’ after ‘‘transported,’’.

17 (B) Section 1467 of title 18, United States

18 Code, is amended in subsection (a)(1), by strik19 ing ‘‘obscene’’.

20 (C) Section 1469 of title 18, United States

21 Code, is amended by inserting ‘‘communicated,’’

22 after ‘‘transported,’’ each place it appears.

23 (b) CLARIFICATION OF CURRENT LAWS REGARDING

24 COMMUNICATION OF OBSCENE MATERIALS THROUGH THE

25 USE OF COMPUTERS.—
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1 (1) IMPORTATION OR TRANSPORTATION.—Section

2 1462 of title 18, United States Code, is amended—

3 (A) in the first undesignated paragraph, by

4 inserting ‘‘(including by computer) after ‘‘there5 of’’; and

6 (B) in the second undesignated para7 graph—

8 (i) by inserting ‘‘or receives,’’ after

9 ‘‘takes’’;

10 (ii) by inserting ‘‘, or by computer,’’

11 after ‘‘common carrier’’; and

12 (iii) by inserting ‘‘or importation’’

13 after ‘‘carriage’’.

14 (2) TRANSPORTATION FOR PURPOSES OF SALE

15 OR DISTRIBUTION.—The first undesignated paragraph

16 of section 1465 of title 18, United States Code, is

17 amended—

18 (A) by striking ‘‘transports in’’ and insert19 ing ‘‘transports or travels in, or uses a facility

20 or means of,’’;

21 (B) by inserting ‘‘(including a computer in

22 or affecting such commerce)’’ after ‘‘foreign com23 merce’’ the first place it appears; and

24 (C) by striking ‘‘, or knowingly travels in’’

25 and all that follows through ‘‘obscene material in
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1 interstate or foreign commerce,’’ and inserting

2 ‘‘of’’.

3 TITLE V—DEFINITIONS

4 SEC. 501. DEFINITIONS.

5 (a) ADDITIONAL DEFINITIONS.—Section 3 of the Act

6 (47 U.S.C. 153) is amended—

7 (1) in subsection (r)—

8 (A) by inserting ‘‘(A)’’ after ‘‘means’’; and

9 (B) by inserting before the period at the end

10 the following: ‘‘, or (B) service provided through

11 a system of switches, transmission equipment, or

12 other facilities (or combination thereof) by which

13 a subscriber can originate and terminate a tele14 communications service within a State but

15 which does not result in the subscriber incurring

16 a telephone toll charge’’; and

17 (2) by adding at the end thereof the following:

18 ‘‘(35) AFFILIATE.—The term ‘affiliate’, when

19 used in relation to any person or entity, means an20 other person or entity who owns or controls, is owned

21 or controlled by, or is under common ownership or

22 control with, such person or entity.

23 ‘‘(36) BELL OPERATING COMPANY.—The term

24 ‘Bell operating company’ means—
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1 ‘‘(A) Bell Telephone Company of Nevada,

2 Illinois Bell Telephone Company, Indiana Bell

3 Telephone Company, Incorporated, Michigan

4 Bell Telephone Company, New England Tele5 phone and Telegraph Company, New Jersey Bell

6 Telephone Company, New York Telephone Com7 pany, U S West Communications Company,

8 South Central Bell Telephone Company, South9 ern Bell Telephone and Telegraph Company,

10 Southwestern Bell Telephone Company, The Bell

11 Telephone Company of Pennsylvania, The Chesa12 peake and Potomac Telephone Company, The

13 Chesapeake and Potomac Telephone Company of

14 Maryland, The Chesapeake and Potomac Tele15 phone Company of Virginia, The Chesapeake

16 and Potomac Telephone Company of West Vir17 ginia, The Diamond State Telephone Company,

18 The Ohio Bell Telephone Company, The Pacific

19 Telephone and Telegraph Company, or Wiscon20 sin Telephone Company;

21 ‘‘(B) any successor or assign of any such

22 company that provides telephone exchange serv23 ice.
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1 ‘‘(37) CABLE SYSTEM.—The term ‘cable system’

2 has the meaning given such term in section 602(7) of

3 this Act.

4 ‘‘(38) CUSTOMER PREMISES EQUIPMENT.—The

5 term ‘customer premises equipment’ means equipment

6 employed on the premises of a person (other than a

7 carrier) to originate, route, or terminate tele8 communications.

9 ‘‘(39) DIALING PARITY.—The term ‘dialing par10 ity’ means that a person that is not an affiliated en11 terprise of a local exchange carrier is able to provide

12 telecommunications services in such a manner that

13 customers have the ability to route automatically,

14 without the use of any access code, their telecommuni15 cations to the telecommunications services provider of

16 the customer’s designation from among 2 or more tele17 communications services providers (including such

18 local exchange carrier).

19 ‘‘(40) EXCHANGE ACCESS.—The term ‘exchange

20 access’ means the offering of telephone exchange serv21 ices or facilities for the purpose of the origination or

22 termination of interLATA services.

23 ‘‘(41) INFORMATION SERVICE.—The term ‘infor24 mation service’ means the offering of a capability for

25 generating, acquiring, storing, transforming, process-
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1 ing, retrieving, utilizing, or making available infor2 mation via telecommunications, and includes elec3 tronic publishing, but does not include any use of any

4 such capability for the management, control, or oper5 ation of a telecommunications system or the manage6 ment of a telecommunications service. For purposes of

7 section 242, such term shall not include the provision

8 of video programming directly to subscribers.

9 ‘‘(42) INTERLATA SERVICE.—The term

10 ‘interLATA service’ means telecommunications be11 tween a point located in a local access and transport

12 area and a point located outside such area.

13 ‘‘(43) LOCAL ACCESS AND TRANSPORT AREA.—

14 The term ‘local access and transport area’ or ‘LATA’

15 means a contiguous geographic area—

16 ‘‘(A) established by a Bell operating com17 pany such that no exchange area includes points

18 within more than 1 metropolitan statistical

19 area, consolidated metropolitan statistical area,

20 or State, except as expressly permitted under the

21 Modification of Final Judgment before the date

22 of the enactment of this paragraph; or

23 ‘‘(B) established or modified by a Bell oper24 ating company after the date of enactment of
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1 this paragraph and approved by the Commis2 sion.

3 ‘‘(44) LOCAL EXCHANGE CARRIER.—The term

4 ‘local exchange carrier’ means any person that is en5 gaged in the provision of telephone exchange service or

6 exchange access. Such term does not include a person

7 insofar as such person is engaged in the provision of

8 a commercial mobile service under section 332(c), ex9 cept to the extent that the Commission finds that such

10 service as provided by such person in a State is a re11 placement for a substantial portion of the wireline

12 telephone exchange service within such State.

13 ‘‘(45) MODIFICATION OF FINAL JUDGMENT.—The

14 term ‘Modification of Final Judgment’ means the

15 order entered August 24, 1982, in the antitrust action

16 styled United States v. Western Electric, Civil Action

17 No. 82–0192, in the United States District Court for

18 the District of Columbia, and includes any judgment

19 or order with respect to such action entered on or

20 after August 24, 1982.

21 ‘‘(46) NUMBER PORTABILITY.—The term ‘number

22 portability’ means the ability of users of telecommuni23 cations services to retain existing telecommunications

24 numbers without impairment of quality, reliability,

25 or convenience when changing from one provider of
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1 telecommunications services to another, as long as

2 such user continues to be located within the area

3 served by the same central office of the carrier from

4 which the user is changing.

5 ‘‘(47) RURAL TELEPHONE COMPANY.—The term

6 ‘rural telephone company’ means a local exchange

7 carrier operating entity to the extent that such en8 tity—

9 ‘‘(A) provides common carrier service to

10 any local exchange carrier study area that does

11 not include either—

12 ‘‘(i) any incorporated place of 10,000

13 inhabitants or more, or any part thereof,

14 based on the most recent available popu15 lation statistics of the Bureau of the Census;

16 or

17 ‘‘(ii) any territory, incorporated or un18 incorporated, included in an urbanized

19 area, as defined by the Bureau of the Cen20 sus as of August 10, 1993;

21 ‘‘(B) provides telephone exchange service,

22 including telephone exchange access service, to

23 fewer than 50,000 access lines;
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1 ‘‘(C) provides telephone exchange service to

2 any local exchange carrier study area with fewer

3 than 100,000 access lines; or

4 ‘‘(D) has less than 15 percent of its access

5 lines in communities of more than 50,000 on the

6 date of enactment of this paragraph.

7 ‘‘(48) TELECOMMUNICATIONS.—The term ‘tele8 communications’ means the transmission, between or

9 among points specified by the subscriber, of informa10 tion of the subscriber’s choosing, without change in

11 the form or content of the information as sent and re12 ceived, by means of an electromagnetic transmission

13 medium, including all instrumentalities, facilities,

14 apparatus, and services (including the collection, stor15 age, forwarding, switching, and delivery of such in16 formation) essential to such transmission.

17 ‘‘(49) TELECOMMUNICATIONS EQUIPMENT.—The

18 term ‘telecommunications equipment’ means equip19 ment, other than customer premises equipment, used

20 by a carrier to provide telecommunications services,

21 and includes software integral to such equipment (in22 cluding upgrades).

23 ‘‘(50) TELECOMMUNICATIONS SERVICE.—The

24 term ‘telecommunications service’ means the offering,

25 on a common carrier basis, of telecommunications fa-
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1 cilities, or of telecommunications by means of such fa2 cilities. Such term does not include an information

3 service.’’.

4 (b) STYLISTIC CONSISTENCY.—Section 3 of the Act (47

5 U.S.C. 153) is amended—

6 (1) in subsections (e) and (n), by redesignating

7 clauses (1), (2) and (3), as clauses (A), (B), and (C),

8 respectively;

9 (2) in subsection (w), by redesignating para10 graphs (1) through (5) as subparagraphs (A) through

11 (E), respectively;

12 (3) in subsections (y) and (z), by redesignating

13 paragraphs (1) and (2) as subparagraphs (A) and

14 (B), respectively;

15 (4) by redesignating subsections (a) through (ff)

16 as paragraphs (1) through (32);

17 (5) by indenting such paragraphs 2 em spaces;

18 (6) by inserting after the designation of each

19 such paragraph—

20 (A) a heading, in a form consistent with the

21 form of the heading of this subsection, consisting

22 of the term defined by such paragraph, or the

23 first term so defined if such paragraph defines

24 more than one term; and

25 (B) the words ‘‘The term’’;
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1 (7) by changing the first letter of each defined

2 term in such paragraphs from a capital to a lower

3 case letter (except for ‘‘United States’’, ‘‘State’’,

4 ‘‘State commission’’, and ‘‘Great Lakes Agreement’’);

5 and

6 (8) by reordering such paragraphs and the addi7 tional paragraphs added by subsection (a) in alpha8 betical order based on the headings of such para9 graphs and renumbering such paragraphs as so reor10 dered.

11 (c) CONFORMING AMENDMENTS.—The Act is amend12 ed—

13 (1) in section 225(a)(1), by striking ‘‘section

14 3(h)’’ and inserting ‘‘section 3’’;

15 (2) in section 332(d), by striking ‘‘section 3(n)’’

16 each place it appears and inserting ‘‘section 3’’; and

17 (3) in sections 621(d)(3), 636(d), and 637(a)(2),

18 by striking ‘‘section 3(v)’’ and inserting ‘‘section 3’’.

19 TITLE VI—SMALL BUSINESS

20 COMPLAINT PROCEDURE

21 SEC. 601. COMPLAINT PROCEDURE.

22 (a) PROCEDURE REQUIRED.—The Federal Commu23 nications Commission shall establish procedures for the re24 ceipt and review of complaints concerning violations of the

25 Communications Act of 1934, and the rules and regulations
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1 thereunder, that are likely to result, or have resulted, as a

2 result of the violation, in material financial harm to a pro3 vider of telemessaging service, or other small business en4 gaged in providing an information service or other tele5 communications service. Such procedures shall be estab6 lished within 120 days after the date of enactment of this

7 Act.

8 (b) DEADLINES FOR PROCEDURES; SANCTIONS.—The

9 procedures under this section shall ensure that the Commis10 sion will make a final determination with respect to any

11 such complaint within 120 days after receipt of the com12 plaint. If the complaint contains an appropriate showing

13 that the alleged violation occurred, as determined by the

14 Commission in accordance with such regulations, the Com15 mission shall, within 60 days after receipt of the complaint,

16 order the common carrier and its affiliates to cease engag17 ing in such violation pending such final determination. In

18 addition, the Commission may exercise its authority to im19 pose other penalties or sanctions, to the extent otherwise

20 provided by law.

21 (c) DEFINITION.—For purposes of this section, a small

22 business shall be any business entity that, along with any

23 affiliate or subsidiary, has fewer than 300 employees.

Amend the title so as to read: ‘‘An Act to promote competition and reduce regulation in order to secure lower prices
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and higher quality services for American telecommunications

consumers and encourage the rapid deployment of new telecommunications technologies.’’.

Attest:

Clerk.
104TH CONGRESS

1ST SESSION S. 652

AMENDMENTS