Union Calendar No. 285
105TH CONGRESS
2D SESSION
H. R. 1872
[Report No. 105–494]
A BILL
To amend the Communications Satellite Act of
1962 to promote competition and privatization in
satellite communications, and for other purposes.
APRIL 27, 1998
Reported with an amendment, committed to the Commit-
tee of the Whole House on the State of the Union, and
ordered to be printed
IB
Union Calendar No. 285
105TH CONGRESS
2D SESSION
H. R. 1872
[Report No. 105–494]
To amend the Communications Satellite Act of 1962 to promote competition
and privatization in satellite communications, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JUNE 12, 1997
Mr. BLILEY (for himself and Mr. MARKEY) introduced the following bill;
which was referred to the Committee on Commerce
APRIL 27, 1998
Additional sponsors: Mr. KLUG, Mr. DEUTSCH, Mr. UPTON, Mr. BURR of
North Carolina, Mr. GANSKE, Mr. SHAYS, Mr. WHITE, Ms. ESHOO, Mr.
CANADY of Florida, Mr. GILLMOR, Mr. PAXON, Mr. COX of California,
Mr. ADAM SMITH of Washington, Mr. FOLEY, Mr. DAVIS of Florida, Mr.
LARGENT, Mr. NORWOOD, Ms. MCCARTHY of Missouri, Mr. DEAL of
Georgia, Mr. ENGEL, Mr. HASTINGS of Washington, Mr. GREENWOOD,
Mr. STRICKLAND, Mr. DAVIS of Virginia, Mr. PALLONE, Mr. LINDER,
Mr. DICKS, Mr. GREEN, Mr. RUSH, Mr. HASTERT, Mr. STEARNS, Mr.
METCALF, Mr. LAZIO of New York, Mr. BILBRAY, Mr. CRAPO, Mr. MAN-
TON, Mr. SHIMKUS, Mr. PICKERING, Mr. MCINTOSH, Mrs. THURMAN,
Ms. DELAURO, Mr. MCDERMOTT, Mr. LATOURETTE, Mr. FRELING-
HUYSEN, Mr. COBURN, Mr. SANFORD, Ms. DUNN, Mrs. CUBIN, Mr. BILI-
RAKIS, Mr. WHITFIELD, Mr. PASTOR, and Mr. NEAL of Massachusetts
APRIL 27, 1998
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
[For text of introduced bill, see copy of bill as introduced on June 12, 1997]
A BILL
To amend the Communications Satellite Act of 1962 to pro-
mote competition and privatization in satellite commu-
nications, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Communications Sat-
ellite Competition and Privatization Act of 1998’’.
SEC. 2. PURPOSE.
It is the purpose of this Act to promote a fully competi-
tive global market for satellite communication services for
the benefit of consumers and providers of satellite services
and equipment by fully privatizing the intergovernmental
satellite organizations, INTELSAT and Inmarsat.
SEC. 3. REVISION OF COMMUNICATIONS SATELLITE ACT OF
1962.
The Communications Satellite Act of 1962 (47 U.S.C.
101) is amended by adding at the end the following new
title:
‘‘TITLE 
VI—COMMUNICATIONS
COMPETITION AND PRIVAT-
IZATION
‘‘Subtitle A—Actions To Ensure
Procompetitive Privatization
‘‘SEC. 601. FEDERAL COMMUNICATIONS COMMISSION LI-
CENSING.
‘‘(a) LICENSING FOR SEPARATED ENTITIES.—
‘‘(1) COMPETITION TEST.—The Commission may
not issue a license or construction permit to any sep-
arated entity, or renew or permit the assignment or
use of any such license or permit, or authorize the use
by any entity subject to United States jurisdiction of
any space segment owned, leased, or operated by any
separated entity, unless the Commission determines
that such issuance, renewal, assignment, or use will
not harm competition in the telecommunications
market of the United States. If the Commission does
not make such a determination, it shall deny or re-
voke authority to use space segment owned, leased, or
operated by the separated entity to provide services to,
from, or within the United States.
‘‘(2) CRITERIA
FOR
COMPETITION
TEST.—In
making the determination required by paragraph (1),
the Commission shall use the licensing criteria in sec-
tions 621 and 623, and shall not make such a deter-
mination unless the Commission determines that the
privatization of any separated entity is consistent
with such criteria.
‘‘(b) LICENSING
FOR INTELSAT, INMARSAT, AND
SUCCESSOR ENTITIES.—
‘‘(1) COMPETITION TEST.—The Commission shall
substantially limit, deny, or revoke the authority for
any entity subject to United States jurisdiction to use
space 
segment 
owned, 
leased, 
or 
operated 
by
INTELSAT or Inmarsat or any successor entities to
provide non-core services to, from, or within the
United States, unless the Commission determines—
‘‘(A) after January 1, 2002, in the case of
INTELSAT and its successor entities, that
INTELSAT and any successor entities have been
privatized in a manner that will not harm com-
petition in the telecommunications markets of
the United States; or
‘‘(B) after January 1, 2001, in the case of
Inmarsat 
and 
its 
successor 
entities, 
that
Inmarsat and any successor entities have been
privatized in a manner that will not harm com-
petition in the telecommunications markets of
the United States.
‘‘(2) CRITERIA
FOR
COMPETITION
TEST.—In
making the determination required by paragraph (1),
the Commission shall use the licensing criteria in sec-
tions 621, 622, and 624, and shall not make such a
determination unless the Commission determines that
such privatization is consistent with such criteria.
‘‘(3) 
CLARIFICATION: 
COMPETITIVE
SAFE-
GUARDS.—In making its licensing decisions under
this subsection, the Commission shall consider whether
users of non-core services provided by INTELSAT or
Inmarsat or successor or separated entities are able to
obtain non-core services from providers offering serv-
ices other than through INTELSAT or Inmarsat or
successor or separated entities, at competitive rates,
terms, or conditions. Such consideration shall also in-
clude whether such licensing decisions would require
users to replace equipment at substantial costs prior
to the termination of its design life. In making its li-
censing decisions, the Commission shall also consider
whether competitive alternatives in individual mar-
kets do not exist because they have been foreclosed due
to anticompetitive actions undertaken by or resulting
from the INTELSAT or Inmarsat systems. Such li-
censing decisions shall be made in a manner which
facilitates achieving the purposes and goals in this
title and shall be subject to notice and comment.
‘‘(c) ADDITIONAL CONSIDERATIONS
IN DETERMINA-
TIONS.—In making its determinations and licensing deci-
sions under subsections (a) and (b), the Commission shall
take into consideration the United States obligations and
commitments for satellite services under the Fourth Protocol
to the General Agreement on Trade in Services.
‘‘(d) INDEPENDENT FACILITIES COMPETITION.—Noth-
ing in this section shall be construed as precluding COM-
SAT from investing in or owning satellites or other facili-
ties independent from INTELSAT and Inmarsat, and suc-
cessor or separated entities, or from providing services
through reselling capacity over the facilities of satellite sys-
tems independent from INTELSAT and Inmarsat, and suc-
cessor or separated entities. This subsection shall not be con-
strued as restricting the types of contracts which can be exe-
cuted or services which may be provided by COMSAT over
the independent satellites or facilities described in this sub-
section.
‘‘SEC. 602. INTELSAT OR INMARSAT ORBITAL LOCATIONS.
‘‘(a) REQUIRED ACTIONS.—Unless, in a proceeding
under section 601(b), the Commission determines that
INTELSAT or Inmarsat have been privatized in a manner
that will not harm competition, then—
‘‘(1) the President shall oppose, and the Commis-
sion shall not assist, any registration for new orbital
locations for INTELSAT or Inmarsat—
‘‘(A) with respect to INTELSAT, after Jan-
uary 1, 2002, and
‘‘(B) with respect to Inmarsat, after Janu-
ary 1, 2001, and
‘‘(2) the President and Commission shall, con-
sistent with the deadlines in paragraph (1), take all
other necessary measures to preclude procurement,
registration, development, or use of new satellites
which would provide non-core services.
‘‘(b) EXCEPTION.—
‘‘(1) REPLACEMENT
AND
PREVIOUSLY
CON-
TRACTED
SATELLITES.—Subsection (a) shall not
apply to—
‘‘(A) orbital locations for replacement sat-
ellites (as described in section 622(2)(B)), and
‘‘(B) orbital locations for satellites that are
contracted for as of March 25, 1998, if such sat-
ellites do not provide additional services.
‘‘(2) LIMITATION
ON
EXCEPTION.—Paragraph
(1) is available only with respect to satellites designed
to provide services solely in the C and Ku, for
INTELSAT, and L, for Inmarsat, bands.
‘‘SEC. 603. ADDITIONAL SERVICES AUTHORIZED.
‘‘(a) SERVICES AUTHORIZED DURING CONTINUED
PROGRESS.—
‘‘(1) CONTINUED
AUTHORIZATION.—The Com-
mission may issue an authorization, license, or per-
mit to, or renew the license or permit of, any provider
of services using INTELSAT or Inmarsat space seg-
ment, or authorize the use of such space segment, for
additional services (including additional applications
of existing services) or additional areas of business,
subject to the requirements of this section.
‘‘(2) ADDITIONAL SERVICES PERMITTED UNDER
NEW CONTRACTS UNLESS PROGRESS FAILS.—If the
Commission makes a finding under subsection (b)
that conditions required by such subsection have not
been attained, the Commission may not, pursuant to
paragraph (1), permit such additional services to be
provided directly or indirectly under new contracts
for the use of INTELSAT or Inmarsat space segment,
unless and until the Commission subsequently makes
a finding under such subsection that such conditions
have been attained.
‘‘(3) PREVENTION
OF
EVASION.—The Commis-
sion shall, by rule, prescribe means reasonably de-
signed to prevent evasions of the limitations con-
tained in paragraph (2) by customers who did not
use specific additional services as of the date of the
Commission’s most recent finding under subsection
(b) that the conditions of such subsection have not
been obtained.
‘‘(b) REQUIREMENTS FOR ANNUAL FINDINGS.—
‘‘(1) GENERAL
REQUIREMENTS.—The findings
required under this subsection shall be made, after no-
tice and comment, on or before January 1 of 1999,
2000, 2001, and 2002. The Commission shall find
that the conditions required by this subsection have
been attained only if the Commission finds that—
‘‘(A) substantial and material progress has
been made during the preceding period at a rate
and manner that is probable to result in achiev-
ing pro-competitive privatizations in accordance
with the requirements of this title; and
‘‘(B) neither INTELSAT nor Inmarsat are
hindering competitors’ or potential competitors’
access to the satellite services marketplace.
‘‘(2) FIRST FINDING.—In making the finding re-
quired to be made on or before January 1, 1999, the
Commission shall not find that the conditions re-
quired by this subsection have been attained unless
the Commission finds that—