154
ing joint venture will include the geo-
graphic area where the Bell operating
company provides basic telephone serv-
ice, or network operations personnel
whose responsibilities at the separated
affiliate or electronic publishing joint
venture would require dealing directly
with the Bell operating company, any
person who was employed by the Bell op-
erating company during the year preced-
ing their date of hire, provided that this
requirement shall not apply to persons
subject to a collective bargaining agree-
ment that gives such persons rights to be
employed by a separated affiliate or elec-
tronic publishing joint venture of the Bell
operating company;
‘‘(6) not provide any wireline tele-
phone exchange service in any telephone
exchange area where a Bell operating
company with which it is under common
ownership or control provides basic tele-
phone exchange service except on a re-
sale basis;
155
‘‘(7) not use the name, trademarks, or
service marks of an existing Bell operat-
ing company except for names, trade-
marks, or service marks that are or were
used in common with the entity that
owns or controls the Bell operating com-
pany;
‘‘(8) 
have 
performed 
annually 
by
March 31, or any other date prescribed
by the Commission, a compliance review
which—
‘‘(A) must be conducted by an
independent entity which is subject
to professional, legal, and ethical obli-
gations for the purpose of determin-
ing compliance during the preceding
calendar year with any provision of
this section that imposes a require-
ment on such separated affiliate or
electronic publishing joint venture;
and
‘‘(B) must be maintained by the
separated affiliate for a period of 5
years subject to review by any lawful
authority;
156
‘‘(9) within 90 days of receiving a re-
view described in paragraph (8), file a re-
port of such exceptions and any correc-
tive action with the Commission and
allow any person to inspect and copy
such report subject to reasonable safe-
guards to protect any proprietary infor-
mation contained in such report from
being used for purposes other than to en-
force or pursue remedies under this sec-
tion.
‘‘(c) BELL OPERATING COMPANY REQUIRE-
MENTS.—A Bell operating company under
common ownership or control with a sepa-
rated affiliate or electronic publishing joint
venture shall—
‘‘(1) not provide a separated affiliate
any facilities, services, or basic telephone
service information unless it makes such
facilities, services, or information avail-
able to unaffiliated entities upon request
and on the same terms and conditions;
‘‘(2) carry out transactions with a sep-
arated affiliate in a manner equivalent to
the manner that unrelated parties would
157
carry out independent transactions and
not based upon the affiliation;
‘‘(3) carry out transactions with a sep-
arated affiliate, which involve the trans-
fer of personnel, assets, or anything of
value, pursuant to written contracts or
tariffs that are filed with the Commission
and made publicly available;
‘‘(4) carry out transactions with a sep-
arated affiliate in a manner that is
auditable in accordance with generally
accepted accounting principles;
‘‘(5) value any assets that are trans-
ferred to a separated affiliate at the
greater of net book cost or fair market
value;
‘‘(6) value any assets that are trans-
ferred to it by its separated affiliate at
the lesser of net book cost or fair market
value;
‘‘(7) except for—
‘‘(A) instances where Commission
or State regulations permit in-arrears
payment for tariffed telecommuni-
cations services; or
158
‘‘(B) the investment by an affiliate
of dividends or profits derived from a
Bell operating company,
not provide debt or equity financing di-
rectly or indirectly to a separated affili-
ate;
‘‘(8) comply fully with all applicable
Commission and State cost allocation and
other accounting rules;
‘‘(9) 
have 
performed 
annually 
by
March 31, or any other date prescribed
by the Commission, a compliance review
which—
‘‘(A) must be conducted by an
independent entity which is subject
to professional, legal, and ethical obli-
gations for the purpose of determin-
ing compliance during the preceding
calendar year with any provision of
this section that imposes a require-
ment on such Bell operating com-
pany; and
‘‘(B) must be maintained by the
Bell operating company for a period
159
of 5 years subject to review by any
lawful authority;
‘‘(10) within 90 days of receiving a re-
view described in paragraph (9), file a re-
port of such exceptions and any correc-
tive action with the Commission and
allow any person to inspect and copy
such report subject to reasonable safe-
guards to protect any proprietary infor-
mation contained in such report from
being used for purposes other than to en-
force or pursue remedies under this sec-
tion;
‘‘(11) if it provides facilities or serv-
ices for telecommunication, transmission,
billing and collection, or physical colloca-
tion to any electronic publisher, includ-
ing a separated affiliate, for use with or
in connection with the provision of elec-
tronic publishing that is disseminated by
means of such Bell operating company’s
or any of its affiliates’ basic telephone
service, provide to all other electronic
publishers the same type of facilities and
services on request, on the same terms
160
and conditions or as required by the
Commission or a State, and unbundled
and individually tariffed to the smallest
extent that is technically feasible and
economically reasonable to provide;
‘‘(12) provide network access and
interconnections 
for 
basic 
telephone
service to electronic publishers at any
technically feasible and economically rea-
sonable point within the Bell operating
company’s network and at just and rea-
sonable rates that are tariffed (so long as
rates for such services are subject to reg-
ulation) and that are not higher on a per-
unit basis than those charged for such
services to any other electronic publisher
or any separated affiliate engaged in
electronic publishing;
‘‘(13) if prices for network access and
interconnection for basic telephone serv-
ice are no longer subject to regulation,
provide electronic publishers such serv-
ices on the same terms and conditions as
a separated affiliate receives such serv-
ices;
161
‘‘(14) if any basic telephone service
used by electronic publishers ceases to
require a tariff, provide electronic pub-
lishers with such service on the same
terms and conditions as a separated affil-
iate receives such service;
‘‘(15) provide reasonable advance no-
tification at the same time and on the
same terms to all affected electronic pub-
lishers of information if such information
is within any one or more of the follow-
ing categories:
‘‘(A) such information is nec-
essary for the transmission or routing
of information by an interconnected
electronic publisher;
‘‘(B) such information is nec-
essary to ensure the interoperability
of an electronic publisher’s and the
Bell operating company’s networks;
or
‘‘(C) such information concerns
changes in basic telephone service
network design and technical stand-
162
ards which may affect the provision
of electronic publishing;
‘‘(16) not directly or indirectly pro-
vide anything of monetary value to a sep-
arated affiliate unless in exchange for
consideration at least equal to the great-
er of its net book cost or fair market
value, except the investment by an affili-
ate of dividends or profits derived from a
Bell operating company;
‘‘(17) not discriminate in the presen-
tation or provision of any gateway for
electronic publishing services or any
electronic directory of information serv-
ices, which is provided over such Bell op-
erating company’s basic telephone serv-
ice;
‘‘(18) have no directors, officers or
employees in common with a separated
affiliate;
‘‘(19) not own any property in com-
mon with a separated affiliate;
‘‘(20) not perform hiring or training of
personnel performed on behalf of a sepa-
rated affiliate;
163
‘‘(21) not perform the purchasing, in-
stallation or maintenance of equipment
on behalf of a separated affiliate, except
for telephone service that it provides
under tariff or contract subject to the
provisions of this section; and
‘‘(22) not perform research and devel-
opment on behalf of a separated affiliate.
‘‘(d) CUSTOMER PROPRIETARY NETWORK IN-
FORMATION.—A Bell operating company or any
affiliate shall not provide to any electronic
publisher, including a separated affiliate or
electronic publishing joint venture, customer
proprietary network information for use with
or in connection with the provision of elec-
tronic publishing that is disseminated by
means of such Bell operating company’s or
any of its affiliates’ basic telephone service
that is not made available by the Bell operat-
ing company or affiliate to all electronic pub-
lishers on the same terms and conditions.
‘‘(e) COMPLIANCE
WITH
SAFEGUARDS.—A
Bell operating company, affiliate or its sepa-
rated affiliate is prohibited from acting in
concert with another Bell operating company
164
or any entity in order to knowingly and will-
fully violate or evade the requirements of this
section.
‘‘(f) TELEPHONE OPERATING COMPANY DIVI-
DENDS.—Nothing in this section shall prohibit
an affiliate from investing dividends derived
from a Bell operating company in its sepa-
rated affiliate and subsections (i) and (j) of
this section shall not apply to any such invest-
ment.
‘‘(g) JOINT
MARKETING, ETC.—Except as
provided in subsection (h)—
‘‘(1) a Bell operating company shall
not carry out any promotion, marketing,
sales, or advertising for or in conjunction
with a separated affiliate.
‘‘(2) A Bell operating company shall
not carry out any promotion, marketing,
sales, or advertising for or in conjunction
with an affiliate that is related to the pro-
vision of electronic publishing.
‘‘(h) PERMISSIBLE JOINT ACTIVITIES.—
‘‘(1) JOINT TELEMARKETING.—A Bell op-
erating company may provide inbound
telemarketing or referral services related
165
to the provision of electronic publishing
for a separated affiliate, electronic pub-
lishing joint venture, affiliate, or unaffili-
ated electronic publisher, provided that
if such services are provided to a sepa-
rated affiliate, electronic publishing joint
venture, or affiliate, such services shall
be made available to all electronic pub-
lishers on request, on nondiscriminatory
terms, at compensatory prices, and sub-
ject to regulations of the Commission to
ensure that the Bell operating company’s
method of providing telemarketing or re-
ferral and its price structure do not com-
petitively disadvantage any electronic
publishers regardless of size, including
those which do not use the Bell operating
company’s telemarketing services.
‘‘(2) TEAMING
ARRANGEMENTS.—A Bell
operating company may engage in non-
discriminatory teaming or business ar-
rangements to engage in electronic pub-
lishing with any separated affiliate or
with any other electronic publisher pro-
vided that the Bell operating company
166
only provides facilities, services, and
basic telephone service information as
authorized by this section and provided
that the Bell operating company does not
own such teaming or business arrange-
ment.
‘‘(3) ELECTRONIC PUBLISHING JOINT VEN-
TURES.—A Bell operating company or af-
filiate may participate on a nonexclusive
basis in electronic publishing joint ven-
tures with entities that are not any Bell
operating company, affiliate, or sepa-
rated affiliate to provide electronic pub-
lishing services, provided that the Bell
operating company or affiliate has not
more than a 50 percent direct or indirect
equity interest (or the equivalent thereof)
or the right to more than 50 percent of
the gross revenues under a revenue shar-
ing or royalty agreement in any elec-
tronic publishing joint venture. Officers
and employees of a Bell operating com-
pany or affiliate participating in an elec-
tronic publishing joint venture may not
have more than 50 percent of the voting
167
control over the electronic publishing
joint venture. In the case of joint ven-
tures with small, local electronic publish-
ers, the Commission for good cause
shown may authorize the Bell operating
company or affiliate to have a larger eq-
uity interest, revenue share, or voting
control but not to exceed 80 percent. A
Bell operating company participating in
an electronic publishing joint venture
may provide promotion, marketing, sales,
or advertising personnel and services to
such joint venture.
‘‘(i) TRANSACTIONS RELATED TO THE PROVI-
SION
OF ELECTRONIC PUBLISHING BETWEEN
A
TELEPHONE OPERATING COMPANY AND ANY AF-
FILIATE.—
‘‘(1) Any provision of facilities, serv-
ices or basic telephone service informa-
tion or any transfer of assets, personnel,
or anything of commercial or competitive
value from a Bell operating company to
any affiliate related to the provision of
electronic publishing shall be—
168
‘‘(A) recorded in the books and
records of each entity;
‘‘(B) auditable in accordance with
generally accepted accounting prin-
ciples; and
‘‘(C) pursuant to written contracts
or tariffs filed with the Commission
or a State and made publicly avail-
able.
‘‘(2) Any transfer of assets directly re-
lated to the provision of electronic pub-
lishing from a Bell operating company to
an affiliate shall be valued at the greater
of net book cost or fair market value. Any
transfer of assets related to the provision
of electronic publishing from an affiliate
to the Bell operating company shall be
valued at the lesser of net book cost or
fair market value.
‘‘(3) A Bell operating company shall
not provide an affiliate any facilities,
services, or basic telephone service infor-
mation related to the provision of elec-
tronic publishing, which such affiliate
then directly or indirectly provides to a
169
separated affiliate, and which is not
made available to unaffiliated companies
on the same terms and conditions.
‘‘(j) TRANSACTIONS RELATED TO THE PROVI-
SION OF ELECTRONIC PUBLISHING BETWEEN AN
AFFILIATE AND A SEPARATED AFFILIATE.—
‘‘(1) Any facilities, services, or basic
telephone service information provided
or any assets, personnel, or anything of
commercial or competitive value trans-
ferred, from a Bell operating company to
any affiliate as described in subsection (i)
and then provided or transferred to a
separated affiliate shall be—
‘‘(A) recorded in the books and
records of each entity;
‘‘(B) auditable in accordance with
generally accepted accounting prin-
ciples; and
‘‘(C) pursuant to written contracts
or tariffs filed with the Commission
or a State and made publicly avail-
able.
‘‘(2) Any transfer of assets directly re-
lated to the provision of electronic pub-
170
lishing from a Bell operating company to
any affiliate as described in subsection (i)
and then transferred to a separated affili-
ate shall be valued at the greater of net
book cost or fair market value. Any trans-
fer of assets related to the provision of
electronic publishing from a separated
affiliate to any affiliate and then trans-
ferred to the Bell operating company as
described in subsection (i) shall be val-
ued at the lesser of net book cost or fair
market value.
‘‘(3) An affiliate shall not provide a
separated affiliate any facilities, services,
or basic telephone service information re-
lated to the provision of electronic pub-
lishing, which were provided to such af-
filiate directly or indirectly by a Bell op-
erating company, and which is not made
available to unaffiliated companies on
the same terms and conditions.
‘‘(k) OTHER ELECTRONIC PUBLISHERS.—Ex-
cept as provided in subsection (h)(3)—
‘‘(1) A Bell operating company shall
not have any officers, employees, prop-
171
erty, or facilities in common with any en-
tity whose principal business is publish-
ing of which a part is electronic publish-
ing.
‘‘(2) No officer or employee of a Bell
operating company shall serve as a direc-
tor of any entity whose principal busi-
ness is publishing of which a part is elec-
tronic publishing.
‘‘(3) For the purposes of paragraphs
(1) and (2), a Bell operating company or
an affiliate that owns an electronic pub-
lishing joint venture shall not be deemed
to be engaged in the electronic publish-
ing business solely because of such own-
ership.
‘‘(4) A Bell operating company shall
not carry out—
‘‘(A) any marketing or sales for
any entity that engages in electronic
publishing; or
‘‘(B) any hiring of personnel, pur-
chasing, or production,
for any entity that engages in electronic
publishing.
172
‘‘(5) The Bell operating company shall
not provide any facilities, services, or
basic telephone service information to
any entity that engages in electronic pub-
lishing, for use with or in connection
with the provision of electronic publish-
ing that is disseminated by means of such
Bell operating company’s or any of its af-
filiates’ basic telephone service, unless
equivalent facilities, services, or informa-
tion are made available on equivalent
terms and conditions to all.
‘‘(l) TRANSITION.—Any electronic publish-
ing service being offered to the public by a
Bell operating company or affiliate on the
date of enactment of this section shall have
one year from such date of enactment to com-
ply with the requirements of this section.
‘‘(m) SUNSET.—The provisions of this sec-
tion shall cease to apply to a Bell operating
company or its affiliate or separated affiliate
in any telephone exchange area on June 30,
2000.
‘‘(n) PRIVATE RIGHT OF ACTION.—
173
‘‘(1) Any person claiming that any act
or practice of any Bell operating com-
pany, affiliate, or separated affiliate con-
stitutes a violation of this section may
file a complaint with the Commission or
bring suit as provided in section 207 of
the Communications Act of 1934 (47
U.S.C. 207), and such Bell operating com-
pany, affiliate, or separated affiliate shall
be liable as provided in section 206 of the
Communications Act of 1934, (47 U.S.C.
207): Provided, however, That damages
may not be awarded for a violation that
is discovered by a compliance review as
required by subsection (b)(8) or (c)(9) of
this section and corrected within 90 days.
‘‘(2) In addition to the provisions of
paragraph (1), any person claiming that
any act or practice of any Bell operating
company, affiliate, or separated affiliate
constitutes a violation of this section may
make application to the Commission for
an order to cease and desist such viola-
tion or may make application in any dis-
trict court of the United States of com-
174
petent jurisdiction for an order enjoining
such acts or practices or for an order
compelling compliance with such re-
quirement.
‘‘(o) ANTITRUST LAWS.—Nothing in this sec-
tion shall be construed to modify, impair, or
supersede the applicability of any of the anti-
trust laws (including title I of the Antitrust
and Communications Reform Act of 1994).
‘‘(p) DEFINITIONS.—As used in this sec-
tion—
‘‘(1) The term ‘affiliate’ means any en-
tity that, directly or indirectly, owns or
controls, is owned or controlled by, or is
under common ownership or control
with, a Bell operating company. Such
term shall not include a separated affili-
ate.
‘‘(2) The term ‘basic telephone service’
means any wireline telephone exchange
service, or a wireline telephone exchange
service facility, provided by a Bell operat-
ing company in a telephone exchange
area, except
175
‘‘(A) a competitive wireline tele-
phone exchange service provided in a
telephone exchange area where an-
other entity provides a wireline tele-
phone exchange service that was pro-
vided on January 1, 1984, and
‘‘(B) wireless telephone exchange
service provided by an affiliate that
is required by the Commission to be a
corporate entity separate from the
Bell operating company.
‘‘(3) The term ‘basic telephone service
information’ means network and cus-
tomer information of a Bell operating
company and other information acquired
by a Bell operating company as a result
of its engaging in the provision of basic
telephone service.
‘‘(4) The term ‘control’ has the mean-
ing that it has in 17 C.F.R. 240.12b–2, the
regulations promulgated by the Securi-
ties and Exchange Commission pursuant
to the Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) or any successor provi-
sion to such section.
176
‘‘(5) The term ‘customer proprietary
network information’ means—
‘‘(A) information which—
‘‘(i) relates to the quantity,
technical configuration, type, des-
tination, and amount of use of
telephone exchange service or
interexchange telephone service
subscribed to by any customer of
a Bell operating company, and
‘‘(ii) is available to the Bell op-
erating company by virtue of the
telephone company-customer re-
lationship; and
‘‘(B) information contained in the
bills for telephone exchange service
or interexchange telephone service
received by a customer of a Bell oper-
ating company.
‘‘(6)(A) The term ‘electronic publish-
ing’ means the dissemination, provision,
publication, or sale to an unaffiliated en-
tity or person, using a Bell operating
company’s basic telephone service, of—
‘‘(i) news or entertainment;
177
‘‘(ii) 
business, 
financial, 
legal,
consumer, or credit material;
‘‘(iii) editorials;
‘‘(iv) columns;
‘‘(v) sports reporting;
‘‘(vi) features;
‘‘(vii) advertising;
‘‘(viii) photos or images;
‘‘(ix) archival or research mate-
rial;
‘‘(x) 
legal 
notices 
or 
public
records;
‘‘(xi) scientific, educational, in-
structional, 
technical, 
professional,
trade, or other literary materials; or
‘‘(xii) other like or similar infor-
mation.
‘‘(B) The term ‘electronic publishing’
shall not include the following network
services:
‘‘(i) Information access as that
term is defined by the Modification of
Final Judgment.
‘‘(ii) The transmission of informa-
tion as a common carrier.
178
‘‘(iii) The transmission of informa-
tion as part of a gateway to an infor-
mation service that does not involve
the generation or alteration of the
content 
of 
information, 
including
data 
transmission, 
address 
trans-
lation, protocol conversion, billing
management, introductory informa-
tion content, and navigational sys-
tems that enable users to access elec-
tronic publishing services, which do
not affect the presentation of such
electronic 
publishing 
services 
to
users.
‘‘(iv) Voice storage and retrieval
services, including voice messaging
and electronic mail services.
‘‘(v) Level 2 gateway services as
those services are defined by the
Commission’s 
Second 
Report 
and
Order, Recommendation to Congress
and Second Further Notice of Pro-
posed Rulemaking in CC Docket No.
87–266 dated August 14, 1992.