USTR OFFERS TO BROADEN ACCESS TO TELECOM SERVICES

CompTel Exec. Vp.-Gen. Counsel Carol Bischoff supported USTR’s initiative and said she hoped it would encourage similar procompetitive offers in telecommunications services: “The liberalization of services will no doubt open up billions of dollars worth of opportunities for CompTel’s members and their trading partners around the world.” The Information Technology Industry Council (ITI) applauded the USTR for “maintaining momentum in the WTO” leading to the conclusion of the Doha Round negotiations set for 2005. “Services are a key factor in facilitating trade in information technology and the USTR is to be commended for its continued efforts to advance the ambitious agenda the Bush administration has set,” ITI Pres. Rhett Dawson said.

The key principles of the regulatory framework for the basic telecom services include: (1) Prevention of anticompetitive practices in telecom. The USTR said appropriate measures should be maintained to prevent major suppliers from engaging in or continuing anticompetitive practices. It said such practices should include in particular engaging in anticompetitive cross-subsidization, using information obtained from competitors with anticompetitive results and not making available to other services suppliers on a timely basis technical information about essential facilities and commercially relevant information that was necessary for them to provide services.

(2) Interconnection with a major supplier would be assured at any technically feasible point in the network. Such interconnection would be provided under nondiscriminatory terms, conditions and rates and of the same quality as provided for its own similar services. The interconnection also should be provided in a timely fashion on transparent and reasonable terms and conditions that were sufficiently unbundled so that the supplier wouldn’t need to pay for the network components or facilities that weren’t required for the provided service. The interconnection also should be provided on request at additional points, subject to charges reflecting the cost of construction of necessary additional facilities. The USTR said procedures applicable for interconnection to a major supplier would be made available publicly. It said it should be assured that a major supplier would make publicly available either its interconnection agreements or a reference interconnection offer. A service supplier requesting interconnection with a major supplier would have recourse either at any time or after a reasonable period of time that had been made publicly known to an independent domestic body.

(3) Any member would have the right to define the kind of universal service obligation it wanted to maintain. Such obligations won’t be regarded as anticompetitive per se, provided they were administered in a transparent, nondiscriminatory and competitively neutral manner and weren’t more burdensome than necessary for the kind of universal service defined by the member. (4) All the licensing criteria and the period of time required to reach a decision on an application for a license and the terms and condition of individual licenses would be made publicly available, where a license was required. The reasons for the denial of a license would be made known to the applicant on request.

(5) The regulatory body should be separate from, and not accountable to, any supplier of basic telecom services. The decisions of and the procedures used by regulators should be impartial with respect to all market participants. (6) All procedures for the allocation and use of scarce resources, including frequencies, numbers and rights-of-way, would be carried out in an objective, timely and transparent manner. The current state of allocated frequency bands would be made publicly available, but detailed identification of frequencies allocated for specific govt. users wouldn’t be required.

Countries must focus their efforts on the liberalization of IT and e-commerce related services to fully realize their potential, ITI said. It said given the increasing trend for technology users to buy IT solutions over the Internet rather than purchase products to create their own solutions, “liberalization in this area now has even greater importance.” The ITI said it hoped 2 key objectives would be achieved in the services negotiations: (1) Full market access and national treatment in computer and related services from countries that hadn’t made commitments or that had made commitments with limitations. (2) Ensuring that evolving IT services, including those delivered electronically, were covered by GATS commitments for computer and related services without creating barriers for these services.

The U.S. Coalition of Service Industries (CSI), which actively participated in the GATS and in the advocacy effort leading to the 1997 WTO Basic Telecom & Financial Services Agreement, called the offer “important because it is a substantial improvement over existing U.S. commitments in the GATS.” CSI Chmn. Dean O'Hare urged other countries to join the U.S. in making initial offers reflecting their current levels of liberalization and then to seek to improve their WTO commitments through the bargaining that would be launched by the offers process.

The USTR market access offer on services to WTO members, which was submitted in line with the deadline for offers, followed the WTO’s Ministerial Meeting in Doha, Qatar, in Nov. 2001, and was the result of a detailed consultation process with state and local govts., and regulatory authorities in the U.S. Zoellick said the offer complemented the U.S. request last summer that other WTO members open their markets to U.S. services, which “often face high barriers and impediments to doing business.” “We continue to press for these barriers to be lowered so that American workers and businesses are treated fairly, and today’s offer moves this process forward,” he said.