U.S. Trade Representative (USTR) office outlined reform recommendations to Japan designed to further deregulate that country’s economy, including telecom. Document was presented by Deputy USTR Jon Huntsman to Japanese Deputy Foreign Minister Shotaro Oshima in informal meeting of trade ministers in Singapore over weekend, USTR office in Washington said. Recommendations are part of Regulatory Reform & Competition Policy Initiative President Bush and Japanese Prime Minister Junichiro Koizumi began in June under U.S.-Japan Economic Partnership. Report said Japan had goal of building one of most advanced telecom network infrastructures by 2005. “Attempting to achieve this goal while at the same time maintaining and deepening competition, however, poses formidable policy challenges, given the susceptibility of advanced services to monopolization,” report said. USTR said U.S. urged Japan “to complete the process of instituting and implementing a procompetitive regime, rather than settle for something less.” Recommendations for Japan’s telecom sector included: (1) Eliminating or reducing filing requirements for competitive carriers, particularly wholesale carriers. (2) Creating independent telecom regulatory authority and eliminating govt. ownership of service providers. (3) Strengthening dominant carrier regulations to prevent “competitive abuses” by NTT and wireless carrier NTT DoCoMo. (4) Cutting high interconnection rates and reforming inefficient rate structure. (5) Continuing to facilitate access to infrastructure that competitors need to reach subscribers. (6) Evaluating whether “a universal service subsidy program is necessary and ensure that any proposed subsidies are competitively neutral.” (7) Analyzing how access to Internet services can be increased “not through regulation of international links but through enhanced competition in domestic bottlenecks.” On information technologies, recommendations included: (1) Ensuring transparency in new privacy laws and “promot[ing] a high level of consumer confidence in doing business online through the development of private sector self-regulatory initiatives.” (2) Ensuring that laws governing electronic transactions are technology- neutral and that U.S. and Japanese approaches for Internet- based payment systems “facilitate online transactions.” (3) Working jointly on e-education initiatives that complement Japan’s plans to expand PC-based Internet use in Japan’s education system. (4) Coordinating issues of international cooperation to protect integrity of Internet. Report also includes specific recommendations for Japan’s Ministry of Public Management, Home Affairs, Posts & Telecommunications. They include obtaining needed legal authority from Diet to forbear “from applying legacy regulations where competition in a market or market segment permits user interests to be achieved without government intervention and where risks of competitive abuses or minimal.” U.S. also suggested substituting Internet-based public notifications for tariff filing requirements to replace services offered to general public.
U.S. Trade Representative Robert Zoellick stressed role of U.S. high-tech sector in free trade efforts in Washington speech Mon. He met with trade ministers from Argentina, Brazil, Paraguay and Uruguay to discuss international and regional trade liberalization efforts. U.S. held similar consultations Mon. in Managua, Nicaragua, with Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua. Ministerial meeting in Washington focused on new round of global trade negotiations at World Trade Organization meeting in Nov. and continued progress on Free Trade Area of the Americas. Among U.S. negotiating objectives in high-tech sector, Zoellick said, is need to “open up the basic and value-added telecom services because these provide the backbone for a technology network environment.” He said U.S. was “seeking the most liberalized environment we can for e-commerce. We are examining the services performed along the e-commerce value chain, whether basic and enhanced telecom, distribution, computers, advertising, express delivery or financial, because any break in that chain creates inefficiencies and infringes on the business and consumer benefits of e-commerce.” Zoellick also stressed need to improve standard for intellectual property and enforcement and to give technology companies help in “clearing technical and regulatory hurdles” in areas such as product approval and local content regulations.
In letters sent Thurs. to State Dept. and U.S. Trade Representative, CompTel urged opening of formal round of World Trade Organization (WTO) negotiations at ministerial in Nov. with goal of liberalizing telecom trade. Letters also urged Administration to support regional and bilateral liberalization efforts such as Free Trade Area of Americas and free trade agreement negotiations with Chile and Singapore. CompTel Gen. Counsel Carol Ann Bischoff said “only the initiation of a formal round of WTO negotiations will provide the necessary momentum to bring negotiations to a successful conclusion.”
Paul Margie, senior commerce counsel for Sen. Rockefeller, joins Comr. Copps’ staff as spectrum and international legal advisor… Jon Huntsman, ex-vp, Huntsman Corp., confirmed as U.S. Trade Representative… Bob Reid, vp-production, named senior vp- gen. mgr., Discovery Health Channel… Changes at Trilogy: Deborah Ingram vp-professional services; Joe Gatto vp- professional services operations, reporting to Ingram… Shafiq Chaudhuri joins Taylor McKenzie as vp-technical services… Fred Schultz, ex-Leitch Technology, named vp-news automation, Sundance Digital.
Thomas Navin named deputy chief-policy division, FCC Wireless Telecommunications Bureau… Betsy Frank, exec. vp-research and planning, MTV Networks, elected a dir. of Cable & Telecom Assn. for Mktg., replacing Nicole Browning… Changes at Wilmer, Cutler & Pickering: Charlene Barshefsky, ex-U.S. Trade Representative, named senior international partner; Robert Novick, ex-gen. counsel, U.S. Trade Representative’s office, named partner, practicing in Washington office… Karen Spacek, ex-Harrah’s Entertainment, named senior vp-systems-communications, Gaylord Entertainment.
U.S. Trade Representative Robert Zoellick said Thurs. that U.S. won’t renew 1999 procurement agreement with Japan that covers procurement practices of Nippon Telegraph & Telephone (NTT). Instead of renewing pact, which expires July 1, Zoellick said U.S. would “actively monitor NTT’s procurement practices and purchases from U.S. suppliers” through information supplied by U.S. industry. He said U.S. sales to NTT under past agreements had had competitive effects on both Japan’s telecom market and U.S. telecom equipment suppliers. But he stopped short of declaring victory. “More remains to be done to achieve a fully open NTT market,” Zoellick said. “We believe the best way to pursue this goal is to continue to closely monitor NTT purchases and purchasing practices in coordination with U.S. industry.” As result, American Electronics Assn. (AeA) and Telecommunications Industry Assn. (TIA) said Thurs. they planned to “vigorously” monitor NTT procurement practices. AeA and TIA said they were undertaking quarterly tracking of NTT’s total equipment purchases. “This recognition of the agreement’s expiration date does not signify overall industry satisfaction with NTT’s procurement practices or with the share of non-Japanese origin procurement in NTT’s total equipment purchases,” groups said. Since 1999 agreement was signed, groups said U.S. suppliers had seen sales increase in certain product areas, but “the overall results do not equal the level of increased sales U.S. companies have seen for their equipment in the Japanese private market or other regions of the world.” NTT, which in 1999 was restructured into 2 local companies and one long distance provider, still is 46% owned by Japanese govt., its largest shareowner. U.S. and Japan had reached 2-year equipment supply agreement that year, which was one in series of renewals of previous agreements, after U.S. negotiators had persuaded Japan to allow continued govt. monitoring of streamlined NTT procurement practices. Pact covered NTT purchases from foreign telecom equipment manufacturers.
Settlement rates agreement reached late Wed. by Telefonos de Mexico (Telmex) and WorldCom provoked immediate opposition Thurs. from AT&T, which said proposed rates still were “well above” 4 cent per min. cost of providing service. AT&T, contending proposal didn’t conform with Mexico’s World Trade Organization (WTO) commitments, said it planned to oppose proposal at FCC. But deal appeared to have forestalled, for now, U.S. Trade Representative’s taking action by deadline today (Fri.) for carrying concerns over Mexico’s telecom market any further at WTO. USTR official told us U.S. still wasn’t backing down from earlier filing at WTO that would mark first step toward dispute resolution panel if govt. chose to take that route.
U.S. Trade Representative (USTR) released reports Mon. that outline Bush Administration’s trade expansion priorities for 2001, including enforcement commitments for U.S. trade agreements. Among reports are: (1) Super 301, which reviews trade expansion priorities and focuses on unfair trade practices affecting U.S. exports. (2) Special 301, which covers U.S. enforcement of intellectual property rights. (3) Title 7, which covers discrimination in foreign govt. procurement practices. USTR official told reporters in background briefing Mon. that reports cited “significant” concerns with level of intellectual property protection in 51 countries that are trading partners of U.S., including Argentina, Costa Rico, European Union, India, Israel, Korea, Russia, Taiwan, Uruguay. “Enforcement must remain a key priority,” U.S. Trade Representative Robert Zoellick said. “We must step up our efforts to monitor compliance with our trade agreements and insist on performance by our trading partners. This administration will not hesitate to use the full power of U.S. and international law to do so.” USTR reports reiterated concerns in report released earlier this year on Mexico’s compliance with telecom market-opening commitments under World Trade Organization obligations. Reports Mon. said Mexico had made progress in areas such as ensuring that competitors obtained local interconnection from incumbent Telmex but “has not yet addressed the key issue of international traffic or enforced its dominant carrier rules.” Report that identifies Administration’s trade expansion priorities also outlines barriers to e-commerce. As example, report cites policy in Israel “that would disadvantage U.S. companies wishing to offer Internet access services over the cable platform and would favor the state-owned telecommunications company.” State-owned carrier, Bezeq, has been licensed to enter high-speed Internet access sector without incurring govt. licensing fees. Report said legislation had been introduced in Israel that would require cable companies seeking to compete in that market to pay licensing fees. “The United States is seriously concerned that regulatory favoritism undermines the investment environment in Internet services in Israel,” report said.
Among names surfacing with increasing frequency as possible Bush White House nominee to head NTIA is Level 3 Vp-Govt. Relations Tricia Paoletta. Paoletta was majority telecom counsel for House Commerce Committee when it was chaired by then Rep. Thomas Bliley (R-Va.). She also is former dir.-telecom trade policy in Office of U.S. Trade Representative and earlier spent 5 years at FCC, including as senior legal adviser to chief of International Bureau.
AT&T said it supports U.S. Trade Representative (USTR) emphasis on need for swift action on telecom market-opening commitments in S. Africa and Mexico described in annual review released Mon. (CD April 3 p2). “Mexico refuses to enforce regulations against Telmex, its incumbent telecommunications provider, to prevent anticompetitive practices, lower excessive interconnection rates for some types of domestic calls and provide cost-based interconnection for international calls,” AT&T said. In S. Africa, AT&T said, govt. should take immediate steps to implement its World Trade Organization (WTO) commitments, including restoring service to AT&T and other companies using network capacity of incumbent Telkom to provide enhanced services. USTR review singled out 11 countries where U.S. carriers had complained about compliance with telecom market-opening commitments with U.S. Of those, 4 were cited as raising “serious” concerns, including Taiwan and Colombia, in addition to Mexico and S. Africa. Meanwhile, CompTel late last week filed comments with Directorate General of Telecommunications (DGT) in Taiwan on that country’s deregulation task force. In 1998, U.S. Taiwan 1988 Accession Protocol on Taiwan’s proposed WTO entry committed it to open its telecom services market to foreign investors by July 1. CompTel raised 4 areas of concern on market access: (1) DGT should modify several licensing conditions imposed on international undersea cable operators in advance of July liberalization date. (2) Govt. should impose additional measures to ensure regulatory transparency in areas such as licensing criteria. (3) Regulators shouldn’t allow foreign investment restrictions to deprive outside investors of control of telecom ventures. (4) Govt. should streamline procedures for market entry by issuing general regulation on licensing.