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DA 96-1205 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) Streamlining the International ) IB 95-118 Section 214 Authorization Process ) and Tariff Requirements -- ) Exclusion List ) ORDER Adopted: July 26, 1996 Released: July 29, 1996 By the Chief, Telecommunications Division: I. INTRODUCTION 1. In this order, we adopt an exclusion list identifying restrictions on providing service using particular facilities or to particular countries for those carriers receiving a global international Section 214 authorization. The exclusion list is attached to this order as Appendix A. II. BACKGROUND 2. Effective June 13, 1996, the Office of Management and Budget approved the Commission's new procedures for the international Section 214 authorization process and tariff requirements. The new procedures were adopted in the Report and Order, Streamlining the International Section 214 Authorization Process and Tariff Requirements, IB Docket No. 95-118, FCC 96-79 (rel. March 13, 1996) (Streamlining Order). The Streamlining Order adopted, inter alia, procedures for issuing global, rather than country- and facility-specific, Section 214 authorizations to qualified applicants. As part of the new procedures, the International Bureau (Bureau) must establish and maintain an exclusion list identifying restrictions on providing service using particular facilities or to particular countries for those carriers receiving a global Section 214 authorization. On June 20, 1996, the Bureau released a Public Notice seeking comment on a draft exclusion list for global Section 214 authorizations. Three parties filed comments in response to the Public Notice. III. COMMENTS 3. OPTEL Communications, Inc. (OPTEL) and Teleglobe USA Inc. (TGUSA) oppose the placement of the CANUS-1 Cable System (CANUS-1) on the exclusion list. OPTEL is the U.S. licensee for CANUS-1. TGUSA's parent company, Teleglobe Inc., owns a 20 percent share of OPTEL. Both OPTEL and TGUSA argue that there are no "imperative circumstances," as that term is used in the Streamlining Order, warranting the placement of CANUS-1 on the exclusion list. More specifically, OPTEL argues that conditions in OPTEL's landing license already give the Commission sufficient control over the use of CANUS-1. For example, OPTEL observes that the Commission has previously reserved the right to take corrective measures against harmful diversion of U.S.-Europe traffic through Canada through the Section 214 authorization process. It states, however, that it is premature to place CANUS-1 on the exclusion list before there is any evidence of traffic diversion that is harmful to U.S. carriers or ratepayers. OPTEL states that the Commission can always amend the exclusion list at such time as it feels it is warranted. OPTEL also argues that the Commission is able to exercise control over Teleglobe's use of CANUS-1 without placing the facility on the exclusion list. Condition No. 6 of OPTEL's license requires Teleglobe to obtain Section 214 authorization from the Commission before it can acquire capacity on CANUS-1. OPTEL is concerned that placing CANUS-1 on the exclusion list would be detrimental to the success of CANUS-1 and would burden U.S. carriers desiring to use the cable. 4. TGUSA argues that inclusion of CANUS-1 in the exclusion list may result in the filing of frivolous oppositions, administrative delay and litigation costs for applicants. TGUSA, like OPTEL, contends that there are already adequate procedural mechanisms in place to regulate the use of CANUS-1, including the conditions of the cable landing license and the collection of annual circuit reports. TGUSA further argues that, by removing regulatory impediments to using CANUS-1 (in conjunction with Canada's CANTAT-3 cable), U.S. carriers will be in a stronger position to negotiate improved access to U.S. common carrier cables. 5. MFS International, Inc. (MFSI) urges the Commission to reformat the exclusion list to identify only those countries and facilities that carriers may not use without specific FCC approval. MFSI argues that the draft list is confusing in that it includes countries and facilities that are excluded as well as a list of non-U.S. licensed facilities that U.S. carriers are permitted to use. MFSI argues that the format of the list will cause delay and uncertainty for U.S. carriers attempting to negotiate access to new, non-U.S. licensed facilities that have not yet been placed on the exclusion list as "permitted" non-U.S.-licensed facilities. MFSI requests that, if the Commission does not adopt MFSI's proposal to limit the exclusion list to facilities that carriers are not permitted to use, the Commission should permit U.S. carriers to negotiate and obtain capacity on non-U.S. licensed facilities prior to their inclusion in the exclusion list as "permitted" facilities. Finally, MFSI urges that three facilities, Sea-Me-We 3, U.K.- Denmark 4 and U.K.-Netherlands 14 cable systems, should be approved for use by U.S. carriers operating under global Section 214 authority. IV. DISCUSSION 6. In the Streamlining Order, the Commission stated that countries or facilities would be placed on the exclusion list in only "the most imperative of circumstances." We recognize the concerns of OPTEL and TGUSA that including CANUS-1 on the exclusion list may place the cable system at a competitive disadvantage and impose undue costs on carriers and the Commission. We are concerned, however, that removal of the cable from the exclusion list may be inconsistent with certain conditions of the U.S. Department of State's support for grant of the CANUS-1 cable landing license. That letter provides, inter alia, that "all common carriers, including Teleglobe, seeking to acquire or use capacity on CANUS-1 for common carrier services must obtain Section 214 authorization from the Commission. In this regard, the Department requests that the Commission notify it of any such applications or other filings to provide an opportunity for review and comments to the Commission, as appropriate." Because of the general nature of our global Section 214 authorizations, it would be impossible to know which applicants were planning to use the CANUS-1 cable. We therefore find it necessary to maintain the CANUS-1 cable on the exclusion list for at least that period of time necessary to complete consultations with the State Department on this issue. We will endeavor to complete this process within the next 30 days. We will promptly issue an order either to modify our action here or affirm it. In the meantime, we emphasize that the listing of CANUS-1 on the exclusion list only means that U.S. carriers must file a Section 214 application at this time in order to use the CANUS-1 facility. It does not mean that carriers will not be given authority to use the cable if specifically requested. 7. We also do not adopt MFSI's suggestion to change the format of the exclusion list. Our new rules provide that carriers with facilities-based, global Section 214 authorizations may provide service using half-circuits on appropriately licensed U.S. common and non- common carrier facilities provided these facilities do not appear on the exclusion list and any necessary overseas connecting facilities. The rules also provide that such carriers may not use non-U.S. licensed facilities unless and until the Commission specifically approves their use and so indicates on the exclusion list. The format of the exclusion list necessarily follows these authorization requirements. We also do not agree with MFSI that the exclusion list is confusing. The exclusion list identifies which countries and U.S. facilities are not covered by grant of global Section 214 authority. It also identifies those non-U.S. licensed facilities that are covered by a grant of global authority. The list states that "All non-U.S. licensed Cable and Satellite Systems" are excluded from a grant of global Section 214 authority, except for those facilities specifically listed under the heading, "Foreign Cable Systems." The Streamlining Order established a procedural mechanism through which non-U.S. licensed facilities may be approved for use by carriers with global Section 214 authority. We do not foresee that this procedure will be anything but expeditious. U.S. carriers negotiating agreements to acquire capacity on non-U.S. licensed facilities that do not appear on the exclusion list should promptly request that we amend the exclusion list to permit use of those facilities whether planned or in-service. For instance, now that MFSI has notified us of new cable systems, we agree that the Sea-Me-We 3, U.K.-Denmark 4, and U.K.-Netherlands 14 cable systems should be listed as "permitted" non-U.S. licensed systems. We therefore amend the exclusion list to permit use of these facilities by carriers with global authority. V. ORDERING CLAUSES 8. Accordingly, IT IS ORDERED that the Exclusion List attached as Appendix A to this order, which identifies restrictions on providing service using particular facilities or to particular countries for those carriers receiving a global Section 214 authorization, is hereby adopted. 9. This order is issued under 0.261 of the Commission's Rules and is effective upon adoption. Petitions for reconsideration under Section 1.106 or applications for review under Section 1.115 of the Commission's Rules may be filed within 30 days of the date of the public notice of this Order (see 47 C.F.R.  1.4(b)(2)). FEDERAL COMMUNICATIONS COMMISSION Diane J. Cornell Chief, Telecommunications Division International Bureau APPENDIX A International Section 214 Authorizations -- Exclusion List as of July 26, 1996 -- The following is a list of countries and facilities not covered by grant of global Section 214 authority under Section 63.18(e)(1) of the Commission's Rules. 47 C.F.R. 63.18(e)(1). In addition, the facilities listed shall not be used by U.S. carriers authorized under Section 63.01 of the Commission's Rules, unless the carrier's Section 214 authorization specifically lists the facility. Carriers desiring to serve countries or use facilities listed as excluded hereon shall file a separate Section 214 application pursuant to Section 63.18(e)(6) of the Commission's Rules. Countries Cuba (applications for service to this country shall comply with the separate filing requirements of the Commission's Public Notice Report No. I-6831, dated July 27, 1993, "FCC to Accept Applications for Service to Cuba.") Facilities CANUS-1 Cable System All non-U.S. licensed Cable and Satellite Systems Except: Foreign Cable Systems Aden-Djibouti APC APCN APHRODITE 2 ARIANNE 2 ASEAN B-M-P Brunei-Singapore CADMOS CANTAT-3 CARAC CELTIC China-Japan CIOS Denmark-Russia 1 ECFS EMOS-1 EURAFRICA Germany-Denmark 1 Germany-Sweden No. 4 Germany-Sweden No. 5 H-J-K HONTAI-2 ITUR KATTEGAT-1 Kuantan-Kota Kinabalu LATVIA-SWEDEN Malaysia-Thailand Marseille/Palermo Link MAT-2 ODIN PENCAN-5 R-J-K RIOJA SAT-2 SEA-ME-WE 2 SEA-ME-WE 3 T-V-H TAGIDE 2 TASMAN 2 UGARIT UK-BEL 6 UK-Denmark 4 UK-Germany 5 UK-Netherlands 12 UK-Netherlands 14 UK-Spain 4 UNISUR This list is subject to change by the Commission when the public interest requires. Before amending the list, the Commission will first issue a public notice giving affected parties the opportunity for comment and hearing on the proposed changes. The Commission will then release an order amending the exclusion list. This list also is subject to change upon issuance of an Executive Order. See Streamlining the Section 214 Authorization Process and Tariff Requirements, IB Docket No. 95-118 FCC 96-79, released March 13, 1996. For additional information, contact the International Bureau's Telecommunications Division, Policy & Facilities Branch, (202) 418-1460.