Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ASIA DIRECT COMMUNICATIONS, L.L.C. ) ) ATLANTIC EXPRESS COMMUNICATIONS, L.L.C. ) ) ATLANTIC EXPRESS COMMUNI- ) CATIONS II, L.L.C. ) ) BAHAMAS EXPRESS COMMUNICATIONS ) LTD., L.C. ) ) GUAM TELECOM, LTD., L.C. ) ) HAWAII EXPRESS COMMUNICATIONS, L.L.C. ) ) ORIENT EXPRESS COMMUNICATIONS, L.L.C. ) ) and ) ) NEPTUNE GLOBAL SYSTEMS, L.L.C. ) ) NEPTUNE COMMUNICATIONS, L.L.C. ) ) NEPTUNE COMMUNICATIONS CORP. ) ) and ) ) GC PACIFIC LANDING CORP. ) ) GLOBAL CROSSING LTD. ) ) Application for authority, pursuant to ) File Nos. SCL-ASG-19981204-00029 the Submarine Cable Landing License Act ) SCL-T/C-19981204-00030 to assign Cable Landing Licenses ) and to transfer control of the entity holding such ) Licenses ) ) MEMORANDUM OPINION, ORDER AND AUTHORIZATION Adopted: July 6, 1999 Released: July 7, 1999 By the Chief, Telecommunications Division: I. Introduction 1. Asia Direct Communications, L.L.C., Atlantic Express Communications, L.L.C., Atlantic Express Communications II, L.L.C., Bahamas Express Communications, Ltd., L.C., Guam Telecom, Ltd., L.C., Hawaii Express Communications, L.L.C., and Orient Express Communications, L.L.C. (collectively Current License Holders), and Neptune Global Systems, L.L.C. (Neptune Global), Neptune Communications, L.L.C., Neptune Communications Corp. (Neptune), Global Crossing Ltd. (Global Crossing) and GC Pacific Landing Corp. (collectively Joint Applicants), pursuant to the Cable Landing License Act, and Executive Order No. 10,530, submitted the above-captioned application requesting authority to: (1) assign the cable landing licenses held by the Current License Holders (the Licenses) to Neptune; and (2) transfer control of Neptune (as the holder of the Licenses) from Neptune Communications, L.L.C., to GC Pacific Landing, which is an indirect, wholly-owned subsidiary of Global Crossing Ltd. (Global Crossing), which will control the licenses. The Joint Applicants anticipate that control of Neptune will transfer to GC Pacific Landing simultaneously with the assignment of the Licenses to Neptune. The application requests the two transactions separately, however, so that if the proposed merger between Neptune and GC Pacific Landing Corp. does not take place, Neptune will remain the licensee and Neptune Communications, L.L.C. will ultimately control the licenses. The application was placed on public notice on December 23, 1998 (Report No. TEL-00047NS). We received no comments. A. Assignment of Cable Landing Licenses 2. The seven Current License Holders each holds a Cable Landing License for a private submarine cable. The Current License Holders seek authority to assign the Licenses to Neptune Global, a Delaware limited liability company owned by the principals of the Current License Holders. The Current License Holders then seek authority to assign the Licenses from Neptune Global to Neptune Communications, L.L.C., a Delaware limited liability company owned in part by the Current License Holders. Neptune Communications, L.L.C. will, in turn, assign the Licenses to its wholly-owned subsidiary, Neptune, a Delaware corporation. The net result of these events will be the assignment of the Licenses from the Current License Holders to Neptune. B. Transfer of Control 3. The Joint Applicants anticipate that GC Pacific Landing, a Delaware corporation and an indirect, wholly-owned subsidiary of Global Crossing, a Bermuda corporation, will be merged with and into Neptune. Neptune will be the surviving corporation in the merger but will take the name of GC Pacific Landing Corp. At the close of the merger, new GC Pacific Landing Corp. (the renamed surviving entity) will be the holder of the Licenses and will be controlled by Global Crossing. The Joint Applicants have stated in their application for transfer of control that there is a possibility that the proposed merger of existing GC Pacific Landing Corp. with and into Neptune may not be consummated for business reasons independent of this application. In the event the merger is not consummated, the Joint Applicants have stated that Neptune will hold, and Neptune Communications, L.L.C., will control, the Licenses and that the Commission will be notified as appropriate. II. Discussion 4. As required by Section 1.767(a)(6) of the Commission's rules, the Joint Applicants have listed their ownership information, including foreign affiliations. Based on their application, the foreign affiliates of Neptune and GC Pacific Landing Corp. do not raise concerns that warrant denial of the application under the Cable Landing License Act. The Joint Applicants state that neither Neptune nor GC Pacific Landing are foreign carriers. Neptune is not affiliated with any foreign carriers. Since the Joint Applicants filed their application, GC Pacific Landing Corp. notified the Commission of its foreign carrier affiliations. As an indirect, wholly-owned subsidiary of Global Crossing, GC Pacific Landing Corp is affiliated with foreign carriers in the following countries: Switzerland, Denmark, Germany, the Netherlands, France, Italy, the United Kingdom, Belgium, and Ireland. In addition, GC Landing Corp. will soon become affiliated with a foreign carrier in Austria. GC Landing Corp. is also affiliated with a foreign company that holds a Type I license in Japan, but which is not currently providing service. GC Pacific Landing Corp. states that all of the affiliated carriers are new licensees that lack market power in their home countries. 5. Except for Japan and the United Kingdom, we find that the foreign affiliations do not affect grant of the application because none of the cable systems land in these countries. As for Japan and the United Kingdom, we find that because the carriers are new licensees with no market power, these affiliations do not affect the grant of this application. 6. Pursuant to Section 1.767(b) of the Commission's Rules, the Cable Landing License Act, and Executive Order No. 10530, we informed the Department of State of the application. The Department of State, after coordinating with the National Telecommunications and Information Administration and the Department of Defense, stated that it has no objection to the proposed transactions. 7. Upon consideration of the application and in view of the foregoing, we conclude that consent to: (1) assign the cable landing licenses held by the Current License Holders to Neptune; and (2) transfer ultimate control of Neptune from Neptune Communications, L.L.C., to Global Crossing will serve the public interest, convenience and necessity. III. Ordering Clauses 8. Accordingly, IT IS ORDERED that the application of the Joint Applicants, File No. SCL- ASG-19981204-00029, for the ultimate assignment of Licenses held by the Current License Holders to Neptune Communications Corp., a wholly-owned subsidiary of Neptune Communications, L.L.C., is GRANTED. 9. IT IS FURTHER ORDERED that the application, File No. SCL-T/C-19981204-00030, for the merger of GC Pacific Landing Corp. with and into Neptune with the ultimate transfer of control of Neptune from Neptune Communications L.L.C. to Global Crossing is GRANTED. 10. IT IS FURTHER ORDERED that, in the event the proposed merger of GC Pacific Landing Corp. with and into Neptune Communications Corp. is not consummated, the Joint Applicants shall notify the Commission that the merger was not concluded. Consequently, Neptune Communications Corp. may hold, and Neptune Communications L.L.C. may control the Licenses. 11. IT IS FURTHER ORDERED that all terms and conditions imposed on the related licenses as listed in footnote 3 remain in effect. 12. This Order is issued under Section 0.261 of the Commission's rules, 47 C.F.R.  0.261 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, 47 C.F.R.  1.106, 1.115, may be filed within 30 days of the date of public notice of this Order (see 47 C.F.R.  1.4(b)(2)). FEDERAL COMMUNICATIONS COMMISSION Rebecca Arbogast Chief, Telecommunications Division International Bureau