NEWSReport No. DC 96-37    ACTION IN DOCKET CASE             April 25, 1996

       COMMISSION PROPOSES SIMPLE PROCEDURE FOR UTILITY COMPANIES 
                      TO ENTER TELECOMMUNICATIONS;
  Furthers Pro-Competitive Goals of the Telecommunications Act of 1996
                          (GC Docket No. 96-101)

       The Commission adopted a Notice of Proposed Rule Making today that provides a
simple procedure for determining "exempt telecommunications company" ("ETC") status, thus
expediting the entry of public utility holding companies into the telecommunications industry
consistent with the pro-competitive, de-regulatory thrust of the Telecommunications Act of
1996. 

       Section 103 of the 1996 Act adds new section 34 to the Public Utility Holding
Company Act (PUHCA) of 1935, which permits public utility holding companies to enter the
telecommunications industry without prior Securities and Exchange Commission approval by
acquiring or maintaining an interest in an ETC.  The legislation vests the Federal
Communications Commission with jurisdiction to determine whether a company warrants
ETC status based on specific statutory criteria.

       The Commission today proposed uncomplicated rules that establish the filing
requirements and procedures for persons seeking ETC status.  The proposed rules require
applicants seeking ETC status to file with the Commission a brief description of their planned
activities and a sworn statement attesting to any facts or representations presented to
demonstrate ETC status as defined in the 1996 Act.  The proposed procedures would also
provide for public comment on the application, but limit comment to the adequacy or
accuracy of the information presented.

       Noting that utilities generally have experience in telecommunications operations as
well as sufficient size and capital to be effective competitors to incumbent companies, the
Commission stated that the simple procedure set forth in the Notice is "the best mechanism to
expedite Congress's policy to allow holding companies to become vigorous competitors in
telecommunications  in order to promote the public interest."  Increased competition could
accelerate deployment of advanced networks and result in lower prices and greater choices for
consumers.

       The Commission stated that an ETC determination "should not involve an inquiry into
the public interest merits of entry" by the public utility holding companies.  The Commission
noted that to the extent such concerns exist, section 103 preserves state and federal
jurisdiction to examine these issues in other proceedings.  Thus, the Commission concluded, 
the public interest and the intent of Congress would not be served "if this process became a
regulatory barrier to significant new entry into the telecommunications industry."

       Since the enactment of the 1996 Act on February 8, 1996, the Commission has
granted three applications for ETC status.  Eight new applications have been filed recently. 
The law provides that ETC status is effective on filing until the Commission makes a
determination, and the Commission has 60 days to make such a determination.
       
       Action by the Commission April 25, 1996, by Notice of Proposed Rule Making (FCC
96-192). Chairman Hundt, Commissioners Quello, Ness and Chong.

   - FCC -
                                                                         
       News Media contact: Rochelle Cohen at (202) 418-0500.
       Office of General Counsel, Competition Division contacts: James W. Olson, Lawrence
               Spiwak, or Martin Stern at (202) 418-1880.