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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of ) ) SWIFTCALL (USA) INC. ) File No. ITC-96-657 ) Application for Authority Pursuant to ) Section 214 of the Communications Act of ) 1934, as Amended, to Operate as an ) International Resale Carrier ) MEMORANDUM OPINION, ORDER, AUTHORIZATION, AND CERTIFICATE Adopted: September 30, 1997 Released: October 3, 1997 By the Chief, Telecommunications Division: I. Introduction 1. We have before us an application by Swiftcall (USA) Inc., ("Swiftcall") for authority pursuant to Section 214 of the Communications Act, as amended, to provide international switched and private line services by the resale of the international switched and private line services of other authorized carriers, pursuant to Section 63.18(e)(2) of the Commission Rules, 47 C.F.R. Section 63.18 (e)(2). AT&T opposed this application because of an alleged link between Swiftcall and another company against which AT&T had filed a complaint for providing service without proper Commission authority. For the reasons set forth below, we deny AT&T's petition and grant Swiftcall's application. II. Background 2. Swiftcall, a Virginia corporation, is a wholly-owned subsidiary of Swiftcall Holdings (USA) Limited, a Bahamas corporation. Swiftcall filed an application on November 25, 1996, for Section 214 authority to operate as a resale carrier. Services that Swiftcall seeks to provide include reselling international message telephone service ("IMTS") and reselling international private lines for the provision of switched services ("ISR") between the United States, and Canada, the United Kingdom, and Sweden. We initially listed the application as accepted for filing and eligible for streamlined processing on December 13, 1996. On January 7, 1997, AT&T filed a petition to deny grant of the application alleging a violation of Commission's rules by Swiftcall on the grounds that Swiftcall had been operating as an international common carrier providing ISR since 1993 without Section 214 authority. By letter dated January 9, 1997, the Commission notified Swiftcall that its application was removed from streamlined processing and would be acted upon by written order, pursuant to Section 63.12(c)(5) of the Commission's Rules. 3. In its petition, AT&T referred to an informal complaint it filed in November 1993, seeking that the Commission order the termination of all services offered by Swiftcall (UK) Ltd. found to be in violation of Commission rules, particularly ISR to the United Kingdom. AT&T now asserts that the present applicant, Swiftcall, is in fact the same company that provided ISR services between the United States and the United Kingdom for three years in violation of the Commission's rules. 4. In response, Swiftcall stated that AT&T's complaint against Swiftcall (UK) Ltd. is irrelevant to Swiftcall's application because the two companies are legally distinct and separately owned. In any event, Swiftcall contends that Swiftcall (UK) Ltd. operated as a private carrier and did not offer ISR services to the U.S. 5. In order to clarify the record, and in an effort to resolve the issues, Commission staff held a status conference with Swiftcall and AT&T on February 6, 1997. At this conference, we learned for the first time that Thomas M. McCabe, who was identified in Swiftcall's application as the beneficiary of Swiftcall Holdings, the entity controlling Swiftcall, was the same Thomas M. McCabe who was the Managing Director of Swiftcall (UK) Ltd. Due to this development, Swiftcall was asked to clarify again for the record what in fact were the connections between these two companies. 6. Following this status conference, Swiftcall, through counsel, submitted a letter further clarifying the relationship between Swiftcall and Swiftcall (UK) Ltd., focusing in particular on the role of Thomas McCabe. Swiftcall acknowledges that there were inaccuracies in its initial application which led to the confusion as to who controls Swiftcall and who has a beneficial interest. In the end, Swiftcall, through counsel, states that Mr. McCabe is named as only one of several potential beneficiaries, each of whom have no control over Swiftcall or its holding company. Swiftcall submitted an opinion written by a U.K. attorney that supports Swiftcall's argument that Mr. McCabe wields no power in the management and control of Swiftcall. III. Discussion 7. On the basis of the factual representations made by Swiftcall, through its counsel, we determine that the application of Swiftcall shall be evaluated on its own merits and independent of past activity of Swiftcall (UK) Ltd. Swiftcall, through counsel, has affirmed to the Commission that Swiftcall (UK) Ltd. ceased doing business in 1996, that Swiftcall is legally distinct and separately owned from the now defunct Swiftcall (UK) Ltd, and that Thomas McCabe neither directly nor indirectly owns or controls Swiftcall and has no current right to benefit financially from the activities of Swiftcall or Swiftcall Holdings. Thus, improper activities of Swiftcall (UK) Ltd., if any, should not be attributed to Swiftcall. AT&T provided no evidence to rebut these assertions. The Commission will, of course, reconsider this determination if information comes to light that suggests that the applicant's representations to the Commission were inaccurate or incomplete. In addition, we note that our actions here do not preclude AT&T from presenting the Commission with new evidence establishing that the two companies are so closely related that Swiftcall should be held liable for past improper actions, if any, of Swiftcall (UK) Ltd. 8. Upon consideration of the above, we find that Swiftcall s entry will increase competition in the United States and international markets and thus benefit U.S. consumers. Therefore, IT IS HEREBY CERTIFIED that the present and future public convenience and necessity require a grant of the present application. IV. Ordering Clauses 9. Accordingly, IT IS ORDERED that application File No. ITC-96-657 IS GRANTED, and Swiftcall is authorized to provide international switched and private line services by the resale of the international switched and private line services of other authorized carriers, pursuant to Section 63.18(e)(2) of the Commissions Rules, 47 C.F.R. Section 63.18 (e)(2). 10. IT IS FURTHER ORDERED that our authorization of Swiftcall to provide switched basic services over resold international private lines as part of its authorized services is limited to the resale of such private lines only between the United States and countries determined to afford resale opportunities equivalent to those available under U.S. law. See 47 C.F.R. Sections 68.18 (e)(2)(ii)(3) and (e)(3). In addition, Swiftcall's tariff must state that its customers may not connect private lines provided over these authorized facilities to the public switched network at either the U.S. or foreign ends other than Canada, the United Kingdom, Sweden, or New Zealand for the provision of international switched basic services, unless authorized to do so by the Commission upon finding that the foreign country affords resale opportunities equivalent to those available under U.S. law. The limitations in this paragraph are subject to the exception that Swiftcall may engage in "switched hubbing" consistent with Section 63.17(b) of the Commission's rules. 11. IT IS FURTHER ORDERED that Swiftcall shall report its provision of switched services over resold private lines on a semi-annual basis to the Commission in the manner required by Section 43.61 of the Commission's rules. This reporting requirement applies to traffic carried through December 1997 for the United Kingdom; December 1998 for Sweden; and December 1999 for New Zealand. These semi-annual reports shall be filed with the Commission not later than September 30 for the first six-month calendar period, and March 31 for the second six-month reporting period. 12. IT IS FURTHER ORDERED that Swiftcall shall comply with Sections 63.14, 63.15, 63.19, and 63.21 of the Commission s Rules. 13. IT IS FURTHER ORDERED that if Swiftcall intends to provide international callback through the use of uncompleted call signalling, its authorization to resell international switched voice and/or data services to provide these services is expressly subject to the conditions listed in VIA USA Ltd., et al., 9 FCC Rcd 2288 (1994), and in the Order on Reconsideration, 10 FCC Rcd 9540 (1995). 14. IT IS FURTHER ORDERED that AT&T's Petition to Deny is DENIED. 15. This Order is issued under Section 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 publication on this Order (see Section 1.4(b)(2) of the Commission's Rules, 47 C.F.R.  1.4(b)(2)). FEDERAL COMMUNICATIONS COMMISSION Diane J. Cornell Chief, Telecommunications Division International Bureau