[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 652 Enrolled Bill (ENR)]
S.652
One Hundred Fourth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Wednesday,
the third day of January, one thousand nine hundred and ninety-six
An Act
To promote competition and reduce regulation in order to secure lower
prices and higher quality services for American telecommunications
consumers and encourage the rapid deployment of new telecommunications
technologies.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; REFERENCES.
(a) Short Title.--This Act may be cited as the ``Telecommunications
Act of 1996''.
(b) References.--Except as otherwise expressly provided, whenever
in this Act an amendment or repeal is expressed in terms of an
amendment to, or repeal of, a section or other provision, the reference
shall be considered to be made to a section or other provision of the
Communications Act of 1934 (47 U.S.C. 151 et seq.).
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
Sec. 1. Short title; references.
Sec. 2. Table of contents.
Sec. 3. Definitions.
TITLE I--TELECOMMUNICATION SERVICES
Subtitle A--Telecommunications Services
Sec. 101. Establishment of part II of title II.
``Part II--Development of Competitive Markets
``Sec. 251. Interconnection.
``Sec. 252. Procedures for negotiation, arbitration, and approval of
agreements.
``Sec. 253. Removal of barriers to entry.
``Sec. 254. Universal service.
``Sec. 255. Access by persons with disabilities.
``Sec. 256. Coordination for interconnectivity.
``Sec. 257. Market entry barriers proceeding.
``Sec. 258. Illegal changes in subscriber carrier selections.
``Sec. 259. Infrastructure sharing.
``Sec. 260. Provision of telemessaging service.
``Sec. 261. Effect on other requirements.''
Sec. 102. Eligible telecommunications carriers.
Sec. 103. Exempt telecommunications companies.
Sec. 104. Nondiscrimination principle.
Subtitle B--Special Provisions Concerning Bell Operating Companies
Sec. 151. Bell operating company provisions.
``PART III--SPECIAL PROVISIONS CONCERNING BELL OPERATING COMPANIES
``Sec. 271. Bell operating company entry into interLATA services.
``Sec. 272. Separate affiliate; safeguards.
``Sec. 273. Manufacturing by Bell operating companies.
``Sec. 274. Electronic publishing by Bell operating companies.
``Sec. 275. Alarm monitoring services.
``Sec. 276. Provision of payphone service.''
TITLE II--BROADCAST SERVICES
Sec. 201. Broadcast spectrum flexibility.
``Sec. 336. Broadcast spectrum flexibility.''
Sec. 202. Broadcast ownership.
Sec. 203. Term of licenses.
Sec. 204. Broadcast license renewal procedures.
Sec. 205. Direct broadcast satellite service.
Sec. 206. Automated ship distress and safety systems.
``Sec. 365. Automated ship distress and safety systems.''
Sec. 207. Restrictions on over-the-air reception devices.
TITLE III--CABLE SERVICES
Sec. 301. Cable Act reform.
Sec. 302. Cable service provided by telephone companies.
``Part V--Video Programming Services Provided by Telephone Companies
``Sec. 651. Regulatory treatment of video programming services.
``Sec. 652. Prohibition on buy outs.
``Sec. 653. Establishment of open video systems.''
Sec. 303. Preemption of franchising authority regulation of
telecommunications services.
Sec. 304. Competitive availability of navigation devices.
``Sec. 629. Competitive availability of navigation devices.''
Sec. 305. Video programming accessibility.
``Sec. 713. Video programming accessibility.''
TITLE IV--REGULATORY REFORM
Sec. 401. Regulatory forbearance.
``Sec. 10. Competition in provision of telecommunications service.''
Sec. 402. Biennial review of regulations; regulatory relief.
``Sec. 11. Regulatory reform.''
Sec. 403. Elimination of unnecessary Commission regulations and
functions.
TITLE V--OBSCENITY AND VIOLENCE
Subtitle A--Obscene, Harassing, and Wrongful Utilization of
Telecommunications Facilities
Sec. 501. Short title.
Sec. 502. Obscene or harassing use of telecommunications facilities
under the Communications Act of 1934.
Sec. 503. Obscene programming on cable television.
Sec. 504. Scrambling of cable channels for nonsubscribers.
``Sec. 640. Scrambling of cable channels for nonsubscribers.''
Sec. 505. Scrambling of sexually explicit adult video service
programming.
``Sec. 641. Scrambling of sexually explicit adult video service
programming.''
Sec. 506. Cable operator refusal to carry certain programs.
Sec. 507. Clarification of current laws regarding communication of
obscene materials through the use of computers.
Sec. 508. Coercion and enticement of minors.
Sec. 509. Online family empowerment.
``Sec. 230. Protection for private blocking and screening of
offensive material.''
Subtitle B--Violence
Sec. 551. Parental choice in television programming.
Sec. 552. Technology fund.
Subtitle C--Judicial Review
Sec. 561. Expedited review.
TITLE VI--EFFECT ON OTHER LAWS
Sec. 601. Applicability of consent decrees and other law.
Sec. 602. Preemption of local taxation with respect to direct-to-home
services.
TITLE VII--MISCELLANEOUS PROVISIONS
Sec. 701. Prevention of unfair billing practices for information or
services provided over toll-free telephone calls.
Sec. 702. Privacy of customer information.
``Sec. 222. Privacy of customer information.''
Sec. 703. Pole attachments.
Sec. 704. Facilities siting; radio frequency emission standards.
Sec. 705. Mobile services direct access to long distance carriers.
Sec. 706. Advanced telecommunications incentives.
Sec. 707. Telecommunications Development Fund.
``Sec. 714. Telecommunications Development Fund.''
Sec. 708. National Education Technology Funding Corporation.
Sec. 709. Report on the use of advanced telecommunications services for
medical purposes.
Sec. 710. Authorization of appropriations.
SEC. 3. DEFINITIONS.
(a) Additional Definitions.--Section 3 (47 U.S.C. 153) is amended--
(1) in subsection (r)--
(A) by inserting ``(A)'' after ``means''; and
(B) by inserting before the period at the end the
following: ``, or (B) comparable service provided through a
system of switches, transmission equipment, or other facilities
(or combination thereof) by which a subscriber can originate
and terminate a telecommunications service''; and
(2) by adding at the end thereof the following:
``(33) Affiliate.--The term `affiliate' means a person that
(directly or indirectly) owns or controls, is owned or controlled
by, or is under common ownership or control with, another person.
For purposes of this paragraph, the term `own' means to own an
equity interest (or the equivalent thereof) of more than 10
percent.
``(34) AT&T consent decree.--The term `AT&T Consent Decree'
means the order entered August 24, 1982, in the antitrust action
styled United States v. Western Electric, Civil Action No. 82-0192,
in the United States District Court for the District of Columbia,
and includes any judgment or order with respect to such action
entered on or after August 24, 1982.
``(35) Bell operating company.--The term `Bell operating
company'--
``(A) means any of the following companies: Bell Telephone
Company of Nevada, Illinois Bell Telephone Company, Indiana
Bell Telephone Company, Incorporated, Michigan Bell Telephone
Company, New England Telephone and Telegraph Company, New
Jersey Bell Telephone Company, New York Telephone Company, U S
West Communications Company, South Central Bell Telephone
Company, Southern Bell Telephone and Telegraph Company,
Southwestern Bell Telephone Company, The Bell Telephone Company
of Pennsylvania, The Chesapeake and Potomac Telephone Company,
The Chesapeake and Potomac Telephone Company of Maryland, The
Chesapeake and Potomac Telephone Company of Virginia, The
Chesapeake and Potomac Telephone Company of West Virginia, The
Diamond State Telephone Company, The Ohio Bell Telephone
Company, The Pacific Telephone and Telegraph Company, or
Wisconsin Telephone Company; and
``(B) includes any successor or assign of any such company
that provides wireline telephone exchange service; but
``(C) does not include an affiliate of any such company,
other than an affiliate described in subparagraph (A) or (B).
``(36) Cable service.--The term `cable service' has the meaning
given such term in section 602.
``(37) Cable system.--The term `cable system' has the meaning
given such term in section 602.
``(38) Customer premises equipment.--The term `customer
premises equipment' means equipment employed on the premises of a
person (other than a carrier) to originate, route, or terminate
telecommunications.
``(39) Dialing parity.--The term `dialing parity' means that a
person that is not an affiliate of a local exchange carrier is able
to provide telecommunications services in such a manner that
customers have the ability to route automatically, without the use
of any access code, their telecommunications to the
telecommunications services provider of the customer's designation
from among 2 or more telecommunications services providers
(including such local exchange carrier).
``(40) Exchange access.--The term `exchange access' means the
offering of access to telephone exchange services or facilities for
the purpose of the origination or termination of telephone toll
services.
``(41) Information service.--The term `information service'
means the offering of a capability for generating, acquiring,
storing, transforming, processing, retrieving, utilizing, or making
available information via telecommunications, and includes
electronic publishing, but does not include any use of any such
capability for the management, control, or operation of a
telecommunications system or the management of a telecommunications
service.
``(42) Interlata service.--The term `interLATA service' means
telecommunications between a point located in a local access and
transport area and a point located outside such area.
``(43) Local access and transport area.--The term `local access
and transport area' or `LATA' means a contiguous geographic area--
``(A) established before the date of enactment of the
Telecommunications Act of 1996 by a Bell operating company such
that no exchange area includes points within more than 1
metropolitan statistical area, consolidated metropolitan
statistical area, or State, except as expressly permitted under
the AT&T Consent Decree; or
``(B) established or modified by a Bell operating company
after such date of enactment and approved by the Commission.
``(44) Local exchange carrier.--The term `local exchange
carrier' means any person that is engaged in the provision of
telephone exchange service or exchange access. Such term does not
include a person insofar as such person is engaged in the provision
of a commercial mobile service under section 332(c), except to the
extent that the Commission finds that such service should be
included in the definition of such term.
``(45) Network element.--The term `network element' means a
facility or equipment used in the provision of a telecommunications
service. Such term also includes features, functions, and
capabilities that are provided by means of such facility or
equipment, including subscriber numbers, databases, signaling
systems, and information sufficient for billing and collection or
used in the transmission, routing, or other provision of a
telecommunications service.
``(46) Number portability.--The term `number portability' means
the ability of users of telecommunications services to retain, at
the same location, existing telecommunications numbers without
impairment of quality, reliability, or convenience when switching
from one telecommunications carrier to another.
``(47) Rural telephone company.--The term `rural telephone
company' means a local exchange carrier operating entity to the
extent that such entity--
``(A) provides common carrier service to any local exchange
carrier study area that does not include either--
``(i) any incorporated place of 10,000 inhabitants or
more, or any part thereof, based on the most recently
available population statistics of the Bureau of the
Census; or
``(ii) any territory, incorporated or unincorporated,
included in an urbanized area, as defined by the Bureau of
the Census as of August 10, 1993;
``(B) provides telephone exchange service, including
exchange access, to fewer than 50,000 access lines;
``(C) provides telephone exchange service to any local
exchange carrier study area with fewer than 100,000 access
lines; or
``(D) has less than 15 percent of its access lines in
communities of more than 50,000 on the date of enactment of the
Telecommunications Act of 1996.
``(48) Telecommunications.--The term `telecommunications' means
the transmission, between or among points specified by the user, of
information of the user's choosing, without change in the form or
content of the information as sent and received.
``(49) Telecommunications carrier.--The term
`telecommunications carrier' means any provider of
telecommunications services, except that such term does not include
aggregators of telecommunications services (as defined in section
226). A telecommunications carrier shall be treated as a common
carrier under this Act only to the extent that it is engaged in
providing telecommunications services, except that the Commission
shall determine whether the provision of fixed and mobile satellite
service shall be treated as common carriage.
``(50) Telecommunications equipment.--The term
`telecommunications equipment' means equipment, other than customer
premises equipment, used by a carrier to provide telecommunications
services, and includes software integral to such equipment
(including upgrades).
``(51) Telecommunications service.--The term
`telecommunications service' means the offering of
telecommunications for a fee directly to the public, or to such
classes of users as to be effectively available directly to the
public, regardless of the facilities used.''.
(b) Common Terminology.--Except as otherwise provided in this Act,
the terms used in this Act have the meanings provided in section 3 of
the Communications Act of 1934 (47 U.S.C. 153), as amended by this
section.
(c) Stylistic Consistency.--Section 3 (47 U.S.C. 153) is amended--
(1) in subsections (e) and (n), by redesignating clauses (1),
(2), and (3), as clauses (A), (B), and (C), respectively;
(2) in subsection (w), by redesignating paragraphs (1) through
(5) as subparagraphs (A) through (E), respectively;
(3) in subsections (y) and (z), by redesignating paragraphs (1)
and (2) as subparagraphs (A) and (B), respectively;
(4) by redesignating subsections (a) through (ff) as paragraphs
(1) through (32);
(5) by indenting such paragraphs 2 em spaces;
(6) by inserting after the designation of each such paragraph--
(A) a heading, in a form consistent with the form of the
heading of this subsection, consisting of the term defined by
such paragraph, or the first term so defined if such paragraph
defines more than one term; and
(B) the words ``The term'';
(7) by changing the first letter of each defined term in such
paragraphs from a capital to a lower case letter (except for
``United States'', ``State'', ``State commission'', and ``Great
Lakes Agreement''); and
(8) by reordering such paragraphs and the additional paragraphs
added by subsection (a) in alphabetical order based on the headings
of such paragraphs and renumbering such paragraphs as so reordered.
(d) Conforming Amendments.--The Act is amended--
(1) in section 225(a)(1), by striking ``section 3(h)'' and
inserting ``section 3'';
(2) in section 332(d), by striking ``section 3(n)'' each place
it appears and inserting ``section 3''; and
(3) in sections 621(d)(3), 636(d), and 637(a)(2), by striking
``section 3(v)'' and inserting ``section 3''.
TITLE I--TELECOMMUNICATION SERVICES
Subtitle A--Telecommunications Services
SEC. 101. ESTABLISHMENT OF PART II OF TITLE II.
(a) Amendment.--Title II is amended by inserting after section 229
(47 U.S.C. 229) the following new part:
``PART II--DEVELOPMENT OF COMPETITIVE MARKETS
``SEC. 251. INTERCONNECTION.
``(a) General Duty of Telecommunications Carriers.--Each
telecommunications carrier has the duty--
``(1) to interconnect directly or indirectly with the
facilities and equipment of other telecommunications carriers; and
``(2) not to install network features, functions, or
capabilities that do not comply with the guidelines and standards
established pursuant to section 255 or 256.
``(b) Obligations of All Local Exchange Carriers.--Each local
exchange carrier has the following duties:
``(1) Resale.--The duty not to prohibit, and not to impose
unreasonable or discriminatory conditions or limitations on, the
resale of its telecommunications services.
``(2) Number portability.--The duty to provide, to the extent
technically feasible, number portability in accordance with
requirements prescribed by the Commission.
``(3) Dialing parity.--The duty to provide dialing parity to
competing providers of telephone exchange service and telephone
toll service, and the duty to permit all such providers to have
nondiscriminatory access to telephone numbers, operator services,
directory assistance, and directory listing, with no unreasonable
dialing delays.
``(4) Access to rights-of-way.--The duty to afford access to
the poles, ducts, conduits, and rights-of-way of such carrier to
competing providers of telecommunications services on rates, terms,
and conditions that are consistent with section 224.
``(5) Reciprocal compensation.--The duty to establish
reciprocal compensation arrangements for the transport and
termination of telecommunications.
``(c) Additional Obligations of Incumbent Local Exchange
Carriers.--In addition to the duties contained in subsection (b), each
incumbent local exchange carrier has the following duties:
``(1) Duty to negotiate.--The duty to negotiate in good faith
in accordance with section 252 the particular terms and conditions
of agreements to fulfill the duties described in paragraphs (1)
through (5) of subsection (b) and this subsection. The requesting
telecommunications carrier also has the duty to negotiate in good
faith the terms and conditions of such agreements.
``(2) Interconnection.--The duty to provide, for the facilities
and equipment of any requesting telecommunications carrier,
interconnection with the local exchange carrier's network--
``(A) for the transmission and routing of telephone
exchange service and exchange access;
``(B) at any technically feasible point within the
carrier's network;
``(C) that is at least equal in quality to that provided by
the local exchange carrier to itself or to any subsidiary,
affiliate, or any other party to which the carrier provides
interconnection; and
``(D) on rates, terms, and conditions that are just,
reasonable, and nondiscriminatory, in accordance with the terms
and conditions of the agreement and the requirements of this
section and section 252.
``(3) Unbundled access.--The duty to provide, to any requesting
telecommunications carrier for the provision of a
telecommunications service, nondiscriminatory access to network
elements on an unbundled basis at any technically feasible point on
rates, terms, and conditions that are just, reasonable, and
nondiscriminatory in accordance with the terms and conditions of
the agreement and the requirements of this section and section 252.
An incumbent local exchange carrier shall provide such unbundled
network elements in a manner that allows requesting carriers to
combine such elements in order to provide such telecommunications
service.
``(4) Resale.--The duty--
``(A) to offer for resale at wholesale rates any
telecommunications service that the carrier provides at retail
to subscribers who are not telecommunications carriers; and
``(B) not to prohibit, and not to impose unreasonable or
discriminatory conditions or limitations on, the resale of such
telecommunications service, except that a State commission may,
consistent with regulations prescribed by the Commission under
this section, prohibit a reseller that obtains at wholesale
rates a telecommunications service that is available at retail
only to a category of subscribers from offering such service to
a different category of subscribers.
``(5) Notice of changes.--The duty to provide reasonable public
notice of changes in the information necessary for the transmission
and routing of services using that local exchange carrier's
facilities or networks, as well as of any other changes that would
affect the interoperability of those facilities and networks.
``(6) Collocation.--The duty to provide, on rates, terms, and
conditions that are just, reasonable, and nondiscriminatory, for
physical collocation of equipment necessary for interconnection or
access to unbundled network elements at the premises of the local
exchange carrier, except that the carrier may provide for virtual
collocation if the local exchange carrier demonstrates to the State
commission that physical collocation is not practical for technical
reasons or because of space limitations.
``(d) Implementation.--
``(1) In general.--Within 6 months after the date of enactment
of the Telecommunications Act of 1996, the Commission shall
complete all actions necessary to establish regulations to
implement the requirements of this section.
``(2) Access standards.--In determining what network elements
should be made available for purposes of subsection (c)(3), the
Commission shall consider, at a minimum, whether--
``(A) access to such network elements as are proprietary in
nature is necessary; and
``(B) the failure to provide access to such network
elements would impair the ability of the telecommunications
carrier seeking access to provide the services that it seeks to
offer.
``(3) Preservation of state access regulations.--In prescribing
and enforcing regulations to implement the requirements of this
section, the Commission shall not preclude the enforcement of any
regulation, order, or policy of a State commission that--
``(A) establishes access and interconnection obligations of
local exchange carriers;
``(B) is consistent with the requirements of this section;
and
``(C) does not substantially prevent implementation of the
requirements of this section and the purposes of this part.
``(e) Numbering Administration.--
``(1) Commission authority and jurisdiction.--The Commission
shall create or designate one or more impartial entities to
administer telecommunications numbering and to make such numbers
available on an equitable basis. The Commission shall have
exclusive jurisdiction over those portions of the North American
Numbering Plan that pertain to the United States. Nothing in this
paragraph shall preclude the Commission from delegating to State
commissions or other entities all or any portion of such
jurisdiction.
``(2) Costs.--The cost of establishing telecommunications
numbering administration arrangements and number portability shall
be borne by all telecommunications carriers on a competitively
neutral basis as determined by the Commission.
``(f) Exemptions, Suspensions, and Modifications.--
``(1) Exemption for certain rural telephone companies.--
``(A) Exemption.--Subsection (c) of this section shall not
apply to a rural telephone company until (i) such company has
received a bona fide request for interconnection, services, or
network elements, and (ii) the State commission determines
(under subparagraph (B)) that such request is not unduly
economically burdensome, is technically feasible, and is
consistent with section 254 (other than subsections (b)(7) and
(c)(1)(D) thereof).
``(B) State termination of exemption and implementation
schedule.--The party making a bona fide request of a rural
telephone company for interconnection, services, or network
elements shall submit a notice of its request to the State
commission. The State commission shall conduct an inquiry for
the purpose of determining whether to terminate the exemption
under subparagraph (A). Within 120 days after the State
commission receives notice of the request, the State commission
shall terminate the exemption if the request is not unduly
economically burdensome, is technically feasible, and is
consistent with section 254 (other than subsections (b)(7) and
(c)(1)(D) thereof). Upon termination of the exemption, a State
commission shall establish an implementation schedule for
compliance with the request that is consistent in time and
manner with Commission regulations.
``(C) Limitation on exemption.--The exemption provided by
this paragraph shall not apply with respect to a request under
subsection (c) from a cable operator providing video
programming, and seeking to provide any telecommunications
service, in the area in which the rural telephone company
provides video programming. The limitation contained in this
subparagraph shall not apply to a rural telephone company that
is providing video programming on the date of enactment of the
Telecommunications Act of 1996.
``(2) Suspensions and modifications for rural carriers.--A
local exchange carrier with fewer than 2 percent of the Nation's
subscriber lines installed in the aggregate nationwide may petition
a State commission for a suspension or modification of the
application of a requirement or requirements of subsection (b) or
(c) to telephone exchange service facilities specified in such
petition. The State commission shall grant such petition to the
extent that, and for such duration as, the State commission
determines that such suspension or modification--
``(A) is necessary--
``(i) to avoid a significant adverse economic impact on
users of telecommunications services generally;
``(ii) to avoid imposing a requirement that is unduly
economically burdensome; or
``(iii) to avoid imposing a requirement that is
technically infeasible; and
``(B) is consistent with the public interest, convenience,
and necessity.
The State commission shall act upon any petition filed under this
paragraph within 180 days after receiving such petition. Pending
such action, the State commission may suspend enforcement of the
requirement or requirements to which the petition applies with
respect to the petitioning carrier or carriers.
``(g) Continued Enforcement of Exchange Access and Interconnection
Requirements.--On and after the date of enactment of the
Telecommunications Act of 1996, each local exchange carrier, to the
extent that it provides wireline services, shall provide exchange
access, information access, and exchange services for such access to
interexchange carriers and information service providers in accordance
with the same equal access and nondiscriminatory interconnection
restrictions and obligations (including receipt of compensation) that
apply to such carrier on the date immediately preceding the date of
enactment of the Telecommunications Act of 1996 under any court order,
consent decree, or regulation, order, or policy of the Commission,
until such restrictions and obligations are explicitly superseded by
regulations prescribed by the Commission after such date of enactment.
During the period beginning on such date of enactment and until such
restrictions and obligations are so superseded, such restrictions and
obligations shall be enforceable in the same manner as regulations of
the Commission.
``(h) Definition of Incumbent Local Exchange Carrier.--
``(1) Definition.--For purposes of this section, the term
`incumbent local exchange carrier' means, with respect to an area,
the local exchange carrier that--
``(A) on the date of enactment of the Telecommunications
Act of 1996, provided telephone exchange service in such area;
and
``(B)(i) on such date of enactment, was deemed to be a
member of the exchange carrier association pursuant to section
69.601(b) of the Commission's regulations (47 C.F.R.
69.601(b)); or
``(ii) is a person or entity that, on or after such date of
enactment, became a successor or assign of a member described
in clause (i).
``(2) Treatment of comparable carriers as incumbents.--The
Commission may, by rule, provide for the treatment of a local
exchange carrier (or class or category thereof) as an incumbent
local exchange carrier for purposes of this section if--
``(A) such carrier occupies a position in the market for
telephone exchange service within an area that is comparable to
the position occupied by a carrier described in paragraph (1);
``(B) such carrier has substantially replaced an incumbent
local exchange carrier described in paragraph (1); and
``(C) such treatment is consistent with the public
interest, convenience, and necessity and the purposes of this
section.
``(i) Savings Provision.--Nothing in this section shall be
construed to limit or otherwise affect the Commission's authority under
section 201.
``SEC. 252. PROCEDURES FOR NEGOTIATION, ARBITRATION, AND APPROVAL OF
AGREEMENTS.
``(a) Agreements Arrived at Through Negotiation.--
``(1) Voluntary negotiations.--Upon receiving a request for
interconnection, services, or network elements pursuant to section
251, an incumbent local exchange carrier may negotiate and enter
into a binding agreement with the requesting telecommunications
carrier or carriers without regard to the standards set forth in
subsections (b) and (c) of section 251. The agreement shall include
a detailed schedule of itemized charges for interconnection and
each service or network element included in the agreement. The
agreement, including any interconnection agreement negotiated
before the date of enactment of the Telecommunications Act of 1996,
shall be submitted to the State commission under subsection (e) of
this section.
``(2) Mediation.--Any party negotiating an agreement under this
section may, at any point in the negotiation, ask a State
commission to participate in the negotiation and to mediate any
differences arising in the course of the negotiation.
``(b) Agreements Arrived at Through Compulsory Arbitration.--
``(1) Arbitration.--During the period from the 135th to the
160th day (inclusive) after the date on which an incumbent local
exchange carrier receives a request for negotiation under this
section, the carrier or any other party to the negotiation may
petition a State commission to arbitrate any open issues.
``(2) Duty of petitioner.--
``(A) A party that petitions a State commission under
paragraph (1) shall, at the same time as it submits the
petition, provide the State commission all relevant
documentation concerning--
``(i) the unresolved issues;
``(ii) the position of each of the parties with respect
to those issues; and
``(iii) any other issue discussed and resolved by the
parties.
``(B) A party petitioning a State commission under
paragraph (1) shall provide a copy of the petition and any
documentation to the other party or parties not later than the
day on which the State commission receives the petition.
``(3) Opportunity to respond.--A non-petitioning party to a
negotiation under this section may respond to the other party's
petition and provide such additional information as it wishes
within 25 days after the State commission receives the petition.
``(4) Action by state commission.--
``(A) The State commission shall limit its consideration of
any petition under paragraph (1) (and any response thereto) to
the issues set forth in the petition and in the response, if
any, filed under paragraph (3).
``(B) The State commission may require the petitioning
party and the responding party to provide such information as
may be necessary for the State commission to reach a decision
on the unresolved issues. If any party refuses or fails
unreasonably to respond on a timely basis to any reasonable
request from the State commission, then the State commission
may proceed on the basis of the best information available to
it from whatever source derived.
``(C) The State commission shall resolve each issue set
forth in the petition and the response, if any, by imposing
appropriate conditions as required to implement subsection (c)
upon the parties to the agreement, and shall conclude the
resolution of any unresolved issues not later than 9 months
after the date on which the local exchange carrier received the
request under this section.
``(5) Refusal to negotiate.--The refusal of any other party to
the negotiation to participate further in the negotiations, to
cooperate with the State commission in carrying out its function as
an arbitrator, or to continue to negotiate in good faith in the
presence, or with the assistance, of the State commission shall be
considered a failure to negotiate in good faith.
``(c) Standards for Arbitration.--In resolving by arbitration under
subsection (b) any open issues and imposing conditions upon the parties
to the agreement, a State commission shall--
``(1) ensure that such resolution and conditions meet the
requirements of section 251, including the regulations prescribed
by the Commission pursuant to section 251;
``(2) establish any rates for interconnection, services, or
network elements according to subsection (d); and
``(3) provide a schedule for implementation of the terms and
conditions by the parties to the agreement.
``(d) Pricing Standards.--
``(1) Interconnection and network element charges.--
Determinations by a State commission of the just and reasonable
rate for the interconnection of facilities and equipment for
purposes of subsection (c)(2) of section 251, and the just and
reasonable rate for network elements for purposes of subsection
(c)(3) of such section--
``(A) shall be--
``(i) based on the cost (determined without reference
to a rate-of-return or other rate-based proceeding) of
providing the interconnection or network element (whichever
is applicable), and
``(ii) nondiscriminatory, and
``(B) may include a reasonable profit.
``(2) Charges for transport and termination of traffic.--
``(A) In general.--For the purposes of compliance by an
incumbent local exchange carrier with section 251(b)(5), a
State commission shall not consider the terms and conditions
for reciprocal compensation to be just and reasonable unless--
``(i) such terms and conditions provide for the mutual
and reciprocal recovery by each carrier of costs associated
with the transport and termination on each carrier's
network facilities of calls that originate on the network
facilities of the other carrier; and
``(ii) such terms and conditions determine such costs
on the basis of a reasonable approximation of the
additional costs of terminating such calls.
``(B) Rules of construction.--This paragraph shall not be
construed--
``(i) to preclude arrangements that afford the mutual
recovery of costs through the offsetting of reciprocal
obligations, including arrangements that waive mutual
recovery (such as bill-and-keep arrangements); or
``(ii) to authorize the Commission or any State
commission to engage in any rate regulation proceeding to
establish with particularity the additional costs of
transporting or terminating calls, or to require carriers
to maintain records with respect to the additional costs of
such calls.
``(3) Wholesale prices for telecommunications services.--For
the purposes of section 251(c)(4), a State commission shall
determine wholesale rates on the basis of retail rates charged to
subscribers for the telecommunications service requested, excluding
the portion thereof attributable to any marketing, billing,
collection, and other costs that will be avoided by the local
exchange carrier.
``(e) Approval by State Commission.--
``(1) Approval required.--Any interconnection agreement adopted
by negotiation or arbitration shall be submitted for approval to
the State commission. A State commission to which an agreement is
submitted shall approve or reject the agreement, with written
findings as to any deficiencies.
``(2) Grounds for rejection.--The State commission may only
reject--
``(A) an agreement (or any portion thereof) adopted by
negotiation under subsection (a) if it finds that--
``(i) the agreement (or portion thereof) discriminates
against a telecommunications carrier not a party to the
agreement; or
``(ii) the implementation of such agreement or portion
is not consistent with the public interest, convenience,
and necessity; or
``(B) an agreement (or any portion thereof) adopted by
arbitration under subsection (b) if it finds that the agreement
does not meet the requirements of section 251, including the
regulations prescribed by the Commission pursuant to section
251, or the standards set forth in subsection (d) of this
section.
``(3) Preservation of authority.--Notwithstanding paragraph
(2), but subject to section 253, nothing in this section shall
prohibit a State commission from establishing or enforcing other
requirements of State law in its review of an agreement, including
requiring compliance with intrastate telecommunications service
quality standards or requirements.
``(4) Schedule for decision.--If the State commission does not
act to approve or reject the agreement within 90 days after
submission by the parties of an agreement adopted by negotiation
under subsection (a), or within 30 days after submission by the
parties of an agreement adopted by arbitration under subsection
(b), the agreement shall be deemed approved. No State court shall
have jurisdiction to review the action of a State commission in
approving or rejecting an agreement under this section.
``(5) Commission to act if state will not act.--If a State
commission fails to act to carry out its responsibility under this
section in any proceeding or other matter under this section, then
the Commission shall issue an order preempting the State
commission's jurisdiction of that proceeding or matter within 90
days after being notified (or taking notice) of such failure, and
shall assume the responsibility of the State commission under this
section with respect to the proceeding or matter and act for the
State commission.
``(6) Review of state commission actions.--In a case in which a
State fails to act as described in paragraph (5), the proceeding by
the Commission under such paragraph and any judicial review of the
Commission's actions shall be the exclusive remedies for a State
commission's failure to act. In any case in which a State
commission makes a determination under this section, any party
aggrieved by such determination may bring an action in an
appropriate Federal district court to determine whether the
agreement or statement meets the requirements of section 251 and
this section.
``(f) Statements of Generally Available Terms.--
``(1) In general.--A Bell operating company may prepare and
file with a State commission a statement of the terms and
conditions that such company generally offers within that State to
comply with the requirements of section 251 and the regulations
thereunder and the standards applicable under this section.
``(2) State commission review.--A State commission may not
approve such statement unless such statement complies with
subsection (d) of this section and section 251 and the regulations
thereunder. Except as provided in section 253, nothing in this
section shall prohibit a State commission from establishing or
enforcing other requirements of State law in its review of such
statement, including requiring compliance with intrastate
telecommunications service quality standards or requirements.
``(3) Schedule for review.--The State commission to which a
statement is submitted shall, not later than 60 days after the date
of such submission--
``(A) complete the review of such statement under paragraph
(2) (including any reconsideration thereof), unless the
submitting carrier agrees to an extension of the period for
such review; or
``(B) permit such statement to take effect.
``(4) Authority to continue review.--Paragraph (3) shall not
preclude the State commission from continuing to review a statement
that has been permitted to take effect under subparagraph (B) of
such paragraph or from approving or disapproving such statement
under paragraph (2).
``(5) Duty to negotiate not affected.--The submission or
approval of a statement under this subsection shall not relieve a
Bell operating company of its duty to negotiate the terms and
conditions of an agreement under section 251.
``(g) Consolidation of State Proceedings.--Where not inconsistent
with the requirements of this Act, a State commission may, to the
extent practical, consolidate proceedings under sections 214(e),
251(f), 253, and this section in order to reduce administrative burdens
on telecommunications carriers, other parties to the proceedings, and
the State commission in carrying out its responsibilities under this
Act.
``(h) Filing Required.--A State commission shall make a copy of
each agreement approved under subsection (e) and each statement
approved under subsection (f) available for public inspection and
copying within 10 days after the agreement or statement is approved.
The State commission may charge a reasonable and nondiscriminatory fee
to the parties to the agreement or to the party filing the statement to
cover the costs of approving and filing such agreement or statement.
``(i) Availability to Other Telecommunications Carriers.--A local
exchange carrier shall make available any interconnection, service, or
network element provided under an agreement approved under this section
to which it is a party to any other requesting telecommunications
carrier upon the same terms and conditions as those provided in the
agreement.
``(j) Definition of Incumbent Local Exchange Carrier.--For purposes
of this section, the term `incumbent local exchange carrier' has the
meaning provided in section 251(h).
``SEC. 253. REMOVAL OF BARRIERS TO ENTRY.
``(a) In General.--No State or local statute or regulation, or
other State or local legal requirement, may prohibit or have the effect
of prohibiting the ability of any entity to provide any interstate or
intrastate telecommunications service.
``(b) State Regulatory Authority.--Nothing in this section shall
affect the ability of a State to impose, on a competitively neutral
basis and consistent with section 254, requirements necessary to
preserve and advance universal service, protect the public safety and
welfare, ensure the continued quality of telecommunications services,
and safeguard the rights of consumers.
``(c) State and Local Government Authority.--Nothing in this
section affects the authority of a State or local government to manage
the public rights-of-way or to require fair and reasonable compensation
from telecommunications providers, on a competitively neutral and
nondiscriminatory basis, for use of public rights-of-way on a
nondiscriminatory basis, if the compensation required is publicly
disclosed by such government.
``(d) Preemption.--If, after notice and an opportunity for public
comment, the Commission determines that a State or local government has
permitted or imposed any statute, regulation, or legal requirement that
violates subsection (a) or (b), the Commission shall preempt the
enforcement of such statute, regulation, or legal requirement to the
extent necessary to correct such violation or inconsistency.
``(e) Commercial Mobile Service Providers.--Nothing in this section
shall affect the application of section 332(c)(3) to commercial mobile
service providers.
``(f) Rural Markets.--It shall not be a violation of this section
for a State to require a telecommunications carrier that seeks to
provide telephone exchange service or exchange access in a service area
served by a rural telephone company to meet the requirements in section
214(e)(1) for designation as an eligible telecommunications carrier for
that area before being permitted to provide such service. This
subsection shall not apply--
``(1) to a service area served by a rural telephone company
that has obtained an exemption, suspension, or modification of
section 251(c)(4) that effectively prevents a competitor from
meeting the requirements of section 214(e)(1); and
``(2) to a provider of commercial mobile services.
``SEC. 254. UNIVERSAL SERVICE.
``(a) Procedures to Review Universal Service Requirements.--
``(1) Federal-state joint board on universal service.--Within
one month after the date of enactment of the Telecommunications Act
of 1996, the Commission shall institute and refer to a Federal-
State Joint Board under section 410(c) a proceeding to recommend
changes to any of its regulations in order to implement sections
214(e) and this section, including the definition of the services
that are supported by Federal universal service support mechanisms
and a specific timetable for completion of such recommendations. In
addition to the members of the Joint Board required under section
410(c), one member of such Joint Board shall be a State-appointed
utility consumer advocate nominated by a national organization of
State utility consumer advocates. The Joint Board shall, after
notice and opportunity for public comment, make its recommendations
to the Commission 9 months after the date of enactment of the
Telecommunications Act of 1996.
``(2) Commission action.--The Commission shall initiate a
single proceeding to implement the recommendations from the Joint
Board required by paragraph (1) and shall complete such proceeding
within 15 months after the date of enactment of the
Telecommunications Act of 1996. The rules established by such
proceeding shall include a definition of the services that are
supported by Federal universal service support mechanisms and a
specific timetable for implementation. Thereafter, the Commission
shall complete any proceeding to implement subsequent
recommendations from any Joint Board on universal service within
one year after receiving such recommendations.
``(b) Universal Service Principles.--The Joint Board and the
Commission shall base policies for the preservation and advancement of
universal service on the following principles:
``(1) Quality and rates.--Quality services should be available
at just, reasonable, and affordable rates.
``(2) Access to advanced services.--Access to advanced
telecommunications and information services should be provided in
all regions of the Nation.
``(3) Access in rural and high cost areas.--Consumers in all
regions of the Nation, including low-income consumers and those in
rural, insular, and high cost areas, should have access to
telecommunications and information services, including
interexchange services and advanced telecommunications and
information services, that are reasonably comparable to those
services provided in urban areas and that are available at rates
that are reasonably comparable to rates charged for similar
services in urban areas.
``(4) Equitable and nondiscriminatory contributions.--All
providers of telecommunications services should make an equitable
and nondiscriminatory contribution to the preservation and
advancement of universal service.
``(5) Specific and predictable support mechanisms.--There
should be specific, predictable and sufficient Federal and State
mechanisms to preserve and advance universal service.
``(6) Access to advanced telecommunications services for
schools, health care, and libraries.--Elementary and secondary
schools and classrooms, health care providers, and libraries should
have access to advanced telecommunications services as described in
subsection (h).
``(7) Additional principles.--Such other principles as the
Joint Board and the Commission determine are necessary and
appropriate for the protection of the public interest, convenience,
and necessity and are consistent with this Act.
``(c) Definition.--
``(1) In general.--Universal service is an evolving level of
telecommunications services that the Commission shall establish
periodically under this section, taking into account advances in
telecommunications and information technologies and services. The
Joint Board in recommending, and the Commission in establishing,
the definition of the services that are supported by Federal
universal service support mechanisms shall consider the extent to
which such telecommunications services--
``(A) are essential to education, public health, or public
safety;
``(B) have, through the operation of market choices by
customers, been subscribed to by a substantial majority of
residential customers;
``(C) are being deployed in public telecommunications
networks by telecommunications carriers; and
``(D) are consistent with the public interest, convenience,
and necessity.
``(2) Alterations and modifications.--The Joint Board may, from
time to time, recommend to the Commission modifications in the
definition of the services that are supported by Federal universal
service support mechanisms.
``(3) Special services.--In addition to the services included
in the definition of universal service under paragraph (1), the
Commission may designate additional services for such support
mechanisms for schools, libraries, and health care providers for
the purposes of subsection (h).
``(d) Telecommunications Carrier Contribution.--Every
telecommunications carrier that provides interstate telecommunications
services shall contribute, on an equitable and nondiscriminatory basis,
to the specific, predictable, and sufficient mechanisms established by
the Commission to preserve and advance universal service. The
Commission may exempt a carrier or class of carriers from this
requirement if the carrier's telecommunications activities are limited
to such an extent that the level of such carrier's contribution to the
preservation and advancement of universal service would be de minimis.
Any other provider of interstate telecommunications may be required to
contribute to the preservation and advancement of universal service if
the public interest so requires.
``(e) Universal Service Support.--After the date on which
Commission regulations implementing this section take effect, only an
eligible telecommunications carrier designated under section 214(e)
shall be eligible to receive specific Federal universal service
support. A carrier that receives such support shall use that support
only for the provision, maintenance, and upgrading of facilities and
services for which the support is intended. Any such support should be
explicit and sufficient to achieve the purposes of this section.
``(f) State Authority.--A State may adopt regulations not
inconsistent with the Commission's rules to preserve and advance
universal service. Every telecommunications carrier that provides
intrastate telecommunications services shall contribute, on an
equitable and nondiscriminatory basis, in a manner determined by the
State to the preservation and advancement of universal service in that
State. A State may adopt regulations to provide for additional
definitions and standards to preserve and advance universal service
within that State only to the extent that such regulations adopt
additional specific, predictable, and sufficient mechanisms to support
such definitions or standards that do not rely on or burden Federal
universal service support mechanisms.
``(g) Interexchange and Interstate Services.--Within 6 months after
the date of enactment of the Telecommunications Act of 1996, the
Commission shall adopt rules to require that the rates charged by
providers of interexchange telecommunications services to subscribers
in rural and high cost areas shall be no higher than the rates charged
by each such provider to its subscribers in urban areas. Such rules
shall also require that a provider of interstate interexchange
telecommunications services shall provide such services to its
subscribers in each State at rates no higher than the rates charged to
its subscribers in any other State.
``(h) Telecommunications Services for Certain Providers.--
``(1) In general.--
``(A) Health care providers for rural areas.--A
telecommunications carrier shall, upon receiving a bona fide
request, provide telecommunications services which are
necessary for the provision of health care services in a State,
including instruction relating to such services, to any public
or nonprofit health care provider that serves persons who
reside in rural areas in that State at rates that are
reasonably comparable to rates charged for similar services in
urban areas in that State. A telecommunications carrier
providing service under this paragraph shall be entitled to
have an amount equal to the difference, if any, between the
rates for services provided to health care providers for rural
areas in a State and the rates for similar services provided to
other customers in comparable rural areas in that State treated
as a service obligation as a part of its obligation to
participate in the mechanisms to preserve and advance universal
service.
``(B) Educational providers and libraries.--All
telecommunications carriers serving a geographic area shall,
upon a bona fide request for any of its services that are
within the definition of universal service under subsection
(c)(3), provide such services to elementary schools, secondary
schools, and libraries for educational purposes at rates less
than the amounts charged for similar services to other parties.
The discount shall be an amount that the Commission, with
respect to interstate services, and the States, with respect to
intrastate services, determine is appropriate and necessary to
ensure affordable access to and use of such services by such
entities. A telecommunications carrier providing service under
this paragraph shall--
``(i) have an amount equal to the amount of the
discount treated as an offset to its obligation to
contribute to the mechanisms to preserve and advance
universal service, or
``(ii) notwithstanding the provisions of subsection (e)
of this section, receive reimbursement utilizing the
support mechanisms to preserve and advance universal
service.
``(2) Advanced services.--The Commission shall establish
competitively neutral rules--
``(A) to enhance, to the extent technically feasible and
economically reasonable, access to advanced telecommunications
and information services for all public and nonprofit
elementary and secondary school classrooms, health care
providers, and libraries; and
``(B) to define the circumstances under which a
telecommunications carrier may be required to connect its
network to such public institutional telecommunications users.
``(3) Terms and conditions.--Telecommunications services and
network capacity provided to a public institutional
telecommunications user under this subsection may not be sold,
resold, or otherwise transferred by such user in consideration for
money or any other thing of value.
``(4) Eligibility of users.--No entity listed in this
subsection shall be entitled to preferential rates or treatment as
required by this subsection, if such entity operates as a for-
profit business, is a school described in paragraph (5)(A) with an
endowment of more than $50,000,000, or is a library not eligible
for participation in State-based plans for funds under title III of
the Library Services and Construction Act (20 U.S.C. 335c et seq.).
``(5) Definitions.--For purposes of this subsection:
``(A) Elementary and secondary schools.--The term
`elementary and secondary schools' means elementary schools and
secondary schools, as defined in paragraphs (14) and (25),
respectively, of section 14101 of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 8801).
``(B) Health care provider.--The term `health care
provider' means--
``(i) post-secondary educational institutions offering
health care instruction, teaching hospitals, and medical
schools;
``(ii) community health centers or health centers
providing health care to migrants;
``(iii) local health departments or agencies;
``(iv) community mental health centers;
``(v) not-for-profit hospitals;
``(vi) rural health clinics; and
``(vii) consortia of health care providers consisting
of one or more entities described in clauses (i) through
(vi).
``(C) Public institutional telecommunications user.--The
term `public institutional telecommunications user' means an
elementary or secondary school, a library, or a health care
provider as those terms are defined in this paragraph.
``(i) Consumer Protection.--The Commission and the States should
ensure that universal service is available at rates that are just,
reasonable, and affordable.
``(j) Lifeline Assistance.--Nothing in this section shall affect
the collection, distribution, or administration of the Lifeline
Assistance Program provided for by the Commission under regulations set
forth in section 69.117 of title 47, Code of Federal Regulations, and
other related sections of such title.
``(k) Subsidy of Competitive Services Prohibited.--A
telecommunications carrier may not use services that are not
competitive to subsidize services that are subject to competition. The
Commission, with respect to interstate services, and the States, with
respect to intrastate services, shall establish any necessary cost
allocation rules, accounting safeguards, and guidelines to ensure that
services included in the definition of universal service bear no more
than a reasonable share of the joint and common costs of facilities
used to provide those services.
``SEC. 255. ACCESS BY PERSONS WITH DISABILITIES.
``(a) Definitions.--As used in this section--
``(1) Disability.--The term `disability' has the meaning given
to it by section 3(2)(A) of the Americans with Disabilities Act of
1990 (42 U.S.C. 12102(2)(A)).
``(2) Readily achievable.--The term `readily achievable' has
the meaning given to it by section 301(9) of that Act (42 U.S.C.
12181(9)).
``(b) Manufacturing.--A manufacturer of telecommunications
equipment or customer premises equipment shall ensure that the
equipment is designed, developed, and fabricated to be accessible to
and usable by individuals with disabilities, if readily achievable.
``(c) Telecommunications Services.--A provider of
telecommunications service shall ensure that the service is accessible
to and usable by individuals with disabilities, if readily achievable.
``(d) Compatibility.--Whenever the requirements of subsections (b)
and (c) are not readily achievable, such a manufacturer or provider
shall ensure that the equipment or service is compatible with existing
peripheral devices or specialized customer premises equipment commonly
used by individuals with disabilities to achieve access, if readily
achievable.
``(e) Guidelines.--Within 18 months after the date of enactment of
the Telecommunications Act of 1996, the Architectural and
Transportation Barriers Compliance Board shall develop guidelines for
accessibility of telecommunications equipment and customer premises
equipment in conjunction with the Commission. The Board shall review
and update the guidelines periodically.
``(f) No Additional Private Rights Authorized.--Nothing in this
section shall be construed to authorize any private right of action to
enforce any requirement of this section or any regulation thereunder.
The Commission shall have exclusive jurisdiction with respect to any
complaint under this section.
``SEC. 256. COORDINATION FOR INTERCONNECTIVITY.
``(a) Purpose.--It is the purpose of this section--
``(1) to promote nondiscriminatory accessibility by the
broadest number of users and vendors of communications products and
services to public telecommunications networks used to provide
telecommunications service through--
``(A) coordinated public telecommunications network
planning and design by telecommunications carriers and other
providers of telecommunications service; and
``(B) public telecommunications network interconnectivity,
and interconnectivity of devices with such networks used to
provide telecommunications service; and
``(2) to ensure the ability of users and information providers
to seamlessly and transparently transmit and receive information
between and across telecommunications networks.
``(b) Commission Functions.--In carrying out the purposes of this
section, the Commission--
``(1) shall establish procedures for Commission oversight of
coordinated network planning by telecommunications carriers and
other providers of telecommunications service for the effective and
efficient interconnection of public telecommunications networks
used to provide telecommunications service; and
``(2) may participate, in a manner consistent with its
authority and practice prior to the date of enactment of this
section, in the development by appropriate industry standards-
setting organizations of public telecommunications network
interconnectivity standards that promote access to--
``(A) public telecommunications networks used to provide
telecommunications service;
``(B) network capabilities and services by individuals with
disabilities; and
``(C) information services by subscribers of rural
telephone companies.
``(c) Commission's Authority.--Nothing in this section shall be
construed as expanding or limiting any authority that the Commission
may have under law in effect before the date of enactment of the
Telecommunications Act of 1996.
``(d) Definition.--As used in this section, the term `public
telecommunications network interconnectivity' means the ability of two
or more public telecommunications networks used to provide
telecommunications service to communicate and exchange information
without degeneration, and to interact in concert with one another.
``SEC. 257. MARKET ENTRY BARRIERS PROCEEDING.
``(a) Elimination of Barriers.--Within 15 months after the date of
enactment of the Telecommunications Act of 1996, the Commission shall
complete a proceeding for the purpose of identifying and eliminating,
by regulations pursuant to its authority under this Act (other than
this section), market entry barriers for entrepreneurs and other small
businesses in the provision and ownership of telecommunications
services and information services, or in the provision of parts or
services to providers of telecommunications services and information
services.
``(b) National Policy.--In carrying out subsection (a), the
Commission shall seek to promote the policies and purposes of this Act
favoring diversity of media voices, vigorous economic competition,
technological advancement, and promotion of the public interest,
convenience, and necessity.
``(c) Periodic Review.--Every 3 years following the completion of
the proceeding required by subsection (a), the Commission shall review
and report to Congress on--
``(1) any regulations prescribed to eliminate barriers within
its jurisdiction that are identified under subsection (a) and that
can be prescribed consistent with the public interest, convenience,
and necessity; and
``(2) the statutory barriers identified under subsection (a)
that the Commission recommends be eliminated, consistent with the
public interest, convenience, and necessity.
``SEC. 258. ILLEGAL CHANGES IN SUBSCRIBER CARRIER SELECTIONS.
``(a) Prohibition.--No telecommunications carrier shall submit or
execute a change in a subscriber's selection of a provider of telephone
exchange service or telephone toll service except in accordance with
such verification procedures as the Commission shall prescribe. Nothing
in this section shall preclude any State commission from enforcing such
procedures with respect to intrastate services.
``(b) Liability for Charges.--Any telecommunications carrier that
violates the verification procedures described in subsection (a) and
that collects charges for telephone exchange service or telephone toll
service from a subscriber shall be liable to the carrier previously
selected by the subscriber in an amount equal to all charges paid by
such subscriber after such violation, in accordance with such
procedures as the Commission may prescribe. The remedies provided by
this subsection are in addition to any other remedies available by law.
``SEC. 259. INFRASTRUCTURE SHARING.
``(a) Regulations Required.--The Commission shall prescribe, within
one year after the date of enactment of the Telecommunications Act of
1996, regulations that require incumbent local exchange carriers (as
defined in section 251(h)) to make available to any qualifying carrier
such public switched network infrastructure, technology, information,
and telecommunications facilities and functions as may be requested by
such qualifying carrier for the purpose of enabling such qualifying
carrier to provide telecommunications services, or to provide access to
information services, in the service area in which such qualifying
carrier has requested and obtained designation as an eligible
telecommunications carrier under section 214(e).
``(b) Terms and Conditions of Regulations.--The regulations
prescribed by the Commission pursuant to this section shall--
``(1) not require a local exchange carrier to which this
section applies to take any action that is economically
unreasonable or that is contrary to the public interest;
``(2) permit, but shall not require, the joint ownership or
operation of public switched network infrastructure and services by
or among such local exchange carrier and a qualifying carrier;
``(3) ensure that such local exchange carrier will not be
treated by the Commission or any State as a common carrier for hire
or as offering common carrier services with respect to any
infrastructure, technology, information, facilities, or functions
made available to a qualifying carrier in accordance with
regulations issued pursuant to this section;
``(4) ensure that such local exchange carrier makes such
infrastructure, technology, information, facilities, or functions
available to a qualifying carrier on just and reasonable terms and
conditions that permit such qualifying carrier to fully benefit
from the economies of scale and scope of such local exchange
carrier, as determined in accordance with guidelines prescribed by
the Commission in regulations issued pursuant to this section;
``(5) establish conditions that promote cooperation between
local exchange carriers to which this section applies and
qualifying carriers;
``(6) not require a local exchange carrier to which this
section applies to engage in any infrastructure sharing agreement
for any services or access which are to be provided or offered to
consumers by the qualifying carrier in such local exchange
carrier's telephone exchange area; and
``(7) require that such local exchange carrier file with the
Commission or State for public inspection, any tariffs, contracts,
or other arrangements showing the rates, terms, and conditions
under which such carrier is making available public switched
network infrastructure and functions under this section.
``(c) Information Concerning Deployment of New Services and
Equipment.--A local exchange carrier to which this section applies that
has entered into an infrastructure sharing agreement under this section
shall provide to each party to such agreement timely information on the
planned deployment of telecommunications services and equipment,
including any software or upgrades of software integral to the use or
operation of such telecommunications equipment.
``(d) Definition.--For purposes of this section, the term
`qualifying carrier' means a telecommunications carrier that--
``(1) lacks economies of scale or scope, as determined in
accordance with regulations prescribed by the Commission pursuant
to this section; and
``(2) offers telephone exchange service, exchange access, and
any other service that is included in universal service, to all
consumers without preference throughout the service area for which
such carrier has been designated as an eligible telecommunications
carrier under section 214(e).
``SEC. 260. PROVISION OF TELEMESSAGING SERVICE.
``(a) Nondiscrimination Safeguards.--Any local exchange carrier
subject to the requirements of section 251(c) that provides
telemessaging service--
``(1) shall not subsidize its telemessaging service directly or
indirectly from its telephone exchange service or its exchange
access; and
``(2) shall not prefer or discriminate in favor of its
telemessaging service operations in its provision of
telecommunications services.
``(b) Expedited Consideration of Complaints.--The Commission shall
establish procedures for the receipt and review of complaints
concerning violations of subsection (a) or the regulations thereunder
that result in material financial harm to a provider of telemessaging
service. Such procedures shall ensure that the Commission will make a
final determination with respect to any such complaint within 120 days
after receipt of the complaint. If the complaint contains an
appropriate showing that the alleged violation occurred, the Commission
shall, within 60 days after receipt of the complaint, order the local
exchange carrier and any affiliates to cease engaging in such violation
pending such final determination.
``(c) Definition.--As used in this section, the term `telemessaging
service' means voice mail and voice storage and retrieval services, any
live operator services used to record, transcribe, or relay messages
(other than telecommunications relay services), and any ancillary
services offered in combination with these services.
``SEC. 261. EFFECT ON OTHER REQUIREMENTS.
``(a) Commission Regulations.--Nothing in this part shall be
construed to prohibit the Commission from enforcing regulations
prescribed prior to the date of enactment of the Telecommunications Act
of 1996 in fulfilling the requirements of this part, to the extent that
such regulations are not inconsistent with the provisions of this part.
``(b) Existing State Regulations.--Nothing in this part shall be
construed to prohibit any State commission from enforcing regulations
prescribed prior to the date of enactment of the Telecommunications Act
of 1996, or from prescribing regulations after such date of enactment,
in fulfilling the requirements of this part, if such regulations are
not inconsistent with the provisions of this part.
``(c) Additional State Requirements.--Nothing in this part
precludes a State from imposing requirements on a telecommunications
carrier for intrastate services that are necessary to further
competition in the provision of telephone exchange service or exchange
access, as long as the State's requirements are not inconsistent with
this part or the Commission's regulations to implement this part.''.
(b) Designation of Part I.--Title II of the Act is further amended
by inserting before the heading of section 201 the following new
heading:
``PART I--COMMON CARRIER REGULATION''.
(c) Stylistic Consistency.--The Act is amended so that--
(1) the designation and heading of each title of the Act shall
be in the form and typeface of the designation and heading of this
title of this Act; and
(2) the designation and heading of each part of each title of
the Act shall be in the form and typeface of the designation and
heading of part I of title II of the Act, as amended by subsection
(a).
SEC. 102. ELIGIBLE TELECOMMUNICATIONS CARRIERS.
(a) In General.--Section 214 (47 U.S.C. 214) is amended by adding
at the end thereof the following new subsection:
``(e) Provision of Universal Service.--
``(1) Eligible telecommunications carriers.--A common carrier
designated as an eligible telecommunications carrier under
paragraph (2) or (3) shall be eligible to receive universal service
support in accordance with section 254 and shall, throughout the
service area for which the designation is received--
``(A) offer the services that are supported by Federal
universal service support mechanisms under section 254(c),
either using its own facilities or a combination of its own
facilities and resale of another carrier's services (including
the services offered by another eligible telecommunications
carrier); and
``(B) advertise the availability of such services and the
charges therefor using media of general distribution.
``(2) Designation of eligible telecommunications carriers.--A
State commission shall upon its own motion or upon request
designate a common carrier that meets the requirements of paragraph
(1) as an eligible telecommunications carrier for a service area
designated by the State commission. Upon request and consistent
with the public interest, convenience, and necessity, the State
commission may, in the case of an area served by a rural telephone
company, and shall, in the case of all other areas, designate more
than one common carrier as an eligible telecommunications carrier
for a service area designated by the State commission, so long as
each additional requesting carrier meets the requirements of
paragraph (1). Before designating an additional eligible
telecommunications carrier for an area served by a rural telephone
company, the State commission shall find that the designation is in
the public interest.
``(3) Designation of eligible telecommunications carriers for
unserved areas.--If no common carrier will provide the services
that are supported by Federal universal service support mechanisms
under section 254(c) to an unserved community or any portion
thereof that requests such service, the Commission, with respect to
interstate services, or a State commission, with respect to
intrastate services, shall determine which common carrier or
carriers are best able to provide such service to the requesting
unserved community or portion thereof and shall order such carrier
or carriers to provide such service for that unserved community or
portion thereof. Any carrier or carriers ordered to provide such
service under this paragraph shall meet the requirements of
paragraph (1) and shall be designated as an eligible
telecommunications carrier for that community or portion thereof.
``(4) Relinquishment of universal service.--A State commission
shall permit an eligible telecommunications carrier to relinquish
its designation as such a carrier in any area served by more than
one eligible telecommunications carrier. An eligible
telecommunications carrier that seeks to relinquish its eligible
telecommunications carrier designation for an area served by more
than one eligible telecommunications carrier shall give advance
notice to the State commission of such relinquishment. Prior to
permitting a telecommunications carrier designated as an eligible
telecommunications carrier to cease providing universal service in
an area served by more than one eligible telecommunications
carrier, the State commission shall require the remaining eligible
telecommunications carrier or carriers to ensure that all customers
served by the relinquishing carrier will continue to be served, and
shall require sufficient notice to permit the purchase or
construction of adequate facilities by any remaining eligible
telecommunications carrier. The State commission shall establish a
time, not to exceed one year after the State commission approves
such relinquishment under this paragraph, within which such
purchase or construction shall be completed.
``(5) Service area defined.--The term `service area' means a
geographic area established by a State commission for the purpose
of determining universal service obligations and support
mechanisms. In the case of an area served by a rural telephone
company, `service area' means such company's `study area' unless
and until the Commission and the States, after taking into account
recommendations of a Federal-State Joint Board instituted under
section 410(c), establish a different definition of service area
for such company.''.
SEC. 103. EXEMPT TELECOMMUNICATIONS COMPANIES.
The Public Utility Holding Company Act of 1935 (15 U.S.C. 79 and
following) is amended by redesignating sections 34 and 35 as sections
35 and 36, respectively, and by inserting the following new section
after section 33:
``SEC. 34. EXEMPT TELECOMMUNICATIONS COMPANIES.
``(a) Definitions.--For purposes of this section--
``(1) Exempt telecommunications company.--The term `exempt
telecommunications company' means any person determined by the
Federal Communications Commission to be engaged directly or
indirectly, wherever located, through one or more affiliates (as
defined in section 2(a)(11)(B)), and exclusively in the business of
providing---
``(A) telecommunications services;
``(B) information services;
``(C) other services or products subject to the
jurisdiction of the Federal Communications Commission; or
``(D) products or services that are related or incidental
to the provision of a product or service described in
subparagraph (A), (B), or (C).
No person shall be deemed to be an exempt telecommunications
company under this section unless such person has applied to the
Federal Communications Commission for a determination under this
paragraph. A person applying in good faith for such a determination
shall be deemed an exempt telecommunications company under this
section, with all of the exemptions provided by this section, until
the Federal Communications Commission makes such determination. The
Federal Communications Commission shall make such determination
within 60 days of its receipt of any such application filed after
the enactment of this section and shall notify the Commission
whenever a determination is made under this paragraph that any
person is an exempt telecommunications company. Not later than 12
months after the date of enactment of this section, the Federal
Communications Commission shall promulgate rules implementing the
provisions of this paragraph which shall be applicable to
applications filed under this paragraph after the effective date of
such rules.
``(2) Other terms.--For purposes of this section, the terms
`telecommunications services' and `information services' shall have
the same meanings as provided in the Communications Act of 1934.
``(b) State Consent for Sale of Existing Rate-Based Facilities.--If
a rate or charge for the sale of electric energy or natural gas (other
than any portion of a rate or charge which represents recovery of the
cost of a wholesale rate or charge) for, or in connection with, assets
of a public utility company that is an associate company or affiliate
of a registered holding company was in effect under the laws of any
State as of December 19, 1995, the public utility company owning such
assets may not sell such assets to an exempt telecommunications company
that is an associate company or affiliate unless State commissions
having jurisdiction over such public utility company approve such sale.
Nothing in this subsection shall preempt the otherwise applicable
authority of any State to approve or disapprove the sale of such
assets. The approval of the Commission under this Act shall not be
required for the sale of assets as provided in this subsection.
``(c) Ownership of ETCS by Exempt Holding Companies.--
Notwithstanding any provision of this Act, a holding company that is
exempt under section 3 of this Act shall be permitted, without
condition or limitation under this Act, to acquire and maintain an
interest in the business of one or more exempt telecommunications
companies.
``(d) Ownership of ETCS by Registered Holding Companies.--
Notwithstanding any provision of this Act, a registered holding company
shall be permitted (without the need to apply for, or receive, approval
from the Commission, and otherwise without condition under this Act) to
acquire and hold the securities, or an interest in the business, of one
or more exempt telecommunications companies.
``(e) Financing and Other Relationships Between ETCS and Registered
Holding Companies.--The relationship between an exempt
telecommunications company and a registered holding company, its
affiliates and associate companies, shall remain subject to the
jurisdiction of the Commission under this Act: Provided, That--
``(1) section 11 of this Act shall not prohibit the ownership
of an interest in the business of one or more exempt
telecommunications companies by a registered holding company
(regardless of activities engaged in or where facilities owned or
operated by such exempt telecommunications companies are located),
and such ownership by a registered holding company shall be deemed
consistent with the operation of an integrated public utility
system;
``(2) the ownership of an interest in the business of one or
more exempt telecommunications companies by a registered holding
company (regardless of activities engaged in or where facilities
owned or operated by such exempt telecommunications companies are
located) shall be considered as reasonably incidental, or
economically necessary or appropriate, to the operations of an
integrated public utility system;
``(3) the Commission shall have no jurisdiction under this Act
over, and there shall be no restriction or approval required under
this Act with respect to (A) the issue or sale of a security by a
registered holding company for purposes of financing the
acquisition of an exempt telecommunications company, or (B) the
guarantee of a security of an exempt telecommunications company by
a registered holding company; and
``(4) except for costs that should be fairly and equitably
allocated among companies that are associate companies of a
registered holding company, the Commission shall have no
jurisdiction under this Act over the sales, service, and
construction contracts between an exempt telecommunications company
and a registered holding company, its affiliates and associate
companies.
``(f) Reporting Obligations Concerning Investments and Activities
of Registered Public-Utility Holding Company Systems.--
``(1) Obligations to report information.--Any registered
holding company or subsidiary thereof that acquires or holds the
securities, or an interest in the business, of an exempt
telecommunications company shall file with the Commission such
information as the Commission, by rule, may prescribe concerning--
``(A) investments and activities by the registered holding
company, or any subsidiary thereof, with respect to exempt
telecommunications companies, and
``(B) any activities of an exempt telecommunications
company within the holding company system,
that are reasonably likely to have a material impact on the
financial or operational condition of the holding company system.
``(2) Authority to require additional information.--If, based
on reports provided to the Commission pursuant to paragraph (1) of
this subsection or other available information, the Commission
reasonably concludes that it has concerns regarding the financial
or operational condition of any registered holding company or any
subsidiary thereof (including an exempt telecommunications
company), the Commission may require such registered holding
company to make additional reports and provide additional
information.
``(3) Authority to limit disclosure of information.--
Notwithstanding any other provision of law, the Commission shall
not be compelled to disclose any information required to be
reported under this subsection. Nothing in this subsection shall
authorize the Commission to withhold the information from Congress,
or prevent the Commission from complying with a request for
information from any other Federal or State department or agency
requesting the information for purposes within the scope of its
jurisdiction. For purposes of section 552 of title 5, United States
Code, this subsection shall be considered a statute described in
subsection (b)(3)(B) of such section 552.
``(g) Assumption of Liabilities.--Any public utility company that
is an associate company, or an affiliate, of a registered holding
company and that is subject to the jurisdiction of a State commission
with respect to its retail electric or gas rates shall not issue any
security for the purpose of financing the acquisition, ownership, or
operation of an exempt telecommunications company. Any public utility
company that is an associate company, or an affiliate, of a registered
holding company and that is subject to the jurisdiction of a State
commission with respect to its retail electric or gas rates shall not
assume any obligation or liability as guarantor, endorser, surety, or
otherwise by the public utility company in respect of any security of
an exempt telecommunications company.
``(h) Pledging or Mortgaging of Assets.--Any public utility company
that is an associate company, or affiliate, of a registered holding
company and that is subject to the jurisdiction of a State commission
with respect to its retail electric or gas rates shall not pledge,
mortgage, or otherwise use as collateral any assets of the public
utility company or assets of any subsidiary company thereof for the
benefit of an exempt telecommunications company.
``(i) Protection Against Abusive Affiliate Transactions.--A public
utility company may enter into a contract to purchase services or
products described in subsection (a)(1) from an exempt
telecommunications company that is an affiliate or associate company of
the public utility company only if--
``(1) every State commission having jurisdiction over the
retail rates of such public utility company approves such contract;
or
``(2) such public utility company is not subject to State
commission retail rate regulation and the purchased services or
products--
``(A) would not be resold to any affiliate or associate
company; or
``(B) would be resold to an affiliate or associate company
and every State commission having jurisdiction over the retail
rates of such affiliate or associate company makes the
determination required by subparagraph (A).
The requirements of this subsection shall not apply in any case in
which the State or the State commission concerned publishes a notice
that the State or State commission waives its authority under this
subsection.
``(j) Nonpreemption of Rate Authority.--Nothing in this Act shall
preclude the Federal Energy Regulatory Commission or a State commission
from exercising its jurisdiction under otherwise applicable law to
determine whether a public utility company may recover in rates the
costs of products or services purchased from or sold to an associate
company or affiliate that is an exempt telecommunications company,
regardless of whether such costs are incurred through the direct or
indirect purchase or sale of products or services from such associate
company or affiliate.
``(k) Reciprocal Arrangements Prohibited.--Reciprocal arrangements
among companies that are not affiliates or associate companies of each
other that are entered into in order to avoid the provisions of this
section are prohibited.
``(l) Books and Records.--(1) Upon written order of a State
commission, a State commission may examine the books, accounts,
memoranda, contracts, and records of--
``(A) a public utility company subject to its regulatory
authority under State law;
``(B) any exempt telecommunications company selling products or
services to such public utility company or to an associate company
of such public utility company; and
``(C) any associate company or affiliate of an exempt
telecommunications company which sells products or services to a
public utility company referred to in subparagraph (A),
wherever located, if such examination is required for the effective
discharge of the State commission's regulatory responsibilities
affecting the provision of electric or gas service in connection with
the activities of such exempt telecommunications company.
``(2) Where a State commission issues an order pursuant to
paragraph (1), the State commission shall not publicly disclose trade
secrets or sensitive commercial information.
``(3) Any United States district court located in the State in
which the State commission referred to in paragraph (1) is located
shall have jurisdiction to enforce compliance with this subsection.
``(4) Nothing in this section shall--
``(A) preempt applicable State law concerning the provision of
records and other information; or
``(B) in any way limit rights to obtain records and other
information under Federal law, contracts, or otherwise.
``(m) Independent Audit Authority for State Commissions.--
``(1) State may order audit.--Any State commission with
jurisdiction over a public utility company that--
``(A) is an associate company of a registered holding
company; and
``(B) transacts business, directly or indirectly, with a
subsidiary company, an affiliate or an associate company that
is an exempt telecommunications company,
may order an independent audit to be performed, no more frequently
than on an annual basis, of all matters deemed relevant by the
selected auditor that reasonably relate to retail rates: Provided,
That such matters relate, directly or indirectly, to transactions
or transfers between the public utility company subject to its
jurisdiction and such exempt telecommunications company.
``(2) Selection of firm to conduct audit.--(A) If a State
commission orders an audit in accordance with paragraph (1), the
public utility company and the State commission shall jointly
select, within 60 days, a firm to perform the audit. The firm
selected to perform the audit shall possess demonstrated
qualifications relating to--
``(i) competency, including adequate technical training and
professional proficiency in each discipline necessary to carry
out the audit; and
``(ii) independence and objectivity, including that the
firm be free from personal or external impairments to
independence, and should assume an independent position with
the State commission and auditee, making certain that the audit
is based upon an impartial consideration of all pertinent facts
and responsible opinions.
``(B) The public utility company and the exempt
telecommunications company shall cooperate fully with all
reasonable requests necessary to perform the audit and the public
utility company shall bear all costs of having the audit performed.
``(3) Availability of auditor's report.--The auditor's report
shall be provided to the State commission not later than 6 months
after the selection of the auditor, and provided to the public
utility company not later than 60 days thereafter.
``(n) Applicability of Telecommunications Regulation.--Nothing in
this section shall affect the authority of the Federal Communications
Commission under the Communications Act of 1934, or the authority of
State commissions under State laws concerning the provision of
telecommunications services, to regulate the activities of an exempt
telecommunications company.''.
SEC. 104. NONDISCRIMINATION PRINCIPLE.
Section 1 (47 U.S.C. 151) is amended by inserting after ``to all
the people of the United States'' the following: ``, without
discrimination on the basis of race, color, religion, national origin,
or sex,''.
Subtitle B--Special Provisions Concerning Bell Operating Companies
SEC. 151. BELL OPERATING COMPANY PROVISIONS.
(a) Establishment of Part III of Title II.--Title II is amended by
adding at the end of part II (as added by section 101) the following
new part:
``PART III--SPECIAL PROVISIONS CONCERNING BELL OPERATING COMPANIES
``SEC. 271. BELL OPERATING COMPANY ENTRY INTO INTERLATA SERVICES.
``(a) General Limitation.--Neither a Bell operating company, nor
any affiliate of a Bell operating company, may provide interLATA
services except as provided in this section.
``(b) InterLATA Services to Which This Section Applies.--
``(1) In-region services.--A Bell operating company, or any
affiliate of that Bell operating company, may provide interLATA
services originating in any of its in-region States (as defined in
subsection (i)) if the Commission approves the application of such
company for such State under subsection (d)(3).
``(2) Out-of-region services.--A Bell operating company, or any
affiliate of that Bell operating company, may provide interLATA
services originating outside its in-region States after the date of
enactment of the Telecommunications Act of 1996, subject to
subsection (j).
``(3) Incidental interlata services.--A Bell operating company,
or any affiliate of a Bell operating company, may provide
incidental interLATA services (as defined in subsection (g))
originating in any State after the date of enactment of the
Telecommunications Act of 1996.
``(4) Termination.--Nothing in this section prohibits a Bell
operating company or any of its affiliates from providing
termination for interLATA services, subject to subsection (j).
``(c) Requirements for Providing Certain In-Region InterLATA
Services.--
``(1) Agreement or statement.--A Bell operating company meets
the requirements of this paragraph if it meets the requirements of
subparagraph (A) or subparagraph (B) of this paragraph for each
State for which the authorization is sought.
``(A) Presence of a facilities-based competitor.--A Bell
operating company meets the requirements of this subparagraph
if it has entered into one or more binding agreements that have
been approved under section 252 specifying the terms and
conditions under which the Bell operating company is providing
access and interconnection to its network facilities for the
network facilities of one or more unaffiliated competing
providers of telephone exchange service (as defined in section
3(47)(A), but excluding exchange access) to residential and
business subscribers. For the purpose of this subparagraph,
such telephone exchange service may be offered by such
competing providers either exclusively over their own telephone
exchange service facilities or predominantly over their own
telephone exchange service facilities in combination with the
resale of the telecommunications services of another carrier.
For the purpose of this subparagraph, services provided
pursuant to subpart K of part 22 of the Commission's
regulations (47 C.F.R. 22.901 et seq.) shall not be considered
to be telephone exchange services.
``(B) Failure to request access.--A Bell operating company
meets the requirements of this subparagraph if, after 10 months
after the date of enactment of the Telecommunications Act of
1996, no such provider has requested the access and
interconnection described in subparagraph (A) before the date
which is 3 months before the date the company makes its
application under subsection (d)(1), and a statement of the
terms and conditions that the company generally offers to
provide such access and interconnection has been approved or
permitted to take effect by the State commission under section
252(f). For purposes of this subparagraph, a Bell operating
company shall be considered not to have received any request
for access and interconnection if the State commission of such
State certifies that the only provider or providers making such
a request have (i) failed to negotiate in good faith as
required by section 252, or (ii) violated the terms of an
agreement approved under section 252 by the provider's failure
to comply, within a reasonable period of time, with the
implementation schedule contained in such agreement.
``(2) Specific interconnection requirements.--
``(A) Agreement required.--A Bell operating company meets
the requirements of this paragraph if, within the State for
which the authorization is sought--
``(i)(I) such company is providing access and
interconnection pursuant to one or more agreements
described in paragraph (1)(A), or
``(II) such company is generally offering access and
interconnection pursuant to a statement described in
paragraph (1)(B), and
``(ii) such access and interconnection meets the
requirements of subparagraph (B) of this paragraph.
``(B) Competitive checklist.--Access or interconnection
provided or generally offered by a Bell operating company to
other telecommunications carriers meets the requirements of
this subparagraph if such access and interconnection includes
each of the following:
``(i) Interconnection in accordance with the
requirements of sections 251(c)(2) and 252(d)(1).
``(ii) Nondiscriminatory access to network elements in
accordance with the requirements of sections 251(c)(3) and
252(d)(1).
``(iii) Nondiscriminatory access to the poles, ducts,
conduits, and rights-of-way owned or controlled by the Bell
operating company at just and reasonable rates in
accordance with the requirements of section 224.
``(iv) Local loop transmission from the central office
to the customer's premises, unbundled from local switching
or other services.
``(v) Local transport from the trunk side of a wireline
local exchange carrier switch unbundled from switching or
other services.
``(vi) Local switching unbundled from transport, local
loop transmission, or other services.
``(vii) Nondiscriminatory access to--
``(I) 911 and E911 services;
``(II) directory assistance services to allow the
other carrier's customers to obtain telephone numbers;
and
``(III) operator call completion services.
``(viii) White pages directory listings for customers
of the other carrier's telephone exchange service.
``(ix) Until the date by which telecommunications
numbering administration guidelines, plan, or rules are
established, nondiscriminatory access to telephone numbers
for assignment to the other carrier's telephone exchange
service customers. After that date, compliance with such
guidelines, plan, or rules.
``(x) Nondiscriminatory access to databases and
associated signaling necessary for call routing and
completion.
``(xi) Until the date by which the Commission issues
regulations pursuant to section 251 to require number
portability, interim telecommunications number portability
through remote call forwarding, direct inward dialing
trunks, or other comparable arrangements, with as little
impairment of functioning, quality, reliability, and
convenience as possible. After that date, full compliance
with such regulations.
``(xii) Nondiscriminatory access to such services or
information as are necessary to allow the requesting
carrier to implement local dialing parity in accordance
with the requirements of section 251(b)(3).
``(xiii) Reciprocal compensation arrangements in
accordance with the requirements of section 252(d)(2).
``(xiv) Telecommunications services are available for
resale in accordance with the requirements of sections
251(c)(4) and 252(d)(3).
``(d) Administrative Provisions.--
``(1) Application to commission.--On and after the date of
enactment of the Telecommunications Act of 1996, a Bell operating
company or its affiliate may apply to the Commission for
authorization to provide interLATA services originating in any in-
region State. The application shall identify each State for which
the authorization is sought.
``(2) Consultation.--
``(A) Consultation with the attorney general.--The
Commission shall notify the Attorney General promptly of any
application under paragraph (1). Before making any
determination under this subsection, the Commission shall
consult with the Attorney General, and if the Attorney General
submits any comments in writing, such comments shall be
included in the record of the Commission's decision. In
consulting with and submitting comments to the Commission under
this paragraph, the Attorney General shall provide to the
Commission an evaluation of the application using any standard
the Attorney General considers appropriate. The Commission
shall give substantial weight to the Attorney General's
evaluation, but such evaluation shall not have any preclusive
effect on any Commission decision under paragraph (3).
``(B) Consultation with state commissions.--Before making
any determination under this subsection, the Commission shall
consult with the State commission of any State that is the
subject of the application in order to verify the compliance of
the Bell operating company with the requirements of subsection
(c).
``(3) Determination.--Not later than 90 days after receiving an
application under paragraph (1), the Commission shall issue a
written determination approving or denying the authorization
requested in the application for each State. The Commission shall
not approve the authorization requested in an application submitted
under paragraph (1) unless it finds that--
``(A) the petitioning Bell operating company has met the
requirements of subsection (c)(1) and--
``(i) with respect to access and interconnection
provided pursuant to subsection (c)(1)(A), has fully
implemented the competitive checklist in subsection
(c)(2)(B); or
``(ii) with respect to access and interconnection
generally offered pursuant to a statement under subsection
(c)(1)(B), such statement offers all of the items included
in the competitive checklist in subsection (c)(2)(B);
``(B) the requested authorization will be carried out in
accordance with the requirements of section 272; and
``(C) the requested authorization is consistent with the
public interest, convenience, and necessity.
The Commission shall state the basis for its approval or denial of
the application.
``(4) Limitation on commission.--The Commission may not, by
rule or otherwise, limit or extend the terms used in the
competitive checklist set forth in subsection (c)(2)(B).
``(5) Publication.--Not later than 10 days after issuing a
determination under paragraph (3), the Commission shall publish in
the Federal Register a brief description of the determination.
``(6) Enforcement of conditions.--
``(A) Commission authority.--If at any time after the
approval of an application under paragraph (3), the Commission
determines that a Bell operating company has ceased to meet any
of the conditions required for such approval, the Commission
may, after notice and opportunity for a hearing--
``(i) issue an order to such company to correct the
deficiency;
``(ii) impose a penalty on such company pursuant to
title V; or
``(iii) suspend or revoke such approval.
``(B) Receipt and review of complaints.--The Commission
shall establish procedures for the review of complaints
concerning failures by Bell operating companies to meet
conditions required for approval under paragraph (3). Unless
the parties otherwise agree, the Commission shall act on such
complaint within 90 days.
``(e) Limitations.--
``(1) Joint marketing of local and long distance services.--
Until a Bell operating company is authorized pursuant to subsection
(d) to provide interLATA services in an in-region State, or until
36 months have passed since the date of enactment of the
Telecommunications Act of 1996, whichever is earlier, a
telecommunications carrier that serves greater than 5 percent of
the Nation's presubscribed access lines may not jointly market in
such State telephone exchange service obtained from such company
pursuant to section 251(c)(4) with interLATA services offered by
that telecommunications carrier.
``(2) Intralata toll dialing parity.--
``(A) Provision required.--A Bell operating company granted
authority to provide interLATA services under subsection (d)
shall provide intraLATA toll dialing parity throughout that
State coincident with its exercise of that authority.
``(B) Limitation.--Except for single-LATA States and States
that have issued an order by December 19, 1995, requiring a
Bell operating company to implement intraLATA toll dialing
parity, a State may not require a Bell operating company to
implement intraLATA toll dialing parity in that State before a
Bell operating company has been granted authority under this
section to provide interLATA services originating in that State
or before 3 years after the date of enactment of the
Telecommunications Act of 1996, whichever is earlier. Nothing
in this subparagraph precludes a State from issuing an order
requiring intraLATA toll dialing parity in that State prior to
either such date so long as such order does not take effect
until after the earlier of either such dates.
``(f) Exception for Previously Authorized Activities.--Neither
subsection (a) nor section 273 shall prohibit a Bell operating company
or affiliate from engaging, at any time after the date of enactment of
the Telecommunications Act of 1996, in any activity to the extent
authorized by, and subject to the terms and conditions contained in, an
order entered by the United States District Court for the District of
Columbia pursuant to section VII or VIII(C) of the AT&T Consent Decree
if such order was entered on or before such date of enactment, to the
extent such order is not reversed or vacated on appeal. Nothing in this
subsection shall be construed to limit, or to impose terms or
conditions on, an activity in which a Bell operating company is
otherwise authorized to engage under any other provision of this
section.
``(g) Definition of Incidental InterLATA Services.--For purposes of
this section, the term `incidental interLATA services' means the
interLATA provision by a Bell operating company or its affiliate--
``(1)(A) of audio programming, video programming, or other
programming services to subscribers to such services of such
company or affiliate;
``(B) of the capability for interaction by such subscribers to
select or respond to such audio programming, video programming, or
other programming services;
``(C) to distributors of audio programming or video programming
that such company or affiliate owns or controls, or is licensed by
the copyright owner of such programming (or by an assignee of such
owner) to distribute; or
``(D) of alarm monitoring services;
``(2) of two-way interactive video services or Internet
services over dedicated facilities to or for elementary and
secondary schools as defined in section 254(h)(5);
``(3) of commercial mobile services in accordance with section
332(c) of this Act and with the regulations prescribed by the
Commission pursuant to paragraph (8) of such section;
``(4) of a service that permits a customer that is located in
one LATA to retrieve stored information from, or file information
for storage in, information storage facilities of such company that
are located in another LATA;
``(5) of signaling information used in connection with the
provision of telephone exchange services or exchange access by a
local exchange carrier; or
``(6) of network control signaling information to, and receipt
of such signaling information from, common carriers offering
interLATA services at any location within the area in which such
Bell operating company provides telephone exchange services or
exchange access.
``(h) Limitations.--The provisions of subsection (g) are intended
to be narrowly construed. The interLATA services provided under
subparagraph (A), (B), or (C) of subsection (g)(1) are limited to those
interLATA transmissions incidental to the provision by a Bell operating
company or its affiliate of video, audio, and other programming
services that the company or its affiliate is engaged in providing to
the public. The Commission shall ensure that the provision of services
authorized under subsection (g) by a Bell operating company or its
affiliate will not adversely affect telephone exchange service
ratepayers or competition in any telecommunications market.
``(i) Additional Definitions.--As used in this section--
``(1) In-region state.--The term `in-region State' means a
State in which a Bell operating company or any of its affiliates
was authorized to provide wireline telephone exchange service
pursuant to the reorganization plan approved under the AT&T Consent
Decree, as in effect on the day before the date of enactment of the
Telecommunications Act of 1996.
``(2) Audio programming services.--The term `audio programming
services' means programming provided by, or generally considered to
be comparable to programming provided by, a radio broadcast
station.
``(3) Video programming services; other programming services.--
The terms `video programming service' and `other programming
services' have the same meanings as such terms have under section
602 of this Act.
``(j) Certain Service Applications Treated as In-Region Service
Applications.--For purposes of this section, a Bell operating company
application to provide 800 service, private line service, or their
equivalents that--
``(1) terminate in an in-region State of that Bell operating
company, and
``(2) allow the called party to determine the interLATA
carrier,
shall be considered an in-region service subject to the requirements of
subsection (b)(1).
``SEC. 272. SEPARATE AFFILIATE; SAFEGUARDS.
``(a) Separate Affiliate Required for Competitive Activities.--
``(1) In general.--A Bell operating company (including any
affiliate) which is a local exchange carrier that is subject to the
requirements of section 251(c) may not provide any service
described in paragraph (2) unless it provides that service through
one or more affiliates that--
``(A) are separate from any operating company entity that
is subject to the requirements of section 251(c); and
``(B) meet the requirements of subsection (b).
``(2) Services for which a separate affiliate is required.--The
services for which a separate affiliate is required by paragraph
(1) are:
``(A) Manufacturing activities (as defined in section
273(h)).
``(B) Origination of interLATA telecommunications services,
other than--
``(i) incidental interLATA services described in
paragraphs (1), (2), (3), (5), and (6) of section 271(g);
``(ii) out-of-region services described in section
271(b)(2); or
``(iii) previously authorized activities described in
section 271(f).
``(C) InterLATA information services, other than electronic
publishing (as defined in section 274(h)) and alarm monitoring
services (as defined in section 275(e)).
``(b) Structural and Transactional Requirements.--The separate
affiliate required by this section--
``(1) shall operate independently from the Bell operating
company;
``(2) shall maintain books, records, and accounts in the manner
prescribed by the Commission which shall be separate from the
books, records, and accounts maintained by the Bell operating
company of which it is an affiliate;
``(3) shall have separate officers, directors, and employees
from the Bell operating company of which it is an affiliate;
``(4) may not obtain credit under any arrangement that would
permit a creditor, upon default, to have recourse to the assets of
the Bell operating company; and
``(5) shall conduct all transactions with the Bell operating
company of which it is an affiliate on an arm's length basis with
any such transactions reduced to writing and available for public
inspection.
``(c) Nondiscrimination Safeguards.--In its dealings with its
affiliate described in subsection (a), a Bell operating company--
``(1) may not discriminate between that company or affiliate
and any other entity in the provision or procurement of goods,
services, facilities, and information, or in the establishment of
standards; and
``(2) shall account for all transactions with an affiliate
described in subsection (a) in accordance with accounting
principles designated or approved by the Commission.
``(d) Biennial Audit.--
``(1) General requirement.--A company required to operate a
separate affiliate under this section shall obtain and pay for a
joint Federal/State audit every 2 years conducted by an independent
auditor to determine whether such company has complied with this
section and the regulations promulgated under this section, and
particularly whether such company has complied with the separate
accounting requirements under subsection (b).
``(2) Results submitted to commission; state commissions.--The
auditor described in paragraph (1) shall submit the results of the
audit to the Commission and to the State commission of each State
in which the company audited provides service, which shall make
such results available for public inspection. Any party may submit
comments on the final audit report.
``(3) Access to documents.--For purposes of conducting audits
and reviews under this subsection--
``(A) the independent auditor, the Commission, and the
State commission shall have access to the financial accounts
and records of each company and of its affiliates necessary to
verify transactions conducted with that company that are
relevant to the specific activities permitted under this
section and that are necessary for the regulation of rates;
``(B) the Commission and the State commission shall have
access to the working papers and supporting materials of any
auditor who performs an audit under this section; and
``(C) the State commission shall implement appropriate
procedures to ensure the protection of any proprietary
information submitted to it under this section.
``(e) Fulfillment of Certain Requests.--A Bell operating company
and an affiliate that is subject to the requirements of section
251(c)--
``(1) shall fulfill any requests from an unaffiliated entity
for telephone exchange service and exchange access within a period
no longer than the period in which it provides such telephone
exchange service and exchange access to itself or to its
affiliates;
``(2) shall not provide any facilities, services, or
information concerning its provision of exchange access to the
affiliate described in subsection (a) unless such facilities,
services, or information are made available to other providers of
interLATA services in that market on the same terms and conditions;
``(3) shall charge the affiliate described in subsection (a),
or impute to itself (if using the access for its provision of its
own services), an amount for access to its telephone exchange
service and exchange access that is no less than the amount charged
to any unaffiliated interexchange carriers for such service; and
``(4) may provide any interLATA or intraLATA facilities or
services to its interLATA affiliate if such services or facilities
are made available to all carriers at the same rates and on the
same terms and conditions, and so long as the costs are
appropriately allocated.
``(f) Sunset.--
``(1) Manufacturing and long distance.--The provisions of this
section (other than subsection (e)) shall cease to apply with
respect to the manufacturing activities or the interLATA
telecommunications services of a Bell operating company 3 years
after the date such Bell operating company or any Bell operating
company affiliate is authorized to provide interLATA
telecommunications services under section 271(d), unless the
Commission extends such 3-year period by rule or order.
``(2) InterLATA information services.--The provisions of this
section (other than subsection (e)) shall cease to apply with
respect to the interLATA information services of a Bell operating
company 4 years after the date of enactment of the
Telecommunications Act of 1996, unless the Commission extends such
4-year period by rule or order.
``(3) Preservation of existing authority.--Nothing in this
subsection shall be construed to limit the authority of the
Commission under any other section of this Act to prescribe
safeguards consistent with the public interest, convenience, and
necessity.
``(g) Joint Marketing.--
``(1) Affiliate sales of telephone exchange services.--A Bell
operating company affiliate required by this section may not market
or sell telephone exchange services provided by the Bell operating
company unless that company permits other entities offering the
same or similar service to market and sell its telephone exchange
services.
``(2) Bell operating company sales of affiliate services.--A
Bell operating company may not market or sell interLATA service
provided by an affiliate required by this section within any of its
in-region States until such company is authorized to provide
interLATA services in such State under section 271(d).
``(3) Rule of construction.--The joint marketing and sale of
services permitted under this subsection shall not be considered to
violate the nondiscrimination provisions of subsection (c).
``(h) Transition.--With respect to any activity in which a Bell
operating company is engaged on the date of enactment of the
Telecommunications Act of 1996, such company shall have one year from
such date of enactment to comply with the requirements of this section.
``SEC. 273. MANUFACTURING BY BELL OPERATING COMPANIES.
``(a) Authorization.--A Bell operating company may manufacture and
provide telecommunications equipment, and manufacture customer premises
equipment, if the Commission authorizes that Bell operating company or
any Bell operating company affiliate to provide interLATA services
under section 271(d), subject to the requirements of this section and
the regulations prescribed thereunder, except that neither a Bell
operating company nor any of its affiliates may engage in such
manufacturing in conjunction with a Bell operating company not so
affiliated or any of its affiliates.
``(b) Collaboration; Research and Royalty Agreements.--
``(1) Collaboration.--Subsection (a) shall not prohibit a Bell
operating company from engaging in close collaboration with any
manufacturer of customer premises equipment or telecommunications
equipment during the design and development of hardware, software,
or combinations thereof related to such equipment.
``(2) Certain research arrangements; royalty agreements.--
Subsection (a) shall not prohibit a Bell operating company from--
``(A) engaging in research activities related to
manufacturing, and
``(B) entering into royalty agreements with manufacturers
of telecommunications equipment.
``(c) Information Requirements.--
``(1) Information on protocols and technical requirements.--
Each Bell operating company shall, in accordance with regulations
prescribed by the Commission, maintain and file with the Commission
full and complete information with respect to the protocols and
technical requirements for connection with and use of its telephone
exchange service facilities. Each such company shall report
promptly to the Commission any material changes or planned changes
to such protocols and requirements, and the schedule for
implementation of such changes or planned changes.
``(2) Disclosure of information.--A Bell operating company
shall not disclose any information required to be filed under
paragraph (1) unless that information has been filed promptly, as
required by regulation by the Commission.
``(3) Access by competitors to information.--The Commission may
prescribe such additional regulations under this subsection as may
be necessary to ensure that manufacturers have access to the
information with respect to the protocols and technical
requirements for connection with and use of telephone exchange
service facilities that a Bell operating company makes available to
any manufacturing affiliate or any unaffiliated manufacturer.
``(4) Planning information.--Each Bell operating company shall
provide, to interconnecting carriers providing telephone exchange
service, timely information on the planned deployment of
telecommunications equipment.
``(d) Manufacturing Limitations for Standard-Setting
Organizations.--
``(1) Application to bell communications research or
manufacturers.--Bell Communications Research, Inc., or any
successor entity or affiliate--
``(A) shall not be considered a Bell operating company or a
successor or assign of a Bell operating company at such time as
it is no longer an affiliate of any Bell operating company; and
``(B) notwithstanding paragraph (3), shall not engage in
manufacturing telecommunications equipment or customer premises
equipment as long as it is an affiliate of more than 1
otherwise unaffiliated Bell operating company or successor or
assign of any such company.
Nothing in this subsection prohibits Bell Communications Research,
Inc., or any successor entity, from engaging in any activity in
which it is lawfully engaged on the date of enactment of the
Telecommunications Act of 1996. Nothing provided in this subsection
shall render Bell Communications Research, Inc., or any successor
entity, a common carrier under title II of this Act. Nothing in
this subsection restricts any manufacturer from engaging in any
activity in which it is lawfully engaged on the date of enactment
of the Telecommunications Act of 1996.
``(2) Proprietary information.--Any entity which establishes
standards for telecommunications equipment or customer premises
equipment, or generic network requirements for such equipment, or
certifies telecommunications equipment or customer premises
equipment, shall be prohibited from releasing or otherwise using
any proprietary information, designated as such by its owner, in
its possession as a result of such activity, for any purpose other
than purposes authorized in writing by the owner of such
information, even after such entity ceases to be so engaged.
``(3) Manufacturing safeguards.--(A) Except as prohibited in
paragraph (1), and subject to paragraph (6), any entity which
certifies telecommunications equipment or customer premises
equipment manufactured by an unaffiliated entity shall only
manufacture a particular class of telecommunications equipment or
customer premises equipment for which it is undertaking or has
undertaken, during the previous 18 months, certification activity
for such class of equipment through a separate affiliate.
``(B) Such separate affiliate shall--
``(i) maintain books, records, and accounts separate from
those of the entity that certifies such equipment, consistent
with generally acceptable accounting principles;
``(ii) not engage in any joint manufacturing activities
with such entity; and
``(iii) have segregated facilities and separate employees
with such entity.
``(C) Such entity that certifies such equipment shall--
``(i) not discriminate in favor of its manufacturing
affiliate in the establishment of standards, generic
requirements, or product certification;
``(ii) not disclose to the manufacturing affiliate any
proprietary information that has been received at any time from
an unaffiliated manufacturer, unless authorized in writing by
the owner of the information; and
``(iii) not permit any employee engaged in product
certification for telecommunications equipment or customer
premises equipment to engage jointly in sales or marketing of
any such equipment with the affiliated manufacturer.
``(4) Standard-setting entities.--Any entity that is not an
accredited standards development organization and that establishes
industry-wide standards for telecommunications equipment or
customer premises equipment, or industry-wide generic network
requirements for such equipment, or that certifies
telecommunications equipment or customer premises equipment
manufactured by an unaffiliated entity, shall--
``(A) establish and publish any industry-wide standard for,
industry-wide generic requirement for, or any substantial
modification of an existing industry-wide standard or industry-
wide generic requirement for, telecommunications equipment or
customer premises equipment only in compliance with the
following procedure--
``(i) such entity shall issue a public notice of its
consideration of a proposed industry-wide standard or
industry-wide generic requirement;
``(ii) such entity shall issue a public invitation to
interested industry parties to fund and participate in such
efforts on a reasonable and nondiscriminatory basis,
administered in such a manner as not to unreasonably
exclude any interested industry party;
``(iii) such entity shall publish a text for comment by
such parties as have agreed to participate in the process
pursuant to clause (ii), provide such parties a full
opportunity to submit comments, and respond to comments
from such parties;
``(iv) such entity shall publish a final text of the
industry-wide standard or industry-wide generic
requirement, including the comments in their entirety, of
any funding party which requests to have its comments so
published; and
``(v) such entity shall attempt, prior to publishing a
text for comment, to agree with the funding parties as a
group on a mutually satisfactory dispute resolution process
which such parties shall utilize as their sole recourse in
the event of a dispute on technical issues as to which
there is disagreement between any funding party and the
entity conducting such activities, except that if no
dispute resolution process is agreed to by all the parties,
a funding party may utilize the dispute resolution
procedures established pursuant to paragraph (5) of this
subsection;
``(B) engage in product certification for
telecommunications equipment or customer premises equipment
manufactured by unaffiliated entities only if--
``(i) such activity is performed pursuant to published
criteria;
``(ii) such activity is performed pursuant to auditable
criteria; and
``(iii) such activity is performed pursuant to
available industry-accepted testing methods and standards,
where applicable, unless otherwise agreed upon by the
parties funding and performing such activity;
``(C) not undertake any actions to monopolize or attempt to
monopolize the market for such services; and
``(D) not preferentially treat its own telecommunications
equipment or customer premises equipment, or that of its
affiliate, over that of any other entity in establishing and
publishing industry-wide standards or industry-wide generic
requirements for, and in certification of, telecommunications
equipment and customer premises equipment.
``(5) Alternate dispute resolution.--Within 90 days after the
date of enactment of the Telecommunications Act of 1996, the
Commission shall prescribe a dispute resolution process to be
utilized in the event that a dispute resolution process is not
agreed upon by all the parties when establishing and publishing any
industry-wide standard or industry-wide generic requirement for
telecommunications equipment or customer premises equipment,
pursuant to paragraph (4)(A)(v). The Commission shall not establish
itself as a party to the dispute resolution process. Such dispute
resolution process shall permit any funding party to resolve a
dispute with the entity conducting the activity that significantly
affects such funding party's interests, in an open,
nondiscriminatory, and unbiased fashion, within 30 days after the
filing of such dispute. Such disputes may be filed within 15 days
after the date the funding party receives a response to its
comments from the entity conducting the activity. The Commission
shall establish penalties to be assessed for delays caused by
referral of frivolous disputes to the dispute resolution process.
``(6) Sunset.--The requirements of paragraphs (3) and (4) shall
terminate for the particular relevant activity when the Commission
determines that there are alternative sources of industry-wide
standards, industry-wide generic requirements, or product
certification for a particular class of telecommunications
equipment or customer premises equipment available in the United
States. Alternative sources shall be deemed to exist when such
sources provide commercially viable alternatives that are providing
such services to customers. The Commission shall act on any
application for such a determination within 90 days after receipt
of such application, and shall receive public comment on such
application.
``(7) Administration and enforcement authority.--For the
purposes of administering this subsection and the regulations
prescribed thereunder, the Commission shall have the same remedial
authority as the Commission has in administering and enforcing the
provisions of this title with respect to any common carrier subject
to this Act.
``(8) Definitions.--For purposes of this subsection:
``(A) The term `affiliate' shall have the same meaning as
in section 3 of this Act, except that, for purposes of
paragraph (1)(B)--
``(i) an aggregate voting equity interest in Bell
Communications Research, Inc., of at least 5 percent of its
total voting equity, owned directly or indirectly by more
than 1 otherwise unaffiliated Bell operating company, shall
constitute an affiliate relationship; and
``(ii) a voting equity interest in Bell Communications
Research, Inc., by any otherwise unaffiliated Bell
operating company of less than 1 percent of Bell
Communications Research's total voting equity shall not be
considered to be an equity interest under this paragraph.
``(B) The term `generic requirement' means a description of
acceptable product attributes for use by local exchange
carriers in establishing product specifications for the
purchase of telecommunications equipment, customer premises
equipment, and software integral thereto.
``(C) The term `industry-wide' means activities funded by
or performed on behalf of local exchange carriers for use in
providing wireline telephone exchange service whose combined
total of deployed access lines in the United States constitutes
at least 30 percent of all access lines deployed by
telecommunications carriers in the United States as of the date
of enactment of the Telecommunications Act of 1996.
``(D) The term `certification' means any technical process
whereby a party determines whether a product, for use by more
than one local exchange carrier, conforms with the specified
requirements pertaining to such product.
``(E) The term `accredited standards development
organization' means an entity composed of industry members
which has been accredited by an institution vested with the
responsibility for standards accreditation by the industry.
``(e) Bell Operating Company Equipment Procurement and Sales.--
``(1) Nondiscrimination standards for manufacturing.--In the
procurement or awarding of supply contracts for telecommunications
equipment, a Bell operating company, or any entity acting on its
behalf, for the duration of the requirement for a separate
subsidiary including manufacturing under this Act--
``(A) shall consider such equipment, produced or supplied
by unrelated persons; and
``(B) may not discriminate in favor of equipment produced
or supplied by an affiliate or related person.
``(2) Procurement standards.--Each Bell operating company or
any entity acting on its behalf shall make procurement decisions
and award all supply contracts for equipment, services, and
software on the basis of an objective assessment of price, quality,
delivery, and other commercial factors.
``(3) Network planning and design.--A Bell operating company
shall, to the extent consistent with the antitrust laws, engage in
joint network planning and design with local exchange carriers
operating in the same area of interest. No participant in such
planning shall be allowed to delay the introduction of new
technology or the deployment of facilities to provide
telecommunications services, and agreement with such other carriers
shall not be required as a prerequisite for such introduction or
deployment.
``(4) Sales restrictions.--Neither a Bell operating company
engaged in manufacturing nor a manufacturing affiliate of such a
company shall restrict sales to any local exchange carrier of
telecommunications equipment, including software integral to the
operation of such equipment and related upgrades.
``(5) Protection of proprietary information.--A Bell operating
company and any entity it owns or otherwise controls shall protect
the proprietary information submitted for procurement decisions
from release not specifically authorized by the owner of such
information.
``(f) Administration and Enforcement Authority.--For the purposes
of administering and enforcing the provisions of this section and the
regulations prescribed thereunder, the Commission shall have the same
authority, power, and functions with respect to any Bell operating
company or any affiliate thereof as the Commission has in administering
and enforcing the provisions of this title with respect to any common
carrier subject to this Act.
``(g) Additional Rules and Regulations.--The Commission may
prescribe such additional rules and regulations as the Commission
determines are necessary to carry out the provisions of this section,
and otherwise to prevent discrimination and cross-subsidization in a
Bell operating company's dealings with its affiliate and with third
parties.
``(h) Definition.--As used in this section, the term
`manufacturing' has the same meaning as such term has under the AT&T
Consent Decree.
``SEC. 274. ELECTRONIC PUBLISHING BY BELL OPERATING COMPANIES.
``(a) Limitations.--No Bell operating company or any affiliate may
engage in the provision of electronic publishing that is disseminated
by means of such Bell operating company's or any of its affiliates'
basic telephone service, except that nothing in this section shall
prohibit a separated affiliate or electronic publishing joint venture
operated in accordance with this section from engaging in the provision
of electronic publishing.
``(b) Separated Affiliate or Electronic Publishing Joint Venture
Requirements.--A separated affiliate or electronic publishing joint
venture shall be operated independently from the Bell operating
company. Such separated affiliate or joint venture and the Bell
operating company with which it is affiliated shall--
``(1) maintain separate books, records, and accounts and
prepare separate financial statements;
``(2) not incur debt in a manner that would permit a creditor
of the separated affiliate or joint venture upon default to have
recourse to the assets of the Bell operating company;
``(3) carry out transactions (A) in a manner consistent with
such independence, (B) pursuant to written contracts or tariffs
that are filed with the Commission and made publicly available, and
(C) in a manner that is auditable in accordance with generally
accepted auditing standards;
``(4) value any assets that are transferred directly or
indirectly from the Bell operating company to a separated affiliate
or joint venture, and record any transactions by which such assets
are transferred, in accordance with such regulations as may be
prescribed by the Commission or a State commission to prevent
improper cross subsidies;
``(5) between a separated affiliate and a Bell operating
company--
``(A) have no officers, directors, and employees in common
after the effective date of this section; and
``(B) own no property in common;
``(6) not use for the marketing of any product or service of
the separated affiliate or joint venture, the name, trademarks, or
service marks of an existing Bell operating company except for
names, trademarks, or service marks that are owned by the entity
that owns or controls the Bell operating company;
``(7) not permit the Bell operating company--
``(A) to perform hiring or training of personnel on behalf
of a separated affiliate;
``(B) to perform the purchasing, installation, or
maintenance of equipment on behalf of a separated affiliate,
except for telephone service that it provides under tariff or
contract subject to the provisions of this section; or
``(C) to perform research and development on behalf of a
separated affiliate;
``(8) each have performed annually a compliance review--
``(A) that is conducted by an independent entity for the
purpose of determining compliance during the preceding calendar
year with any provision of this section; and
``(B) the results of which are maintained by the separated
affiliate or joint venture and the Bell operating company for a
period of 5 years subject to review by any lawful authority;
and
``(9) within 90 days of receiving a review described in
paragraph (8), file a report of any exceptions and corrective
action with the Commission and allow any person to inspect and copy
such report subject to reasonable safeguards to protect any
proprietary information contained in such report from being used
for purposes other than to enforce or pursue remedies under this
section.
``(c) Joint Marketing.--
``(1) In general.--Except as provided in paragraph (2)--
``(A) a Bell operating company shall not carry out any
promotion, marketing, sales, or advertising for or in
conjunction with a separated affiliate; and
``(B) a Bell operating company shall not carry out any
promotion, marketing, sales, or advertising for or in
conjunction with an affiliate that is related to the provision
of electronic publishing.
``(2) Permissible joint activities.--
``(A) Joint telemarketing.--A Bell operating company may
provide inbound telemarketing or referral services related to
the provision of electronic publishing for a separated
affiliate, electronic publishing joint venture, affiliate, or
unaffiliated electronic publisher: Provided, That if such
services are provided to a separated affiliate, electronic
publishing joint venture, or affiliate, such services shall be
made available to all electronic publishers on request, on
nondiscriminatory terms.
``(B) Teaming arrangements.--A Bell operating company may
engage in nondiscriminatory teaming or business arrangements to
engage in electronic publishing with any separated affiliate or
with any other electronic publisher if (i) the Bell operating
company only provides facilities, services, and basic telephone
service information as authorized by this section, and (ii) the
Bell operating company does not own such teaming or business
arrangement.
``(C) Electronic publishing joint ventures.--A Bell
operating company or affiliate may participate on a
nonexclusive basis in electronic publishing joint ventures with
entities that are not a Bell operating company, affiliate, or
separated affiliate to provide electronic publishing services,
if the Bell operating company or affiliate has not more than a
50 percent direct or indirect equity interest (or the
equivalent thereof) or the right to more than 50 percent of the
gross revenues under a revenue sharing or royalty agreement in
any electronic publishing joint venture. Officers and employees
of a Bell operating company or affiliate participating in an
electronic publishing joint venture may not have more than 50
percent of the voting control over the electronic publishing
joint venture. In the case of joint ventures with small, local
electronic publishers, the Commission for good cause shown may
authorize the Bell operating company or affiliate to have a
larger equity interest, revenue share, or voting control but
not to exceed 80 percent. A Bell operating company
participating in an electronic publishing joint venture may
provide promotion, marketing, sales, or advertising personnel
and services to such joint venture.
``(d) Bell Operating Company Requirement.--A Bell operating company
under common ownership or control with a separated affiliate or
electronic publishing joint venture shall provide network access and
interconnections for basic telephone service to electronic publishers
at just and reasonable rates that are tariffed (so long as rates for
such services are subject to regulation) and that are not higher on a
per-unit basis than those charged for such services to any other
electronic publisher or any separated affiliate engaged in electronic
publishing.
``(e) Private Right of Action.--
``(1) Damages.--Any person claiming that any act or practice of
any Bell operating company, affiliate, or separated affiliate
constitutes a violation of this section may file a complaint with
the Commission or bring suit as provided in section 207 of this
Act, and such Bell operating company, affiliate, or separated
affiliate shall be liable as provided in section 206 of this Act;
except that damages may not be awarded for a violation that is
discovered by a compliance review as required by subsection (b)(7)
of this section and corrected within 90 days.
``(2) Cease and desist orders.--In addition to the provisions
of paragraph (1), any person claiming that any act or practice of
any Bell operating company, affiliate, or separated affiliate
constitutes a violation of this section may make application to the
Commission for an order to cease and desist such violation or may
make application in any district court of the United States of
competent jurisdiction for an order enjoining such acts or
practices or for an order compelling compliance with such
requirement.
``(f) Separated Affiliate Reporting Requirement.--Any separated
affiliate under this section shall file with the Commission annual
reports in a form substantially equivalent to the Form 10-K required by
regulations of the Securities and Exchange Commission.
``(g) Effective Dates.--
``(1) Transition.--Any electronic publishing service being
offered to the public by a Bell operating company or affiliate on
the date of enactment of the Telecommunications Act of 1996 shall
have one year from such date of enactment to comply with the
requirements of this section.
``(2) Sunset.--The provisions of this section shall not apply
to conduct occurring after 4 years after the date of enactment of
the Telecommunications Act of 1996.
``(h) Definition of Electronic Publishing.--
``(1) In general.--The term `electronic publishing' means the
dissemination, provision, publication, or sale to an unaffiliated
entity or person, of any one or more of the following: news
(including sports); entertainment (other than interactive games);
business, financial, legal, consumer, or credit materials;
editorials, columns, or features; advertising; photos or images;
archival or research material; legal notices or public records;
scientific, educational, instructional, technical, professional,
trade, or other literary materials; or other like or similar
information.
``(2) Exceptions.--The term `electronic publishing' shall not
include the following services:
``(A) Information access, as that term is defined by the
AT&T Consent Decree.
``(B) The transmission of information as a common carrier.
``(C) The transmission of information as part of a gateway
to an information service that does not involve the generation
or alteration of the content of information, including data
transmission, address translation, protocol conversion, billing
management, introductory information content, and navigational
systems that enable users to access electronic publishing
services, which do not affect the presentation of such
electronic publishing services to users.
``(D) Voice storage and retrieval services, including voice
messaging and electronic mail services.
``(E) Data processing or transaction processing services
that do not involve the generation or alteration of the content
of information.
``(F) Electronic billing or advertising of a Bell operating
company's regulated telecommunications services.
``(G) Language translation or data format conversion.
``(H) The provision of information necessary for the
management, control, or operation of a telephone company
telecommunications system.
``(I) The provision of directory assistance that provides
names, addresses, and telephone numbers and does not include
advertising.
``(J) Caller identification services.
``(K) Repair and provisioning databases and credit card and
billing validation for telephone company operations.
``(L) 911-E and other emergency assistance databases.
``(M) Any other network service of a type that is like or
similar to these network services and that does not involve the
generation or alteration of the content of information.
``(N) Any upgrades to these network services that do not
involve the generation or alteration of the content of
information.
``(O) Video programming or full motion video entertainment
on demand.
``(i) Additional Definitions.--As used in this section--
``(1) The term `affiliate' means any entity that, directly or
indirectly, owns or controls, is owned or controlled by, or is
under common ownership or control with, a Bell operating company.
Such term shall not include a separated affiliate.
``(2) The term `basic telephone service' means any wireline
telephone exchange service, or wireline telephone exchange service
facility, provided by a Bell operating company in a telephone
exchange area, except that such term does not include--
``(A) a competitive wireline telephone exchange service
provided in a telephone exchange area where another entity
provides a wireline telephone exchange service that was
provided on January 1, 1984, or
``(B) a commercial mobile service.
``(3) The term `basic telephone service information' means
network and customer information of a Bell operating company and
other information acquired by a Bell operating company as a result
of its engaging in the provision of basic telephone service.
``(4) The term `control' has the meaning that it has in 17
C.F.R. 240.12b-2, the regulations promulgated by the Securities and
Exchange Commission pursuant to the Securities Exchange Act of 1934
(15 U.S.C. 78a et seq.) or any successor provision to such section.
``(5) The term `electronic publishing joint venture' means a
joint venture owned by a Bell operating company or affiliate that
engages in the provision of electronic publishing which is
disseminated by means of such Bell operating company's or any of
its affiliates' basic telephone service.
``(6) The term `entity' means any organization, and includes
corporations, partnerships, sole proprietorships, associations, and
joint ventures.
``(7) The term `inbound telemarketing' means the marketing of
property, goods, or services by telephone to a customer or
potential customer who initiated the call.
``(8) The term `own' with respect to an entity means to have a
direct or indirect equity interest (or the equivalent thereof) of
more than 10 percent of an entity, or the right to more than 10
percent of the gross revenues of an entity under a revenue sharing
or royalty agreement.
``(9) The term `separated affiliate' means a corporation under
common ownership or control with a Bell operating company that does
not own or control a Bell operating company and is not owned or
controlled by a Bell operating company and that engages in the
provision of electronic publishing which is disseminated by means
of such Bell operating company's or any of its affiliates' basic
telephone service.
``(10) The term `Bell operating company' has the meaning
provided in section 3, except that such term includes any entity or
corporation that is owned or controlled by such a company (as so
defined) but does not include an electronic publishing joint
venture owned by such an entity or corporation.
``SEC. 275. ALARM MONITORING SERVICES.
``(a) Delayed Entry Into Alarm Monitoring.--
``(1) Prohibition.--No Bell operating company or affiliate
thereof shall engage in the provision of alarm monitoring services
before the date which is 5 years after the date of enactment of the
Telecommunications Act of 1996.
``(2) Existing activities.--Paragraph (1) does not prohibit or
limit the provision, directly or through an affiliate, of alarm
monitoring services by a Bell operating company that was engaged in
providing alarm monitoring services as of November 30, 1995,
directly or through an affiliate. Such Bell operating company or
affiliate may not acquire any equity interest in, or obtain
financial control of, any unaffiliated alarm monitoring service
entity after November 30, 1995, and until 5 years after the date of
enactment of the Telecommunications Act of 1996, except that this
sentence shall not prohibit an exchange of customers for the
customers of an unaffiliated alarm monitoring service entity.
``(b) Nondiscrimination.--An incumbent local exchange carrier (as
defined in section 251(h)) engaged in the provision of alarm monitoring
services shall--
``(1) provide nonaffiliated entities, upon reasonable request,
with the network services it provides to its own alarm monitoring
operations, on nondiscriminatory terms and conditions; and
``(2) not subsidize its alarm monitoring services either
directly or indirectly from telephone exchange service operations.
``(c) Expedited Consideration of Complaints.--The Commission shall
establish procedures for the receipt and review of complaints
concerning violations of subsection (b) or the regulations thereunder
that result in material financial harm to a provider of alarm
monitoring service. Such procedures shall ensure that the Commission
will make a final determination with respect to any such complaint
within 120 days after receipt of the complaint. If the complaint
contains an appropriate showing that the alleged violation occurred, as
determined by the Commission in accordance with such regulations, the
Commission shall, within 60 days after receipt of the complaint, order
the incumbent local exchange carrier (as defined in section 251(h)) and
its affiliates to cease engaging in such violation pending such final
determination.
``(d) Use of Data.--A local exchange carrier may not record or use
in any fashion the occurrence or contents of calls received by
providers of alarm monitoring services for the purposes of marketing
such services on behalf of such local exchange carrier, or any other
entity. Any regulations necessary to enforce this subsection shall be
issued initially within 6 months after the date of enactment of the
Telecommunications Act of 1996.
``(e) Definition of Alarm Monitoring Service.--The term `alarm
monitoring service' means a service that uses a device located at a
residence, place of business, or other fixed premises--
``(1) to receive signals from other devices located at or about
such premises regarding a possible threat at such premises to life,
safety, or property, from burglary, fire, vandalism, bodily injury,
or other emergency, and
``(2) to transmit a signal regarding such threat by means of
transmission facilities of a local exchange carrier or one of its
affiliates to a remote monitoring center to alert a person at such
center of the need to inform the customer or another person or
police, fire, rescue, security, or public safety personnel of such
threat,
but does not include a service that uses a medical monitoring device
attached to an individual for the automatic surveillance of an ongoing
medical condition.
``SEC. 276. PROVISION OF PAYPHONE SERVICE.
``(a) Nondiscrimination Safeguards.--After the effective date of
the rules prescribed pursuant to subsection (b), any Bell operating
company that provides payphone service--
``(1) shall not subsidize its payphone service directly or
indirectly from its telephone exchange service operations or its
exchange access operations; and
``(2) shall not prefer or discriminate in favor of its payphone
service.
``(b) Regulations.--
``(1) Contents of regulations.--In order to promote competition
among payphone service providers and promote the widespread
deployment of payphone services to the benefit of the general
public, within 9 months after the date of enactment of the
Telecommunications Act of 1996, the Commission shall take all
actions necessary (including any reconsideration) to prescribe
regulations that--
``(A) establish a per call compensation plan to ensure that
all payphone service providers are fairly compensated for each
and every completed intrastate and interstate call using their
payphone, except that emergency calls and telecommunications
relay service calls for hearing disabled individuals shall not
be subject to such compensation;
``(B) discontinue the intrastate and interstate carrier
access charge payphone service elements and payments in effect
on such date of enactment, and all intrastate and interstate
payphone subsidies from basic exchange and exchange access
revenues, in favor of a compensation plan as specified in
subparagraph (A);
``(C) prescribe a set of nonstructural safeguards for Bell
operating company payphone service to implement the provisions
of paragraphs (1) and (2) of subsection (a), which safeguards
shall, at a minimum, include the nonstructural safeguards equal
to those adopted in the Computer Inquiry-III (CC Docket No. 90-
623) proceeding;
``(D) provide for Bell operating company payphone service
providers to have the same right that independent payphone
providers have to negotiate with the location provider on the
location provider's selecting and contracting with, and,
subject to the terms of any agreement with the location
provider, to select and contract with, the carriers that carry
interLATA calls from their payphones, unless the Commission
determines in the rulemaking pursuant to this section that it
is not in the public interest; and
``(E) provide for all payphone service providers to have
the right to negotiate with the location provider on the
location provider's selecting and contracting with, and,
subject to the terms of any agreement with the location
provider, to select and contract with, the carriers that carry
intraLATA calls from their payphones.
``(2) Public interest telephones.--In the rulemaking conducted
pursuant to paragraph (1), the Commission shall determine whether
public interest payphones, which are provided in the interest of
public health, safety, and welfare, in locations where there would
otherwise not be a payphone, should be maintained, and if so,
ensure that such public interest payphones are supported fairly and
equitably.
``(3) Existing contracts.--Nothing in this section shall affect
any existing contracts between location providers and payphone
service providers or interLATA or intraLATA carriers that are in
force and effect as of the date of enactment of the
Telecommunications Act of 1996.
``(c) State Preemption.--To the extent that any State requirements
are inconsistent with the Commission's regulations, the Commission's
regulations on such matters shall preempt such State requirements.
``(d) Definition.--As used in this section, the term `payphone
service' means the provision of public or semi-public pay telephones,
the provision of inmate telephone service in correctional institutions,
and any ancillary services.''.
(b) Review of Entry Decisions.--Section 402(b) (47 U.S.C. 402(b))
is amended--
(1) in paragraph (6), by striking ``(3), and (4)'' and
inserting ``(3), (4), and (9)''; and
(2) by adding at the end the following new paragraph:
``(9) By any applicant for authority to provide interLATA services
under section 271 of this Act whose application is denied by the
Commission.''.
TITLE II--BROADCAST SERVICES
SEC. 201. BROADCAST SPECTRUM FLEXIBILITY.
Title III is amended by inserting after section 335 (47 U.S.C. 335)
the following new section:
``SEC. 336. BROADCAST SPECTRUM FLEXIBILITY.
``(a) Commission Action.--If the Commission determines to issue
additional licenses for advanced television services, the Commission--
``(1) should limit the initial eligibility for such licenses to
persons that, as of the date of such issuance, are licensed to
operate a television broadcast station or hold a permit to
construct such a station (or both); and
``(2) shall adopt regulations that allow the holders of such
licenses to offer such ancillary or supplementary services on
designated frequencies as may be consistent with the public
interest, convenience, and necessity.
``(b) Contents of Regulations.--In prescribing the regulations
required by subsection (a), the Commission shall--
``(1) only permit such licensee or permittee to offer ancillary
or supplementary services if the use of a designated frequency for
such services is consistent with the technology or method
designated by the Commission for the provision of advanced
television services;
``(2) limit the broadcasting of ancillary or supplementary
services on designated frequencies so as to avoid derogation of any
advanced television services, including high definition television
broadcasts, that the Commission may require using such frequencies;
``(3) apply to any other ancillary or supplementary service
such of the Commission's regulations as are applicable to the
offering of analogous services by any other person, except that no
ancillary or supplementary service shall have any rights to
carriage under section 614 or 615 or be deemed a multichannel video
programming distributor for purposes of section 628;
``(4) adopt such technical and other requirements as may be
necessary or appropriate to assure the quality of the signal used
to provide advanced television services, and may adopt regulations
that stipulate the minimum number of hours per day that such signal
must be transmitted; and
``(5) prescribe such other regulations as may be necessary for
the protection of the public interest, convenience, and necessity.
``(c) Recovery of License.--If the Commission grants a license for
advanced television services to a person that, as of the date of such
issuance, is licensed to operate a television broadcast station or
holds a permit to construct such a station (or both), the Commission
shall, as a condition of such license, require that either the
additional license or the original license held by the licensee be
surrendered to the Commission for reallocation or reassignment (or
both) pursuant to Commission regulation.
``(d) Public Interest Requirement.--Nothing in this section shall
be construed as relieving a television broadcasting station from its
obligation to serve the public interest, convenience, and necessity. In
the Commission's review of any application for renewal of a broadcast
license for a television station that provides ancillary or
supplementary services, the television licensee shall establish that
all of its program services on the existing or advanced television
spectrum are in the public interest. Any violation of the Commission
rules applicable to ancillary or supplementary services shall reflect
upon the licensee's qualifications for renewal of its license.
``(e) Fees.--
``(1) Services to which fees apply.--If the regulations
prescribed pursuant to subsection (a) permit a licensee to offer
ancillary or supplementary services on a designated frequency--
``(A) for which the payment of a subscription fee is
required in order to receive such services, or
``(B) for which the licensee directly or indirectly
receives compensation from a third party in return for
transmitting material furnished by such third party (other than
commercial advertisements used to support broadcasting for
which a subscription fee is not required),
the Commission shall establish a program to assess and collect from
the licensee for such designated frequency an annual fee or other
schedule or method of payment that promotes the objectives
described in subparagraphs (A) and (B) of paragraph (2).
``(2) Collection of fees.--The program required by paragraph
(1) shall--
``(A) be designed (i) to recover for the public a portion
of the value of the public spectrum resource made available for
such commercial use, and (ii) to avoid unjust enrichment
through the method employed to permit such uses of that
resource;
``(B) recover for the public an amount that, to the extent
feasible, equals but does not exceed (over the term of the
license) the amount that would have been recovered had such
services been licensed pursuant to the provisions of section
309(j) of this Act and the Commission's regulations thereunder;
and
``(C) be adjusted by the Commission from time to time in
order to continue to comply with the requirements of this
paragraph.
``(3) Treatment of revenues.--
``(A) General rule.--Except as provided in subparagraph
(B), all proceeds obtained pursuant to the regulations required
by this subsection shall be deposited in the Treasury in
accordance with chapter 33 of title 31, United States Code.
``(B) Retention of revenues.--Notwithstanding subparagraph
(A), the salaries and expenses account of the Commission shall
retain as an offsetting collection such sums as may be
necessary from such proceeds for the costs of developing and
implementing the program required by this section and
regulating and supervising advanced television services. Such
offsetting collections shall be available for obligation
subject to the terms and conditions of the receiving
appropriations account, and shall be deposited in such accounts
on a quarterly basis.
``(4) Report.--Within 5 years after the date of enactment of
the Telecommunications Act of 1996, the Commission shall report to
the Congress on the implementation of the program required by this
subsection, and shall annually thereafter advise the Congress on
the amounts collected pursuant to such program.
``(f) Evaluation.--Within 10 years after the date the Commission
first issues additional licenses for advanced television services, the
Commission shall conduct an evaluation of the advanced television
services program. Such evaluation shall include--
``(1) an assessment of the willingness of consumers to purchase
the television receivers necessary to receive broadcasts of
advanced television services;
``(2) an assessment of alternative uses, including public
safety use, of the frequencies used for such broadcasts; and
``(3) the extent to which the Commission has been or will be
able to reduce the amount of spectrum assigned to licensees.
``(g) Definitions.--As used in this section:
``(1) Advanced television services.--The term `advanced
television services' means television services provided using
digital or other advanced technology as further defined in the
opinion, report, and order of the Commission entitled `Advanced
Television Systems and Their Impact Upon the Existing Television
Broadcast Service', MM Docket 87-268, adopted September 17, 1992,
and successor proceedings.
``(2) Designated frequencies.--The term `designated frequency'
means each of the frequencies designated by the Commission for
licenses for advanced television services.
``(3) High definition television.--The term `high definition
television' refers to systems that offer approximately twice the
vertical and horizontal resolution of receivers generally available
on the date of enactment of the Telecommunications Act of 1996, as
further defined in the proceedings described in paragraph (1) of
this subsection.''.
SEC. 202. BROADCAST OWNERSHIP.
(a) National Radio Station Ownership Rule Changes Required.--The
Commission shall modify section 73.3555 of its regulations (47 C.F.R.
73.3555) by eliminating any provisions limiting the number of AM or FM
broadcast stations which may be owned or controlled by one entity
nationally.
(b) Local Radio Diversity.--
(1) Applicable caps.--The Commission shall revise section
73.3555(a) of its regulations (47 C.F.R. 73.3555) to provide that--
(A) in a radio market with 45 or more commercial radio
stations, a party may own, operate, or control up to 8
commercial radio stations, not more than 5 of which are in the
same service (AM or FM);
(B) in a radio market with between 30 and 44 (inclusive)
commercial radio stations, a party may own, operate, or control
up to 7 commercial radio stations, not more than 4 of which are
in the same service (AM or FM);
(C) in a radio market with between 15 and 29 (inclusive)
commercial radio stations, a party may own, operate, or control
up to 6 commercial radio stations, not more than 4 of which are
in the same service (AM or FM); and
(D) in a radio market with 14 or fewer commercial radio
stations, a party may own, operate, or control up to 5
commercial radio stations, not more than 3 of which are in the
same service (AM or FM), except that a party may not own,
operate, or control more than 50 percent of the stations in
such market.
(2) Exception.--Notwithstanding any limitation authorized by
this subsection, the Commission may permit a person or entity to
own, operate, or control, or have a cognizable interest in, radio
broadcast stations if the Commission determines that such
ownership, operation, control, or interest will result in an
increase in the number of radio broadcast stations in operation.
(c) Television Ownership Limitations.--
(1) National ownership limitations.--The Commission shall
modify its rules for multiple ownership set forth in section
73.3555 of its regulations (47 C.F.R. 73.3555)--
(A) by eliminating the restrictions on the number of
television stations that a person or entity may directly or
indirectly own, operate, or control, or have a cognizable
interest in, nationwide; and
(B) by increasing the national audience reach limitation
for television stations to 35 percent.
(2) Local ownership limitations.--The Commission shall conduct
a rulemaking proceeding to determine whether to retain, modify, or
eliminate its limitations on the number of television stations that
a person or entity may own, operate, or control, or have a
cognizable interest in, within the same television market.
(d) Relaxation of One-To-A-Market.--With respect to its enforcement
of its one-to-a-market ownership rules under section 73.3555 of its
regulations, the Commission shall extend its waiver policy to any of
the top 50 markets, consistent with the public interest, convenience,
and necessity.
(e) Dual Network Changes.--The Commission shall revise section
73.658(g) of its regulations (47 C.F.R. 658(g)) to permit a television
broadcast station to affiliate with a person or entity that maintains 2
or more networks of television broadcast stations unless such dual or
multiple networks are composed of--
(1) two or more persons or entities that, on the date of
enactment of the Telecommunications Act of 1996, are ``networks''
as defined in section 73.3613(a)(1) of the Commission's regulations
(47 C.F.R. 73.3613(a)(1)); or
(2) any network described in paragraph (1) and an English-
language program distribution service that, on such date, provides
4 or more hours of programming per week on a national basis
pursuant to network affiliation arrangements with local television
broadcast stations in markets reaching more than 75 percent of
television homes (as measured by a national ratings service).
(f) Cable Cross Ownership.--
(1) Elimination of restrictions.--The Commission shall revise
section 76.501 of its regulations (47 C.F.R. 76.501) to permit a
person or entity to own or control a network of broadcast stations
and a cable system.
(2) Safeguards against discrimination.--The Commission shall
revise such regulations if necessary to ensure carriage, channel
positioning, and nondiscriminatory treatment of nonaffiliated
broadcast stations by a cable system described in paragraph (1).
(g) Local Marketing Agreements.--Nothing in this section shall be
construed to prohibit the origination, continuation, or renewal of any
television local marketing agreement that is in compliance with the
regulations of the Commission.
(h) Further Commission Review.--The Commission shall review its
rules adopted pursuant to this section and all of its ownership rules
biennially as part of its regulatory reform review under section 11 of
the Communications Act of 1934 and shall determine whether any of such
rules are necessary in the public interest as the result of
competition. The Commission shall repeal or modify any regulation it
determines to be no longer in the public interest.
(i) Elimination of Statutory Restriction.--Section 613(a) (47
U.S.C. 533(a)) is amended--
(1) by striking paragraph (1);
(2) by redesignating paragraph (2) as subsection (a);
(3) by redesignating subparagraphs (A) and (B) as paragraphs
(1) and (2), respectively;
(4) by striking ``and'' at the end of paragraph (1) (as so
redesignated);
(5) by striking the period at the end of paragraph (2) (as so
redesignated) and inserting ``; and''; and
(6) by adding at the end the following new paragraph:
``(3) shall not apply the requirements of this subsection to
any cable operator in any franchise area in which a cable operator
is subject to effective competition as determined under section
623(l).''.
SEC. 203. TERM OF LICENSES.
Section 307(c) (47 U.S.C. 307(c)) is amended to read as follows:
``(c) Terms of Licenses.--
``(1) Initial and renewal licenses.--Each license granted for
the operation of a broadcasting station shall be for a term of not
to exceed 8 years. Upon application therefor, a renewal of such
license may be granted from time to time for a term of not to
exceed 8 years from the date of expiration of the preceding
license, if the Commission finds that public interest, convenience,
and necessity would be served thereby. Consistent with the
foregoing provisions of this subsection, the Commission may by rule
prescribe the period or periods for which licenses shall be granted
and renewed for particular classes of stations, but the Commission
may not adopt or follow any rule which would preclude it, in any
case involving a station of a particular class, from granting or
renewing a license for a shorter period than that prescribed for
stations of such class if, in its judgment, the public interest,
convenience, or necessity would be served by such action.
``(2) Materials in application.--In order to expedite action on
applications for renewal of broadcasting station licenses and in
order to avoid needless expense to applicants for such renewals,
the Commission shall not require any such applicant to file any
information which previously has been furnished to the Commission
or which is not directly material to the considerations that affect
the granting or denial of such application, but the Commission may
require any new or additional facts it deems necessary to make its
findings.
``(3) Continuation pending decision.--Pending any hearing and
final decision on such an application and the disposition of any
petition for rehearing pursuant to section 405, the Commission
shall continue such license in effect.''.
SEC. 204. BROADCAST LICENSE RENEWAL PROCEDURES.
(a) Renewal Procedures.--
(1) Amendment.--Section 309 (47 U.S.C. 309) is amended by
adding at the end thereof the following new subsection:
``(k) Broadcast Station Renewal Procedures.--
``(1) Standards for renewal.--If the licensee of a broadcast
station submits an application to the Commission for renewal of
such license, the Commission shall grant the application if it
finds, with respect to that station, during the preceding term of
its license--
``(A) the station has served the public interest,
convenience, and necessity;
``(B) there have been no serious violations by the licensee
of this Act or the rules and regulations of the Commission; and
``(C) there have been no other violations by the licensee
of this Act or the rules and regulations of the Commission
which, taken together, would constitute a pattern of abuse.
``(2) Consequence of failure to meet standard.--If any licensee
of a broadcast station fails to meet the requirements of this
subsection, the Commission may deny the application for renewal in
accordance with paragraph (3), or grant such application on terms
and conditions as are appropriate, including renewal for a term
less than the maximum otherwise permitted.
``(3) Standards for denial.--If the Commission determines,
after notice and opportunity for a hearing as provided in
subsection (e), that a licensee has failed to meet the requirements
specified in paragraph (1) and that no mitigating factors justify
the imposition of lesser sanctions, the Commission shall--
``(A) issue an order denying the renewal application filed
by such licensee under section 308; and
``(B) only thereafter accept and consider such applications
for a construction permit as may be filed under section 308
specifying the channel or broadcasting facilities of the former
licensee.
``(4) Competitor consideration prohibited.--In making the
determinations specified in paragraph (1) or (2), the Commission
shall not consider whether the public interest, convenience, and
necessity might be served by the grant of a license to a person
other than the renewal applicant.''.
(2) Conforming amendment.--Section 309(d) (47 U.S.C. 309(d)) is
amended by inserting after ``with subsection (a)'' each place it
appears the following: ``(or subsection (k) in the case of renewal
of any broadcast station license)''.
(b) Summary of Complaints on Violent Programming.--Section 308 (47
U.S.C. 308) is amended by adding at the end the following new
subsection:
``(d) Summary of Complaints.--Each applicant for the renewal of a
commercial or noncommercial television license shall attach as an
exhibit to the application a summary of written comments and
suggestions received from the public and maintained by the licensee (in
accordance with Commission regulations) that comment on the applicant's
programming, if any, and that are characterized by the commentor as
constituting violent programming.''.
(c) Effective Date.--The amendments made by this section apply to
applications filed after May 1, 1995.
SEC. 205. DIRECT BROADCAST SATELLITE SERVICE.
(a) DBS Signal Security.--Section 705(e)(4) (47 U.S.C. 605(e)(4))
is amended by inserting ``or direct-to-home satellite services,'' after
``programming,''.
(b) FCC Jurisdiction Over Direct-to-Home Satellite Services.--
Section 303 (47 U.S.C. 303) is amended by adding at the end thereof the
following new subsection:
``(v) Have exclusive jurisdiction to regulate the provision of
direct-to-home satellite services. As used in this subsection, the term
`direct-to-home satellite services' means the distribution or
broadcasting of programming or services by satellite directly to the
subscriber's premises without the use of ground receiving or
distribution equipment, except at the subscriber's premises or in the
uplink process to the satellite.''.
SEC. 206. AUTOMATED SHIP DISTRESS AND SAFETY SYSTEMS.
Part II of title III is amended by inserting after section 364 (47
U.S.C. 362) the following new section:
``SEC. 365. AUTOMATED SHIP DISTRESS AND SAFETY SYSTEMS.
``Notwithstanding any provision of this Act or any other provision
of law or regulation, a ship documented under the laws of the United
States operating in accordance with the Global Maritime Distress and
Safety System provisions of the Safety of Life at Sea Convention shall
not be required to be equipped with a radio telegraphy station operated
by one or more radio officers or operators. This section shall take
effect for each vessel upon a determination by the United States Coast
Guard that such vessel has the equipment required to implement the
Global Maritime Distress and Safety System installed and operating in
good working condition.''.
SEC. 207. RESTRICTIONS ON OVER-THE-AIR RECEPTION DEVICES.
Within 180 days after the date of enactment of this Act, the
Commission shall, pursuant to section 303 of the Communications Act of
1934, promulgate regulations to prohibit restrictions that impair a
viewer's ability to receive video programming services through devices
designed for over-the-air reception of television broadcast signals,
multichannel multipoint distribution service, or direct broadcast
satellite services.
TITLE III--CABLE SERVICES
SEC. 301. CABLE ACT REFORM.
(a) Definitions.--
(1) Definition of cable service.--Section 602(6)(B) (47 U.S.C.
522(6)(B)) is amended by inserting ``or use'' after ``the
selection''.
(2) Change in definition of cable system.--Section 602(7) (47
U.S.C. 522(7)) is amended by striking ``(B) a facility that serves
only subscribers in 1 or more multiple unit dwellings under common
ownership, control, or management, unless such facility or
facilities uses any public right-of-way;'' and inserting ``(B) a
facility that serves subscribers without using any public right-of-
way;''.
(b) Rate Deregulation.--
(1) Upper tier regulation.--Section 623(c) (47 U.S.C. 543(c))
is amended--
(A) in paragraph (1)(B), by striking ``subscriber,
franchising authority, or other relevant State or local
government entity'' and inserting ``franchising authority (in
accordance with paragraph (3))'';
(B) in paragraph (1)(C), by striking ``such complaint'' and
inserting ``the first complaint filed with the franchising
authority under paragraph (3)''; and
(C) by striking paragraph (3) and inserting the following:
``(3) Review of rate changes.--The Commission shall review any
complaint submitted by a franchising authority after the date of
enactment of the Telecommunications Act of 1996 concerning an
increase in rates for cable programming services and issue a final
order within 90 days after it receives such a complaint, unless the
parties agree to extend the period for such review. A franchising
authority may not file a complaint under this paragraph unless,
within 90 days after such increase becomes effective it receives
subscriber complaints.
``(4) Sunset of upper tier rate regulation.--This subsection
shall not apply to cable programming services provided after March
31, 1999.''.
(2) Sunset of uniform rate structure in markets with effective
competition.--Section 623(d) (47 U.S.C. 543(d)) is amended by
adding at the end thereof the following: ``This subsection does not
apply to (1) a cable operator with respect to the provision of
cable service over its cable system in any geographic area in which
the video programming services offered by the operator in that area
are subject to effective competition, or (2) any video programming
offered on a per channel or per program basis. Bulk discounts to
multiple dwelling units shall not be subject to this subsection,
except that a cable operator of a cable system that is not subject
to effective competition may not charge predatory prices to a
multiple dwelling unit. Upon a prima facie showing by a complainant
that there are reasonable grounds to believe that the discounted
price is predatory, the cable system shall have the burden of
showing that its discounted price is not predatory.''.
(3) Effective competition.--Section 623(l)(1) (47 U.S.C.
543(l)(1)) is amended--
(A) by striking ``or'' at the end of subparagraph (B);
(B) by striking the period at the end of subparagraph (C)
and inserting ``; or''; and
(C) by adding at the end the following:
``(D) a local exchange carrier or its affiliate (or any
multichannel video programming distributor using the facilities
of such carrier or its affiliate) offers video programming
services directly to subscribers by any means (other than
direct-to-home satellite services) in the franchise area of an
unaffiliated cable operator which is providing cable service in
that franchise area, but only if the video programming services
so offered in that area are comparable to the video programming
services provided by the unaffiliated cable operator in that
area.''.
(c) Greater Deregulation for Smaller Cable Companies.--Section 623
(47 U.S.C 543) is amended by adding at the end thereof the following:
``(m) Special Rules for Small Companies.--
``(1) In general.--Subsections (a), (b), and (c) do not apply
to a small cable operator with respect to--
``(A) cable programming services, or
``(B) a basic service tier that was the only service tier
subject to regulation as of December 31, 1994,
in any franchise area in which that operator services 50,000 or
fewer subscribers.
``(2) Definition of small cable operator.--For purposes of this
subsection, the term `small cable operator' means a cable operator
that, directly or through an affiliate, serves in the aggregate
fewer than 1 percent of all subscribers in the United States and is
not affiliated with any entity or entities whose gross annual
revenues in the aggregate exceed $250,000,000.''.
(d) Market Determinations.--
(1) Market determinations; expedited decisionmaking.--Section
614(h)(1)(C) (47 U.S.C. 534(h)(1)(C)) is amended--
(A) by striking ``in the manner provided in section
73.3555(d)(3)(i) of title 47, Code of Federal Regulations, as
in effect on May 1, 1991,'' in clause (i) and inserting ``by
the Commission by regulation or order using, where available,
commercial publications which delineate television markets
based on viewing patterns,''; and
(B) by striking clause (iv) and inserting the following:
``(iv) Within 120 days after the date on which a
request is filed under this subparagraph (or 120 days after
the date of enactment of the Telecommunications Act of
1996, if later), the Commission shall grant or deny the
request.''.
(2) Application to pending requests.--The amendment made by
paragraph (1) shall apply to--
(A) any request pending under section 614(h)(1)(C) of the
Communications Act of 1934 (47 U.S.C. 534(h)(1)(C)) on the date
of enactment of this Act; and
(B) any request filed under that section after that date.
(e) Technical Standards.--Section 624(e) (47 U.S.C. 544(e)) is
amended by striking the last two sentences and inserting the following:
``No State or franchising authority may prohibit, condition, or
restrict a cable system's use of any type of subscriber equipment or
any transmission technology.''.
(f) Cable Equipment Compatibility.--Section 624A (47 U.S.C. 544A)
is amended--
(1) in subsection (a) by striking ``and'' at the end of
paragraph (2), by striking the period at the end of paragraph (3)
and inserting ``; and''; and by adding at the end the following new
paragraph:
``(4) compatibility among televisions, video cassette
recorders, and cable systems can be assured with narrow technical
standards that mandate a minimum degree of common design and
operation, leaving all features, functions, protocols, and other
product and service options for selection through open competition
in the market.'';
(2) in subsection (c)(1)--
(A) by redesignating subparagraphs (A) and (B) as
subparagraphs (B) and (C), respectively; and
(B) by inserting before such redesignated subparagraph (B)
the following new subparagraph:
``(A) the need to maximize open competition in the market
for all features, functions, protocols, and other product and
service options of converter boxes and other cable converters
unrelated to the descrambling or decryption of cable television
signals;''; and
(3) in subsection (c)(2)--
(A) by redesignating subparagraphs (D) and (E) as
subparagraphs (E) and (F), respectively; and
(B) by inserting after subparagraph (C) the following new
subparagraph:
``(D) to ensure that any standards or regulations developed
under the authority of this section to ensure compatibility
between televisions, video cassette recorders, and cable
systems do not affect features, functions, protocols, and other
product and service options other than those specified in
paragraph (1)(B), including telecommunications interface
equipment, home automation communications, and computer network
services;''.
(g) Subscriber Notice.--Section 632 (47 U.S.C. 552) is amended--
(1) by redesignating subsection (c) as subsection (d); and
(2) by inserting after subsection (b) the following new
subsection:
``(c) Subscriber Notice.--A cable operator may provide notice of
service and rate changes to subscribers using any reasonable written
means at its sole discretion. Notwithstanding section 623(b)(6) or any
other provision of this Act, a cable operator shall not be required to
provide prior notice of any rate change that is the result of a
regulatory fee, franchise fee, or any other fee, tax, assessment, or
charge of any kind imposed by any Federal agency, State, or franchising
authority on the transaction between the operator and the
subscriber.''.
(h) Program Access.--Section 628 (47 U.S.C. 548) is amended by
adding at the end the following:
``(j) Common Carriers.--Any provision that applies to a cable
operator under this section shall apply to a common carrier or its
affiliate that provides video programming by any means directly to
subscribers. Any such provision that applies to a satellite cable
programming vendor in which a cable operator has an attributable
interest shall apply to any satellite cable programming vendor in which
such common carrier has an attributable interest. For the purposes of
this subsection, two or fewer common officers or directors shall not by
itself establish an attributable interest by a common carrier in a
satellite cable programming vendor (or its parent company).''.
(i) Antitrafficking.--Section 617 (47 U.S.C. 537) is amended--
(1) by striking subsections (a) through (d); and
(2) in subsection (e), by striking ``(e)'' and all that follows
through ``a franchising authority'' and inserting ``A franchising
authority''.
(j) Aggregation of Equipment Costs.--Section 623(a) (47 U.S.C.
543(a)) is amended by adding at the end the following new paragraph:
``(7) Aggregation of equipment costs.--
``(A) In general.--The Commission shall allow cable
operators, pursuant to any rules promulgated under subsection
(b)(3), to aggregate, on a franchise, system, regional, or
company level, their equipment costs into broad categories,
such as converter boxes, regardless of the varying levels of
functionality of the equipment within each such broad category.
Such aggregation shall not be permitted with respect to
equipment used by subscribers who receive only a rate regulated
basic service tier.
``(B) Revision to commission rules; forms.--Within 120 days
of the date of enactment of the Telecommunications Act of 1996,
the Commission shall issue revisions to the appropriate rules
and forms necessary to implement subparagraph (A).''.
(k) Treatment of Prior Year Losses.--
(1) Amendment.--Section 623 (48 U.S.C. 543) is amended by
adding at the end thereof the following:
``(n) Treatment of Prior Year Losses.--Notwithstanding any other
provision of this section or of section 612, losses associated with a
cable system (including losses associated with the grant or award of a
franchise) that were incurred prior to September 4, 1992, with respect
to a cable system that is owned and operated by the original franchisee
of such system shall not be disallowed, in whole or in part, in the
determination of whether the rates for any tier of service or any type
of equipment that is subject to regulation under this section are
lawful.''.
(2) Effective date.--The amendment made by paragraph (1) shall
take effect on the date of enactment of this Act and shall be
applicable to any rate proposal filed on or after September 4,
1993, upon which no final action has been taken by December 1,
1995.
SEC. 302. CABLE SERVICE PROVIDED BY TELEPHONE COMPANIES.
(a) Provisions for Regulation of Cable Service Provided by
Telephone Companies.--Title VI (47 U.S.C. 521 et seq.) is amended by
adding at the end the following new part:
``PART V--VIDEO PROGRAMMING SERVICES PROVIDED BY TELEPHONE COMPANIES
``SEC. 651. REGULATORY TREATMENT OF VIDEO PROGRAMMING SERVICES.
``(a) Limitations on Cable Regulation.--
``(1) Radio-based systems.--To the extent that a common carrier
(or any other person) is providing video programming to subscribers
using radio communication, such carrier (or other person) shall be
subject to the requirements of title III and section 652, but shall
not otherwise be subject to the requirements of this title.
``(2) Common carriage of video traffic.--To the extent that a
common carrier is providing transmission of video programming on a
common carrier basis, such carrier shall be subject to the
requirements of title II and section 652, but shall not otherwise
be subject to the requirements of this title. This paragraph shall
not affect the treatment under section 602(7)(C) of a facility of a
common carrier as a cable system.
``(3) Cable systems and open video systems.--To the extent that
a common carrier is providing video programming to its subscribers
in any manner other than that described in paragraphs (1) and (2)--
``(A) such carrier shall be subject to the requirements of
this title, unless such programming is provided by means of an
open video system for which the Commission has approved a
certification under section 653; or
``(B) if such programming is provided by means of an open
video system for which the Commission has approved a
certification under section 653, such carrier shall be subject
to the requirements of this part, but shall be subject to parts
I through IV of this title only as provided in 653(c).
``(4) Election to operate as open video system.--A common
carrier that is providing video programming in a manner described
in paragraph (1) or (2), or a combination thereof, may elect to
provide such programming by means of an open video system that
complies with section 653. If the Commission approves such
carrier's certification under section 653, such carrier shall be
subject to the requirements of this part, but shall be subject to
parts I through IV of this title only as provided in 653(c).
``(b) Limitations on Interconnection Obligations.--A local exchange
carrier that provides cable service through an open video system or a
cable system shall not be required, pursuant to title II of this Act,
to make capacity available on a nondiscriminatory basis to any other
person for the provision of cable service directly to subscribers.
``(c) Additional Regulatory Relief.--A common carrier shall not be
required to obtain a certificate under section 214 with respect to the
establishment or operation of a system for the delivery of video
programming.
``SEC. 652. PROHIBITION ON BUY OUTS.
``(a) Acquisitions by Carriers.--No local exchange carrier or any
affiliate of such carrier owned by, operated by, controlled by, or
under common control with such carrier may purchase or otherwise
acquire directly or indirectly more than a 10 percent financial
interest, or any management interest, in any cable operator providing
cable service within the local exchange carrier's telephone service
area.
``(b) Acquisitions by Cable Operators.--No cable operator or
affiliate of a cable operator that is owned by, operated by, controlled
by, or under common ownership with such cable operator may purchase or
otherwise acquire, directly or indirectly, more than a 10 percent
financial interest, or any management interest, in any local exchange
carrier providing telephone exchange service within such cable
operator's franchise area.
``(c) Joint Ventures.--A local exchange carrier and a cable
operator whose telephone service area and cable franchise area,
respectively, are in the same market may not enter into any joint
venture or partnership to provide video programming directly to
subscribers or to provide telecommunications services within such
market.
``(d) Exceptions.--
``(1) Rural systems.--Notwithstanding subsections (a), (b), and
(c) of this section, a local exchange carrier (with respect to a
cable system located in its telephone service area) and a cable
operator (with respect to the facilities of a local exchange
carrier used to provide telephone exchange service in its cable
franchise area) may obtain a controlling interest in, management
interest in, or enter into a joint venture or partnership with the
operator of such system or facilities for the use of such system or
facilities to the extent that--
``(A) such system or facilities only serve incorporated or
unincorporated--
``(i) places or territories that have fewer than 35,000
inhabitants; and
``(ii) are outside an urbanized area, as defined by the
Bureau of the Census; and
``(B) in the case of a local exchange carrier, such system,
in the aggregate with any other system in which such carrier
has an interest, serves less than 10 percent of the households
in the telephone service area of such carrier.
``(2) Joint use.--Notwithstanding subsection (c), a local
exchange carrier may obtain, with the concurrence of the cable
operator on the rates, terms, and conditions, the use of that part
of the transmission facilities of a cable system extending from the
last multi-user terminal to the premises of the end user, if such
use is reasonably limited in scope and duration, as determined by
the Commission.
``(3) Acquisitions in competitive markets.--Notwithstanding
subsections (a) and (c), a local exchange carrier may obtain a
controlling interest in, or form a joint venture or other
partnership with, or provide financing to, a cable system
(hereinafter in this paragraph referred to as `the subject cable
system'), if--
``(A) the subject cable system operates in a television
market that is not in the top 25 markets, and such market has
more than 1 cable system operator, and the subject cable system
is not the cable system with the most subscribers in such
television market;
``(B) the subject cable system and the cable system with
the most subscribers in such television market held on May 1,
1995, cable television franchises from the largest municipality
in the television market and the boundaries of such franchises
were identical on such date;
``(C) the subject cable system is not owned by or under
common ownership or control of any one of the 50 cable system
operators with the most subscribers as such operators existed
on May 1, 1995; and
``(D) the system with the most subscribers in the
television market is owned by or under common ownership or
control of any one of the 10 largest cable system operators as
such operators existed on May 1, 1995.
``(4) Exempt cable systems.--Subsection (a) does not apply to
any cable system if--
``(A) the cable system serves no more than 17,000 cable
subscribers, of which no less than 8,000 live within an urban
area, and no less than 6,000 live within a nonurbanized area as
of June 1, 1995;
``(B) the cable system is not owned by, or under common
ownership or control with, any of the 50 largest cable system
operators in existence on June 1, 1995; and
``(C) the cable system operates in a television market that
was not in the top 100 television markets as of June 1, 1995.
``(5) Small cable systems in nonurban areas.--Notwithstanding
subsections (a) and (c), a local exchange carrier with less than
$100,000,000 in annual operating revenues (or any affiliate of such
carrier owned by, operated by, controlled by, or under common
control with such carrier) may purchase or otherwise acquire more
than a 10 percent financial interest in, or any management interest
in, or enter into a joint venture or partnership with, any cable
system within the local exchange carrier's telephone service area
that serves no more than 20,000 cable subscribers, if no more than
12,000 of those subscribers live within an urbanized area, as
defined by the Bureau of the Census.
``(6) Waivers.--The Commission may waive the restrictions of
subsections (a), (b), or (c) only if--
``(A) the Commission determines that, because of the nature
of the market served by the affected cable system or facilities
used to provide telephone exchange service--
``(i) the affected cable operator or local exchange
carrier would be subjected to undue economic distress by
the enforcement of such provisions;
``(ii) the system or facilities would not be
economically viable if such provisions were enforced; or
``(iii) the anticompetitive effects of the proposed
transaction are clearly outweighed in the public interest
by the probable effect of the transaction in meeting the
convenience and needs of the community to be served; and
``(B) the local franchising authority approves of such
waiver.
``(e) Definition of Telephone Service Area.--For purposes of this
section, the term `telephone service area' when used in connection with
a common carrier subject in whole or in part to title II of this Act
means the area within which such carrier provided telephone exchange
service as of January 1, 1993, but if any common carrier after such
date transfers its telephone exchange service facilities to another
common carrier, the area to which such facilities provide telephone
exchange service shall be treated as part of the telephone service area
of the acquiring common carrier and not of the selling common carrier.
``SEC. 653. ESTABLISHMENT OF OPEN VIDEO SYSTEMS.
``(a) Open Video Systems.--
``(1) Certificates of compliance.--A local exchange carrier may
provide cable service to its cable service subscribers in its
telephone service area through an open video system that complies
with this section. To the extent permitted by such regulations as
the Commission may prescribe consistent with the public interest,
convenience, and necessity, an operator of a cable system or any
other person may provide video programming through an open video
system that complies with this section. An operator of an open
video system shall qualify for reduced regulatory burdens under
subsection (c) of this section if the operator of such system
certifies to the Commission that such carrier complies with the
Commission's regulations under subsection (b) and the Commission
approves such certification. The Commission shall publish notice of
the receipt of any such certification and shall act to approve or
disapprove any such certification within 10 days after receipt of
such certification.
``(2) Dispute resolution.--The Commission shall have the
authority to resolve disputes under this section and the
regulations prescribed thereunder. Any such dispute shall be
resolved within 180 days after notice of such dispute is submitted
to the Commission. At that time or subsequently in a separate
damages proceeding, the Commission may, in the case of any
violation of this section, require carriage, award damages to any
person denied carriage, or any combination of such sanctions. Any
aggrieved party may seek any other remedy available under this Act.
``(b) Commission Actions.--
``(1) Regulations required.--Within 6 months after the date of
enactment of the Telecommunications Act of 1996, the Commission
shall complete all actions necessary (including any
reconsideration) to prescribe regulations that--
``(A) except as required pursuant to section 611, 614, or
615, prohibit an operator of an open video system from
discriminating among video programming providers with regard to
carriage on its open video system, and ensure that the rates,
terms, and conditions for such carriage are just and
reasonable, and are not unjustly or unreasonably
discriminatory;
``(B) if demand exceeds the channel capacity of the open
video system, prohibit an operator of an open video system and
its affiliates from selecting the video programming services
for carriage on more than one-third of the activated channel
capacity on such system, but nothing in this subparagraph shall
be construed to limit the number of channels that the carrier
and its affiliates may offer to provide directly to
subscribers;
``(C) permit an operator of an open video system to carry
on only one channel any video programming service that is
offered by more than one video programming provider (including
the local exchange carrier's video programming affiliate):
Provided, That subscribers have ready and immediate access to
any such video programming service;
``(D) extend to the distribution of video programming over
open video systems the Commission's regulations concerning
sports exclusivity (47 C.F.R. 76.67), network nonduplication
(47 C.F.R. 76.92 et seq.), and syndicated exclusivity (47
C.F.R. 76.151 et seq.); and
``(E)(i) prohibit an operator of an open video system from
unreasonably discriminating in favor of the operator or its
affiliates with regard to material or information (including
advertising) provided by the operator to subscribers for the
purposes of selecting programming on the open video system, or
in the way such material or information is presented to
subscribers;
``(ii) require an operator of an open video system to
ensure that video programming providers or copyright holders
(or both) are able suitably and uniquely to identify their
programming services to subscribers;
``(iii) if such identification is transmitted as part of
the programming signal, require the carrier to transmit such
identification without change or alteration; and
``(iv) prohibit an operator of an open video system from
omitting television broadcast stations or other unaffiliated
video programming services carried on such system from any
navigational device, guide, or menu.
``(2) Consumer access.--Subject to the requirements of
paragraph (1) and the regulations thereunder, nothing in this
section prohibits a common carrier or its affiliate from
negotiating mutually agreeable terms and conditions with over-the-
air broadcast stations and other unaffiliated video programming
providers to allow consumer access to their signals on any level or
screen of any gateway, menu, or other program guide, whether
provided by the carrier or its affiliate.
``(c) Reduced Regulatory Burdens for Open Video Systems.--
``(1) In general.--Any provision that applies to a cable
operator under--
``(A) sections 613 (other than subsection (a) thereof),
616, 623(f), 628, 631, and 634 of this title, shall apply,
``(B) sections 611, 614, and 615 of this title, and section
325 of title III, shall apply in accordance with the
regulations prescribed under paragraph (2), and
``(C) sections 612 and 617, and parts III and IV (other
than sections 623(f), 628, 631, and 634), of this title shall
not apply,
to any operator of an open video system for which the Commission
has approved a certification under this section.
``(2) Implementation.--
``(A) Commission action.--In the rulemaking proceeding to
prescribe the regulations required by subsection (b)(1), the
Commission shall, to the extent possible, impose obligations
that are no greater or lesser than the obligations contained in
the provisions described in paragraph (1)(B) of this
subsection. The Commission shall complete all action (including
any reconsideration) to prescribe such regulations no later
than 6 months after the date of enactment of the
Telecommunications Act of 1996.
``(B) Fees.--An operator of an open video system under this
part may be subject to the payment of fees on the gross
revenues of the operator for the provision of cable service
imposed by a local franchising authority or other governmental
entity, in lieu of the franchise fees permitted under section
622. The rate at which such fees are imposed shall not exceed
the rate at which franchise fees are imposed on any cable
operator transmitting video programming in the franchise area,
as determined in accordance with regulations prescribed by the
Commission. An operator of an open video system may designate
that portion of a subscriber's bill attributable to the fee
under this subparagraph as a separate item on the bill.
``(3) Regulatory streamlining.--With respect to the
establishment and operation of an open video system, the
requirements of this section shall apply in lieu of, and not in
addition to, the requirements of title II.
``(4) Treatment as cable operator.--Nothing in this Act
precludes a video programming provider making use of an open video
system from being treated as an operator of a cable system for
purposes of section 111 of title 17, United States Code.
``(d) Definition of Telephone Service Area.--For purposes of this
section, the term `telephone service area' when used in connection with
a common carrier subject in whole or in part to title II of this Act
means the area within which such carrier is offering telephone exchange
service.''.
(b) Conforming and Technical Amendments.--
(1) Repeal.--Subsection (b) of section 613 (47 U.S.C. 533(b))
is repealed.
(2) Definitions.--Section 602 (47 U.S.C. 531) is amended--
(A) in paragraph (7), by striking ``, or (D)'' and
inserting the following: ``, unless the extent of such use is
solely to provide interactive on-demand services; (D) an open
video system that complies with section 653 of this title; or
(E)'';
(B) by redesignating paragraphs (12) through (19) as
paragraphs (13) through (20), respectively; and
(C) by inserting after paragraph (11) the following new
paragraph:
``(12) the term `interactive on-demand services' means a
service providing video programming to subscribers over switched
networks on an on-demand, point-to-point basis, but does not
include services providing video programming prescheduled by the
programming provider;''.
(3) Termination of video-dialtone regulations.--The
Commission's regulations and policies with respect to video
dialtone requirements issued in CC Docket No. 87-266 shall cease to
be effective on the date of enactment of this Act. This paragraph
shall not be construed to require the termination of any video-
dialtone system that the Commission has approved before the date of
enactment of this Act.
SEC. 303. PREEMPTION OF FRANCHISING AUTHORITY REGULATION OF
TELECOMMUNICATIONS SERVICES.
(a) Provision of Telecommunications Services by a Cable Operator.--
Section 621(b) (47 U.S.C. 541(b)) is amended by adding at the end
thereof the following new paragraph:
``(3)(A) If a cable operator or affiliate thereof is engaged in the
provision of telecommunications services--
``(i) such cable operator or affiliate shall not be required to
obtain a franchise under this title for the provision of
telecommunications services; and
``(ii) the provisions of this title shall not apply to such
cable operator or affiliate for the provision of telecommunications
services.
``(B) A franchising authority may not impose any requirement under
this title that has the purpose or effect of prohibiting, limiting,
restricting, or conditioning the provision of a telecommunications
service by a cable operator or an affiliate thereof.
``(C) A franchising authority may not order a cable operator or
affiliate thereof--
``(i) to discontinue the provision of a telecommunications
service, or
``(ii) to discontinue the operation of a cable system, to the
extent such cable system is used for the provision of a
telecommunications service, by reason of the failure of such cable
operator or affiliate thereof to obtain a franchise or franchise
renewal under this title with respect to the provision of such
telecommunications service.
``(D) Except as otherwise permitted by sections 611 and 612, a
franchising authority may not require a cable operator to provide any
telecommunications service or facilities, other than institutional
networks, as a condition of the initial grant of a franchise, a
franchise renewal, or a transfer of a franchise.''.
(b) Franchise Fees.--Section 622(b) (47 U.S.C. 542(b)) is amended
by inserting ``to provide cable services'' immediately before the
period at the end of the first sentence thereof.
SEC. 304. COMPETITIVE AVAILABILITY OF NAVIGATION DEVICES.
Part III of title VI is amended by inserting after section 628 (47
U.S.C. 548) the following new section:
``SEC. 629. COMPETITIVE AVAILABILITY OF NAVIGATION DEVICES.
``(a) Commercial Consumer Availability of Equipment Used To Access
Services Provided by Multichannel Video Programming Distributors.--The
Commission shall, in consultation with appropriate industry standard-
setting organizations, adopt regulations to assure the commercial
availability, to consumers of multichannel video programming and other
services offered over multichannel video programming systems, of
converter boxes, interactive communications equipment, and other
equipment used by consumers to access multichannel video programming
and other services offered over multichannel video programming systems,
from manufacturers, retailers, and other vendors not affiliated with
any multichannel video programming distributor. Such regulations shall
not prohibit any multichannel video programming distributor from also
offering converter boxes, interactive communications equipment, and
other equipment used by consumers to access multichannel video
programming and other services offered over multichannel video
programming systems, to consumers, if the system operator's charges to
consumers for such devices and equipment are separately stated and not
subsidized by charges for any such service.
``(b) Protection of System Security.--The Commission shall not
prescribe regulations under subsection (a) which would jeopardize
security of multichannel video programming and other services offered
over multichannel video programming systems, or impede the legal rights
of a provider of such services to prevent theft of service.
``(c) Waiver.--The Commission shall waive a regulation adopted
under subsection (a) for a limited time upon an appropriate showing by
a provider of multichannel video programming and other services offered
over multichannel video programming systems, or an equipment provider,
that such waiver is necessary to assist the development or introduction
of a new or improved multichannel video programming or other service
offered over multichannel video programming systems, technology, or
products. Upon an appropriate showing, the Commission shall grant any
such waiver request within 90 days of any application filed under this
subsection, and such waiver shall be effective for all service
providers and products in that category and for all providers of
services and products.
``(d) Avoidance of Redundant Regulations.--
``(1) Commercial availability determinations.--Determinations
made or regulations prescribed by the Commission with respect to
commercial availability to consumers of converter boxes,
interactive communications equipment, and other equipment used by
consumers to access multichannel video programming and other
services offered over multichannel video programming systems,
before the date of enactment of the Telecommunications Act of 1996
shall fulfill the requirements of this section.
``(2) Regulations.--Nothing in this section affects section
64.702(e) of the Commission's regulations (47 C.F.R. 64.702(e)) or
other Commission regulations governing interconnection and
competitive provision of customer premises equipment used in
connection with basic common carrier communications services.
``(e) Sunset.--The regulations adopted under this section shall
cease to apply when the Commission determines that--
``(1) the market for the multichannel video programming
distributors is fully competitive;
``(2) the market for converter boxes, and interactive
communications equipment, used in conjunction with that service is
fully competitive; and
``(3) elimination of the regulations would promote competition
and the public interest.
``(f) Commission's Authority.--Nothing in this section shall be
construed as expanding or limiting any authority that the Commission
may have under law in effect before the date of enactment of the
Telecommunications Act of 1996.''.
SEC. 305. VIDEO PROGRAMMING ACCESSIBILITY.
Title VII is amended by inserting after section 712 (47 U.S.C. 612)
the following new section:
``SEC. 713. VIDEO PROGRAMMING ACCESSIBILITY.
``(a) Commission Inquiry.--Within 180 days after the date of
enactment of the Telecommunications Act of 1996, the Federal
Communications Commission shall complete an inquiry to ascertain the
level at which video programming is closed captioned. Such inquiry
shall examine the extent to which existing or previously published
programming is closed captioned, the size of the video programming
provider or programming owner providing closed captioning, the size of
the market served, the relative audience shares achieved, or any other
related factors. The Commission shall submit to the Congress a report
on the results of such inquiry.
``(b) Accountability Criteria.--Within 18 months after such date of
enactment, the Commission shall prescribe such regulations as are
necessary to implement this section. Such regulations shall ensure
that--
``(1) video programming first published or exhibited after the
effective date of such regulations is fully accessible through the
provision of closed captions, except as provided in subsection (d);
and
``(2) video programming providers or owners maximize the
accessibility of video programming first published or exhibited
prior to the effective date of such regulations through the
provision of closed captions, except as provided in subsection (d).
``(c) Deadlines for Captioning.--Such regulations shall include an
appropriate schedule of deadlines for the provision of closed
captioning of video programming.
``(d) Exemptions.--Notwithstanding subsection (b)--
``(1) the Commission may exempt by regulation programs, classes
of programs, or services for which the Commission has determined
that the provision of closed captioning would be economically
burdensome to the provider or owner of such programming;
``(2) a provider of video programming or the owner of any
program carried by the provider shall not be obligated to supply
closed captions if such action would be inconsistent with contracts
in effect on the date of enactment of the Telecommunications Act of
1996, except that nothing in this section shall be construed to
relieve a video programming provider of its obligations to provide
services required by Federal law; and
``(3) a provider of video programming or program owner may
petition the Commission for an exemption from the requirements of
this section, and the Commission may grant such petition upon a
showing that the requirements contained in this section would
result in an undue burden.
``(e) Undue Burden.--The term `undue burden' means significant
difficulty or expense. In determining whether the closed captions
necessary to comply with the requirements of this paragraph would
result in an undue economic burden, the factors to be considered
include--
``(1) the nature and cost of the closed captions for the
programming;
``(2) the impact on the operation of the provider or program
owner;
``(3) the financial resources of the provider or program owner;
and
``(4) the type of operations of the provider or program owner.
``(f) Video Descriptions Inquiry.--Within 6 months after the date
of enactment of the Telecommunications Act of 1996, the Commission
shall commence an inquiry to examine the use of video descriptions on
video programming in order to ensure the accessibility of video
programming to persons with visual impairments, and report to Congress
on its findings. The Commission's report shall assess appropriate
methods and schedules for phasing video descriptions into the
marketplace, technical and quality standards for video descriptions, a
definition of programming for which video descriptions would apply, and
other technical and legal issues that the Commission deems appropriate.
``(g) Video Description.--For purposes of this section, `video
description' means the insertion of audio narrated descriptions of a
television program's key visual elements into natural pauses between
the program's dialogue.
``(h) Private Rights of Actions Prohibited.--Nothing in this
section shall be construed to authorize any private right of action to
enforce any requirement of this section or any regulation thereunder.
The Commission shall have exclusive jurisdiction with respect to any
complaint under this section.''.
TITLE IV--REGULATORY REFORM
SEC. 401. REGULATORY FORBEARANCE.
Title I is amended by inserting after section 9 (47 U.S.C. 159) the
following new section:
``SEC. 10. COMPETITION IN PROVISION OF TELECOMMUNICATIONS SERVICE.
``(a) Regulatory flexibility.--Notwithstanding section 332(c)(1)(A)
of this Act, the Commission shall forbear from applying any regulation
or any provision of this Act to a telecommunications carrier or
telecommunications service, or class of telecommunications carriers or
telecommunications services, in any or some of its or their geographic
markets, if the Commission determines that--
``(1) enforcement of such regulation or provision is not
necessary to ensure that the charges, practices, classifications,
or regulations by, for, or in connection with that
telecommunications carrier or telecommunications service are just
and reasonable and are not unjustly or unreasonably discriminatory;
``(2) enforcement of such regulation or provision is not
necessary for the protection of consumers; and
``(3) forbearance from applying such provision or regulation is
consistent with the public interest.
``(b) Competitive Effect To Be Weighed.--In making the
determination under subsection (a)(3), the Commission shall consider
whether forbearance from enforcing the provision or regulation will
promote competitive market conditions, including the extent to which
such forbearance will enhance competition among providers of
telecommunications services. If the Commission determines that such
forbearance will promote competition among providers of
telecommunications services, that determination may be the basis for a
Commission finding that forbearance is in the public interest.
``(c) Petition for Forbearance.--Any telecommunications carrier, or
class of telecommunications carriers, may submit a petition to the
Commission requesting that the Commission exercise the authority
granted under this section with respect to that carrier or those
carriers, or any service offered by that carrier or carriers. Any such
petition shall be deemed granted if the Commission does not deny the
petition for failure to meet the requirements for forbearance under
subsection (a) within one year after the Commission receives it, unless
the one-year period is extended by the Commission. The Commission may
extend the initial one-year period by an additional 90 days if the
Commission finds that an extension is necessary to meet the
requirements of subsection (a). The Commission may grant or deny a
petition in whole or in part and shall explain its decision in writing.
``(d) Limitation.--Except as provided in section 251(f), the
Commission may not forbear from applying the requirements of section
251(c) or 271 under subsection (a) of this section until it determines
that those requirements have been fully implemented.
``(e) State Enforcement After Commission Forbearance.--A State
commission may not continue to apply or enforce any provision of this
Act that the Commission has determined to forbear from applying under
subsection (a).''.
SEC. 402. BIENNIAL REVIEW OF REGULATIONS; REGULATORY RELIEF.
(a) Biennial Review.--Title I is amended by inserting after section
10 (as added by section 401) the following new section:
``SEC. 11. REGULATORY REFORM.
``(a) Biennial Review of Regulations.--In every even-numbered year
(beginning with 1998), the Commission--
``(1) shall review all regulations issued under this Act in
effect at the time of the review that apply to the operations or
activities of any provider of telecommunications service; and
``(2) shall determine whether any such regulation is no longer
necessary in the public interest as the result of meaningful
economic competition between providers of such service.
``(b) Effect of Determination.--The Commission shall repeal or
modify any regulation it determines to be no longer necessary in the
public interest.''.
(b) Regulatory Relief.--
(1) Streamlined procedures for changes in charges,
classifications, regulations, or practices.--
(A) Section 204(a) (47 U.S.C. 204(a)) is amended--
(i) by striking ``12 months'' the first place it
appears in paragraph (2)(A) and inserting ``5 months'';
(ii) by striking ``effective,'' and all that follows in
paragraph (2)(A) and inserting ``effective.''; and
(iii) by adding at the end thereof the following:
``(3) A local exchange carrier may file with the Commission a
new or revised charge, classification, regulation, or practice on a
streamlined basis. Any such charge, classification, regulation, or
practice shall be deemed lawful and shall be effective 7 days (in
the case of a reduction in rates) or 15 days (in the case of an
increase in rates) after the date on which it is filed with the
Commission unless the Commission takes action under paragraph (1)
before the end of that 7-day or 15-day period, as is
appropriate.''.
(B) Section 208(b) (47 U.S.C. 208(b)) is amended--
(i) by striking ``12 months'' the first place it
appears in paragraph (1) and inserting ``5 months''; and
(ii) by striking ``filed,'' and all that follows in
paragraph (1) and inserting ``filed.''.
(2) Extensions of lines under section 214; armis reports.--The
Commission shall permit any common carrier--
(A) to be exempt from the requirements of section 214 of
the Communications Act of 1934 for the extension of any line;
and
(B) to file cost allocation manuals and ARMIS reports
annually, to the extent such carrier is required to file such
manuals or reports.
(3) Forbearance authority not limited.--Nothing in this
subsection shall be construed to limit the authority of the
Commission to waive, modify, or forbear from applying any of the
requirements to which reference is made in paragraph (1) under any
other provision of this Act or other law.
(4) Effective date of amendments.--The amendments made by
paragraph (1) of this subsection shall apply with respect to any
charge, classification, regulation, or practice filed on or after
one year after the date of enactment of this Act.
(c) Classification of Carriers.--In classifying carriers according
to section 32.11 of its regulations (47 C.F.R. 32.11) and in
establishing reporting requirements pursuant to part 43 of its
regulations (47 C.F.R. part 43) and section 64.903 of its regulations
(47 C.F.R. 64.903), the Commission shall adjust the revenue
requirements to account for inflation as of the release date of the
Commission's Report and Order in CC Docket No. 91-141, and annually
thereafter. This subsection shall take effect on the date of enactment
of this Act.
SEC. 403. ELIMINATION OF UNNECESSARY COMMISSION REGULATIONS AND
FUNCTIONS.
(a) Modification of Amateur Radio Examination Procedures.--Section
4(f)(4) (47 U.S.C. 154(f)(4)) is amended--
(1) in subparagraph (A)--
(A) by inserting ``or administering'' after ``for purposes
of preparing'';
(B) by inserting ``of'' after ``than the class''; and
(C) by inserting ``or administered'' after ``for which the
examination is being prepared'';
(2) by striking subparagraph (B);
(3) in subparagraph (H), by striking ``(A), (B), and (C)'' and
inserting ``(A) and (B)'';
(4) in subparagraph (J)--
(A) by striking ``or (B)''; and
(B) by striking the last sentence; and
(5) by redesignating subparagraphs (C) through (J) as
subparagraphs (B) through (I), respectively.
(b) Authority To Designate Entities To Inspect.--Section 4(f)(3)
(47 U.S.C. 154(f)(3)) is amended by inserting before the period at the
end the following: ``: and Provided further, That, in the alternative,
an entity designated by the Commission may make the inspections
referred to in this paragraph''.
(c) Expediting Instructional Television Fixed Service Processing.--
Section 5(c)(1) (47 U.S.C. 155(c)(1)) is amended by striking the last
sentence and inserting the following: ``Except for cases involving the
authorization of service in the instructional television fixed service,
or as otherwise provided in this Act, nothing in this paragraph shall
authorize the Commission to provide for the conduct, by any person or
persons other than persons referred to in paragraph (2) or (3) of
section 556(b) of title 5, United States Code, of any hearing to which
such section applies.''.
(d) Repeal Setting of Depreciation Rates.--The first sentence of
section 220(b) (47 U.S.C. 220(b)) is amended by striking ``shall
prescribe for such carriers'' and inserting ``may prescribe, for such
carriers as it determines to be appropriate,''.
(e) Use of Independent Auditors.--Section 220(c) (47 U.S.C. 220(c))
is amended by adding at the end thereof the following: ``The Commission
may obtain the services of any person licensed to provide public
accounting services under the law of any State to assist with, or
conduct, audits under this section. While so employed or engaged in
conducting an audit for the Commission under this section, any such
person shall have the powers granted the Commission under this
subsection and shall be subject to subsection (f) in the same manner as
if that person were an employee of the Commission.''.
(f) Delegation of Equipment Testing and Certification to Private
Laboratories.--Section 302 (47 U.S.C. 302) is amended by adding at the
end the following:
``(e) The Commission may--
``(1) authorize the use of private organizations for testing
and certifying the compliance of devices or home electronic
equipment and systems with regulations promulgated under this
section;
``(2) accept as prima facie evidence of such compliance the
certification by any such organization; and
``(3) establish such qualifications and standards as it deems
appropriate for such private organizations, testing, and
certification.''.
(g) Making License Modification Uniform.--Section 303(f) (47 U.S.C.
303(f)) is amended by striking ``unless, after a public hearing,'' and
inserting ``unless''.
(h) Eliminate FCC Jurisdiction Over Government-Owned Ship Radio
Stations.--
(1) Section 305 (47 U.S.C. 305) is amended by striking
subsection (b) and redesignating subsections (c) and (d) as (b) and
(c), respectively.
(2) Section 382(2) (47 U.S.C. 382(2)) is amended by striking
``except a vessel of the United States Maritime Administration, the
Inland and Coastwise Waterways Service, or the Panama Canal
Company,''.
(i) Permit Operation of Domestic Ship and Aircraft Radios Without
License.--Section 307(e) (47 U.S.C. 307(e)) is amended to read as
follows:
``(e)(1) Notwithstanding any license requirement established in
this Act, if the Commission determines that such authorization serves
the public interest, convenience, and necessity, the Commission may by
rule authorize the operation of radio stations without individual
licenses in the following radio services: (A) the citizens band radio
service; (B) the radio control service; (C) the aviation radio service
for aircraft stations operated on domestic flights when such aircraft
are not otherwise required to carry a radio station; and (D) the
maritime radio service for ship stations navigated on domestic voyages
when such ships are not otherwise required to carry a radio station.
``(2) Any radio station operator who is authorized by the
Commission to operate without an individual license shall comply with
all other provisions of this Act and with rules prescribed by the
Commission under this Act.
``(3) For purposes of this subsection, the terms `citizens band
radio service', `radio control service', `aircraft station' and `ship
station' shall have the meanings given them by the Commission by
rule.''.
(j) Expedited Licensing for Fixed Microwave Service.--Section
309(b)(2) (47 U.S.C. 309(b)(2)) is amended by striking subparagraph (A)
and redesignating subparagraphs (B) through (G) as subparagraphs (A)
through (F), respectively.
(k) Foreign Directors.--Section 310(b) (47 U.S.C. 310(b)) is
amended--
(1) in paragraph (3), by striking ``of which any officer or
director is an alien or''; and
(2) in paragraph (4), by striking ``of which any officer or
more than one-fourth of the directors are aliens, or''.
(l) Limitation on Silent Station Authorizations.--Section 312 (47
U.S.C. 312) is amended by adding at the end the following:
``(g) If a broadcasting station fails to transmit broadcast signals
for any consecutive 12-month period, then the station license granted
for the operation of that broadcast station expires at the end of that
period, notwithstanding any provision, term, or condition of the
license to the contrary.''.
(m) Modification of Construction Permit Requirement.--Section
319(d) is amended by striking the last two sentences and inserting the
following: ``With respect to any broadcasting station, the Commission
shall not have any authority to waive the requirement of a permit for
construction, except that the Commission may by regulation determine
that a permit shall not be required for minor changes in the facilities
of authorized broadcast stations. With respect to any other station or
class of stations, the Commission shall not waive the requirement for a
construction permit unless the Commission determines that the public
interest, convenience, and necessity would be served by such a
waiver.''.
(n) Conduct of Inspections.--Section 362(b) (47 U.S.C. 362(b)) is
amended to read as follows:
``(b) Every ship of the United States that is subject to this part
shall have the equipment and apparatus prescribed therein inspected at
least once each year by the Commission or an entity designated by the
Commission. If, after such inspection, the Commission is satisfied that
all relevant provisions of this Act and the station license have been
complied with, the fact shall be so certified on the station license by
the Commission. The Commission shall make such additional inspections
at frequent intervals as the Commission determines may be necessary to
ensure compliance with the requirements of this Act. The Commission
may, upon a finding that the public interest could be served thereby--
``(1) waive the annual inspection required under this section
for a period of up to 90 days for the sole purpose of enabling a
vessel to complete its voyage and proceed to a port in the United
States where an inspection can be held; or
``(2) waive the annual inspection required under this section
for a vessel that is in compliance with the radio provisions of the
Safety Convention and that is operating solely in waters beyond the
jurisdiction of the United States: Provided, That such inspection
shall be performed within 30 days of such vessel's return to the
United States.''.
(o) Inspection by Other Entities.--Section 385 (47 U.S.C. 385) is
amended--
(1) by inserting ``or an entity designated by the Commission''
after ``The Commission''; and
(2) by adding at the end thereof the following: ``In accordance
with such other provisions of law as apply to Government contracts,
the Commission may enter into contracts with any person for the
purpose of carrying out such inspections and certifying compliance
with those requirements, and may, as part of any such contract,
allow any such person to accept reimbursement from the license
holder for travel and expense costs of any employee conducting an
inspection or certification.''.
TITLE V--OBSCENITY AND VIOLENCE
Subtitle A--Obscene, Harassing, and Wrongful Utilization of
Telecommunications Facilities
SEC. 501. SHORT TITLE.
This title may be cited as the ``Communications Decency Act of
1996''.
SEC. 502. OBSCENE OR HARASSING USE OF TELECOMMUNICATIONS FACILITIES
UNDER THE COMMUNICATIONS ACT OF 1934.
Section 223 (47 U.S.C. 223) is amended--
(1) by striking subsection (a) and inserting in lieu thereof:
``(a) Whoever--
``(1) in interstate or foreign communications--
``(A) by means of a telecommunications device knowingly--
``(i) makes, creates, or solicits, and
``(ii) initiates the transmission of,
any comment, request, suggestion, proposal, image, or other
communication which is obscene, lewd, lascivious, filthy, or
indecent, with intent to annoy, abuse, threaten, or harass
another person;
``(B) by means of a telecommunications device knowingly--
``(i) makes, creates, or solicits, and
``(ii) initiates the transmission of,
any comment, request, suggestion, proposal, image, or other
communication which is obscene or indecent, knowing that the
recipient of the communication is under 18 years of age,
regardless of whether the maker of such communication placed
the call or initiated the communication;
``(C) makes a telephone call or utilizes a
telecommunications device, whether or not conversation or
communication ensues, without disclosing his identity and with
intent to annoy, abuse, threaten, or harass any person at the
called number or who receives the communications;
``(D) makes or causes the telephone of another repeatedly
or continuously to ring, with intent to harass any person at
the called number; or
``(E) makes repeated telephone calls or repeatedly
initiates communication with a telecommunications device,
during which conversation or communication ensues, solely to
harass any person at the called number or who receives the
communication; or
``(2) knowingly permits any telecommunications facility under
his control to be used for any activity prohibited by paragraph (1)
with the intent that it be used for such activity,
shall be fined under title 18, United States Code, or imprisoned not
more than two years, or both.''; and
(2) by adding at the end the following new subsections:
``(d) Whoever--
``(1) in interstate or foreign communications knowingly--
``(A) uses an interactive computer service to send to a
specific person or persons under 18 years of age, or
``(B) uses any interactive computer service to display in a
manner available to a person under 18 years of age,
any comment, request, suggestion, proposal, image, or other
communication that, in context, depicts or describes, in terms
patently offensive as measured by contemporary community standards,
sexual or excretory activities or organs, regardless of whether the
user of such service placed the call or initiated the
communication; or
``(2) knowingly permits any telecommunications facility under
such person's control to be used for an activity prohibited by
paragraph (1) with the intent that it be used for such activity,
shall be fined under title 18, United States Code, or imprisoned not
more than two years, or both.
``(e) In addition to any other defenses available by law:
``(1) No person shall be held to have violated subsection (a)
or (d) solely for providing access or connection to or from a
facility, system, or network not under that person's control,
including transmission, downloading, intermediate storage, access
software, or other related capabilities that are incidental to
providing such access or connection that does not include the
creation of the content of the communication.
``(2) The defenses provided by paragraph (1) of this subsection
shall not be applicable to a person who is a conspirator with an
entity actively involved in the creation or knowing distribution of
communications that violate this section, or who knowingly
advertises the availability of such communications.
``(3) The defenses provided in paragraph (1) of this subsection
shall not be applicable to a person who provides access or
connection to a facility, system, or network engaged in the
violation of this section that is owned or controlled by such
person.
``(4) No employer shall be held liable under this section for
the actions of an employee or agent unless the employee's or
agent's conduct is within the scope of his or her employment or
agency and the employer (A) having knowledge of such conduct,
authorizes or ratifies such conduct, or (B) recklessly disregards
such conduct.
``(5) It is a defense to a prosecution under subsection
(a)(1)(B) or (d), or under subsection (a)(2) with respect to the
use of a facility for an activity under subsection (a)(1)(B) that a
person--
``(A) has taken, in good faith, reasonable, effective, and
appropriate actions under the circumstances to restrict or
prevent access by minors to a communication specified in such
subsections, which may involve any appropriate measures to
restrict minors from such communications, including any method
which is feasible under available technology; or
``(B) has restricted access to such communication by
requiring use of a verified credit card, debit account, adult
access code, or adult personal identification number.
``(6) The Commission may describe measures which are
reasonable, effective, and appropriate to restrict access to
prohibited communications under subsection (d). Nothing in this
section authorizes the Commission to enforce, or is intended to
provide the Commission with the authority to approve, sanction, or
permit, the use of such measures. The Commission shall have no
enforcement authority over the failure to utilize such measures.
The Commission shall not endorse specific products relating to such
measures. The use of such measures shall be admitted as evidence of
good faith efforts for purposes of paragraph (5) in any action
arising under subsection (d). Nothing in this section shall be
construed to treat interactive computer services as common carriers
or telecommunications carriers.
``(f)(1) No cause of action may be brought in any court or
administrative agency against any person on account of any activity
that is not in violation of any law punishable by criminal or civil
penalty, and that the person has taken in good faith to implement a
defense authorized under this section or otherwise to restrict or
prevent the transmission of, or access to, a communication specified in
this section.
``(2) No State or local government may impose any liability for
commercial activities or actions by commercial entities, nonprofit
libraries, or institutions of higher education in connection with an
activity or action described in subsection (a)(2) or (d) that is
inconsistent with the treatment of those activities or actions under
this section: Provided, however, That nothing herein shall preclude any
State or local government from enacting and enforcing complementary
oversight, liability, and regulatory systems, procedures, and
requirements, so long as such systems, procedures, and requirements
govern only intrastate services and do not result in the imposition of
inconsistent rights, duties or obligations on the provision of
interstate services. Nothing in this subsection shall preclude any
State or local government from governing conduct not covered by this
section.
``(g) Nothing in subsection (a), (d), (e), or (f) or in the
defenses to prosecution under subsection (a) or (d) shall be construed
to affect or limit the application or enforcement of any other Federal
law.
``(h) For purposes of this section--
``(1) The use of the term `telecommunications device' in this
section--
``(A) shall not impose new obligations on broadcasting
station licensees and cable operators covered by obscenity and
indecency provisions elsewhere in this Act; and
``(B) does not include an interactive computer service.
``(2) The term `interactive computer service' has the meaning
provided in section 230(e)(2).
``(3) The term `access software' means software (including
client or server software) or enabling tools that do not create or
provide the content of the communication but that allow a user to
do any one or more of the following:
``(A) filter, screen, allow, or disallow content;
``(B) pick, choose, analyze, or digest content; or
``(C) transmit, receive, display, forward, cache, search,
subset, organize, reorganize, or translate content.
``(4) The term `institution of higher education' has the
meaning provided in section 1201 of the Higher Education Act of
1965 (20 U.S.C. 1141).
``(5) The term `library' means a library eligible for
participation in State-based plans for funds under title III of the
Library Services and Construction Act (20 U.S.C. 355e et seq.).''.
SEC. 503. OBSCENE PROGRAMMING ON CABLE TELEVISION.
Section 639 (47 U.S.C. 559) is amended by striking ``not more than
$10,000'' and inserting ``under title 18, United States Code,''.
SEC. 504. SCRAMBLING OF CABLE CHANNELS FOR NONSUBSCRIBERS.
Part IV of title VI (47 U.S.C. 551 et seq.) is amended by adding at
the end the following:
``SEC. 640. SCRAMBLING OF CABLE CHANNELS FOR NONSUBSCRIBERS.
``(a) Subscriber Request.--Upon request by a cable service
subscriber, a cable operator shall, without charge, fully scramble or
otherwise fully block the audio and video programming of each channel
carrying such programming so that one not a subscriber does not receive
it.
``(b) Definition.--As used in this section, the term `scramble'
means to rearrange the content of the signal of the programming so that
the programming cannot be viewed or heard in an understandable
manner.''.
SEC. 505. SCRAMBLING OF SEXUALLY EXPLICIT ADULT VIDEO SERVICE
PROGRAMMING.
(a) Requirement.--Part IV of title VI (47 U.S.C. 551 et seq.), as
amended by this Act, is further amended by adding at the end the
following:
``SEC. 641. SCRAMBLING OF SEXUALLY EXPLICIT ADULT VIDEO SERVICE
PROGRAMMING.
``(a) Requirement.--In providing sexually explicit adult
programming or other programming that is indecent on any channel of its
service primarily dedicated to sexually-oriented programming, a
multichannel video programming distributor shall fully scramble or
otherwise fully block the video and audio portion of such channel so
that one not a subscriber to such channel or programming does not
receive it.
``(b) Implementation.--Until a multichannel video programming
distributor complies with the requirement set forth in subsection (a),
the distributor shall limit the access of children to the programming
referred to in that subsection by not providing such programming during
the hours of the day (as determined by the Commission) when a
significant number of children are likely to view it.
``(c) Definition.--As used in this section, the term `scramble'
means to rearrange the content of the signal of the programming so that
the programming cannot be viewed or heard in an understandable
manner.''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect 30 days after the date of enactment of this Act.
SEC. 506. CABLE OPERATOR REFUSAL TO CARRY CERTAIN PROGRAMS.
(a) Public, Educational, and Governmental Channels.--Section 611(e)
(47 U.S.C. 531(e)) is amended by inserting before the period the
following: ``, except a cable operator may refuse to transmit any
public access program or portion of a public access program which
contains obscenity, indecency, or nudity''.
(b) Cable Channels for Commercial Use.--Section 612(c)(2) (47
U.S.C. 532(c)(2)) is amended by striking ``an operator'' and inserting
``a cable operator may refuse to transmit any leased access program or
portion of a leased access program which contains obscenity, indecency,
or nudity and''.
SEC. 507. CLARIFICATION OF CURRENT LAWS REGARDING COMMUNICATION OF
OBSCENE MATERIALS THROUGH THE USE OF COMPUTERS.
(a) Importation or Transportation.--Section 1462 of title 18,
United States Code, is amended--
(1) in the first undesignated paragraph, by inserting ``or
interactive computer service (as defined in section 230(e)(2) of
the Communications Act of 1934)'' after ``carrier''; and
(2) in the second undesignated paragraph--
(A) by inserting ``or receives,'' after ``takes'';
(B) by inserting ``or interactive computer service (as
defined in section 230(e)(2) of the Communications Act of
1934)'' after ``common carrier''; and
(C) by inserting ``or importation'' after ``carriage''.
(b) Transportation for Purposes of Sale or Distribution.--The first
undesignated paragraph of section 1465 of title 18, United States Code,
is amended--
(1) by striking ``transports in'' and inserting ``transports or
travels in, or uses a facility or means of,'';
(2) by inserting ``or an interactive computer service (as
defined in section 230(e)(2) of the Communications Act of 1934) in
or affecting such commerce'' after ``foreign commerce'' the first
place it appears;
(3) by striking ``, or knowingly travels in'' and all that
follows through ``obscene material in interstate or foreign
commerce,'' and inserting ``of''.
(c) Interpretation.--The amendments made by this section are
clarifying and shall not be interpreted to limit or repeal any
prohibition contained in sections 1462 and 1465 of title 18, United
States Code, before such amendment, under the rule established in
United States v. Alpers, 338 U.S. 680 (1950).
SEC. 508. COERCION AND ENTICEMENT OF MINORS.
Section 2422 of title 18, United States Code, is amended--
(1) by inserting ``(a)'' before ``Whoever knowingly''; and
(2) by adding at the end the following:
``(b) Whoever, using any facility or means of interstate or foreign
commerce, including the mail, or within the special maritime and
territorial jurisdiction of the United States, knowingly persuades,
induces, entices, or coerces any individual who has not attained the
age of 18 years to engage in prostitution or any sexual act for which
any person may be criminally prosecuted, or attempts to do so, shall be
fined under this title or imprisoned not more than 10 years, or
both.''.
SEC. 509. ONLINE FAMILY EMPOWERMENT.
Title II of the Communications Act of 1934 (47 U.S.C. 201 et seq.)
is amended by adding at the end the following new section:
``SEC. 230. PROTECTION FOR PRIVATE BLOCKING AND SCREENING OF OFFENSIVE
MATERIAL.
``(a) Findings.--The Congress finds the following:
``(1) The rapidly developing array of Internet and other
interactive computer services available to individual Americans
represent an extraordinary advance in the availability of
educational and informational resources to our citizens.
``(2) These services offer users a great degree of control over
the information that they receive, as well as the potential for
even greater control in the future as technology develops.
``(3) The Internet and other interactive computer services
offer a forum for a true diversity of political discourse, unique
opportunities for cultural development, and myriad avenues for
intellectual activity.
``(4) The Internet and other interactive computer services have
flourished, to the benefit of all Americans, with a minimum of
government regulation.
``(5) Increasingly Americans are relying on interactive media
for a variety of political, educational, cultural, and
entertainment services.
``(b) Policy.--It is the policy of the United States--
``(1) to promote the continued development of the Internet and
other interactive computer services and other interactive media;
``(2) to preserve the vibrant and competitive free market that
presently exists for the Internet and other interactive computer
services, unfettered by Federal or State regulation;
``(3) to encourage the development of technologies which
maximize user control over what information is received by
individuals, families, and schools who use the Internet and other
interactive computer services;
``(4) to remove disincentives for the development and
utilization of blocking and filtering technologies that empower
parents to restrict their children's access to objectionable or
inappropriate online material; and
``(5) to ensure vigorous enforcement of Federal criminal laws
to deter and punish trafficking in obscenity, stalking, and
harassment by means of computer.
``(c) Protection for `Good Samaritan' Blocking and Screening of
Offensive Material.--
``(1) Treatment of publisher or speaker.--No provider or user
of an interactive computer service shall be treated as the
publisher or speaker of any information provided by another
information content provider.
``(2) Civil liability.--No provider or user of an interactive
computer service shall be held liable on account of--
``(A) any action voluntarily taken in good faith to
restrict access to or availability of material that the
provider or user considers to be obscene, lewd, lascivious,
filthy, excessively violent, harassing, or otherwise
objectionable, whether or not such material is constitutionally
protected; or
``(B) any action taken to enable or make available to
information content providers or others the technical means to
restrict access to material described in paragraph (1).
``(d) Effect on Other Laws.--
``(1) No effect on criminal law.--Nothing in this section shall
be construed to impair the enforcement of section 223 of this Act,
chapter 71 (relating to obscenity) or 110 (relating to sexual
exploitation of children) of title 18, United States Code, or any
other Federal criminal statute.
``(2) No effect on intellectual property law.--Nothing in this
section shall be construed to limit or expand any law pertaining to
intellectual property.
``(3) State law.--Nothing in this section shall be construed to
prevent any State from enforcing any State law that is consistent
with this section. No cause of action may be brought and no
liability may be imposed under any State or local law that is
inconsistent with this section.
``(4) No effect on communications privacy law.--Nothing in this
section shall be construed to limit the application of the
Electronic Communications Privacy Act of 1986 or any of the
amendments made by such Act, or any similar State law.
``(e) Definitions.--As used in this section:
``(1) Internet.--The term `Internet' means the international
computer network of both Federal and non-Federal interoperable
packet switched data networks.
``(2) Interactive computer service.--The term `interactive
computer service' means any information service, system, or access
software provider that provides or enables computer access by
multiple users to a computer server, including specifically a
service or system that provides access to the Internet and such
systems operated or services offered by libraries or educational
institutions.
``(3) Information content provider.--The term `information
content provider' means any person or entity that is responsible,
in whole or in part, for the creation or development of information
provided through the Internet or any other interactive computer
service.
``(4) Access software provider.--The term `access software
provider' means a provider of software (including client or server
software), or enabling tools that do any one or more of the
following:
``(A) filter, screen, allow, or disallow content;
``(B) pick, choose, analyze, or digest content; or
``(C) transmit, receive, display, forward, cache, search,
subset, organize, reorganize, or translate content.''.
Subtitle B--Violence
SEC. 551. PARENTAL CHOICE IN TELEVISION PROGRAMMING.
(a) Findings.--The Congress makes the following findings:
(1) Television influences children's perception of the values
and behavior that are common and acceptable in society.
(2) Television station operators, cable television system
operators, and video programmers should follow practices in
connection with video programming that take into consideration that
television broadcast and cable programming has established a
uniquely pervasive presence in the lives of American children.
(3) The average American child is exposed to 25 hours of
television each week and some children are exposed to as much as 11
hours of television a day.
(4) Studies have shown that children exposed to violent video
programming at a young age have a higher tendency for violent and
aggressive behavior later in life than children not so exposed, and
that children exposed to violent video programming are prone to
assume that acts of violence are acceptable behavior.
(5) Children in the United States are, on average, exposed to
an estimated 8,000 murders and 100,000 acts of violence on
television by the time the child completes elementary school.
(6) Studies indicate that children are affected by the
pervasiveness and casual treatment of sexual material on
television, eroding the ability of parents to develop responsible
attitudes and behavior in their children.
(7) Parents express grave concern over violent and sexual video
programming and strongly support technology that would give them
greater control to block video programming in the home that they
consider harmful to their children.
(8) There is a compelling governmental interest in empowering
parents to limit the negative influences of video programming that
is harmful to children.
(9) Providing parents with timely information about the nature
of upcoming video programming and with the technological tools that
allow them easily to block violent, sexual, or other programming
that they believe harmful to their children is a nonintrusive and
narrowly tailored means of achieving that compelling governmental
interest.
(b) Establishment of Television Rating Code.--
(1) Amendment.--Section 303 (47 U.S.C. 303) is amended by
adding at the end the following:
``(w) Prescribe--
``(1) on the basis of recommendations from an advisory
committee established by the Commission in accordance with section
551(b)(2) of the Telecommunications Act of 1996, guidelines and
recommended procedures for the identification and rating of video
programming that contains sexual, violent, or other indecent
material about which parents should be informed before it is
displayed to children: Provided, That nothing in this paragraph
shall be construed to authorize any rating of video programming on
the basis of its political or religious content; and
``(2) with respect to any video programming that has been
rated, and in consultation with the television industry, rules
requiring distributors of such video programming to transmit such
rating to permit parents to block the display of video programming
that they have determined is inappropriate for their children.''.
(2) Advisory committee requirements.--In establishing an
advisory committee for purposes of the amendment made by paragraph
(1) of this subsection, the Commission shall--
(A) ensure that such committee is composed of parents,
television broadcasters, television programming producers,
cable operators, appropriate public interest groups, and other
interested individuals from the private sector and is fairly
balanced in terms of political affiliation, the points of view
represented, and the functions to be performed by the
committee;
(B) provide to the committee such staff and resources as
may be necessary to permit it to perform its functions
efficiently and promptly; and
(C) require the committee to submit a final report of its
recommendations within one year after the date of the
appointment of the initial members.
(c) Requirement for Manufacture of Televisions That Block
Programs.--Section 303 (47 U.S.C. 303), as amended by subsection (a),
is further amended by adding at the end the following:
``(x) Require, in the case of an apparatus designed to receive
television signals that are shipped in interstate commerce or
manufactured in the United States and that have a picture screen 13
inches or greater in size (measured diagonally), that such apparatus be
equipped with a feature designed to enable viewers to block display of
all programs with a common rating, except as otherwise permitted by
regulations pursuant to section 330(c)(4).''.
(d) Shipping of Televisions That Block Programs.--
(1) Regulations.--Section 330 (47 U.S.C. 330) is amended--
(A) by redesignating subsection (c) as subsection (d); and
(B) by adding after subsection (b) the following new
subsection (c):
``(c)(1) Except as provided in paragraph (2), no person shall ship
in interstate commerce or manufacture in the United States any
apparatus described in section 303(x) of this Act except in accordance
with rules prescribed by the Commission pursuant to the authority
granted by that section.
``(2) This subsection shall not apply to carriers transporting
apparatus referred to in paragraph (1) without trading in it.
``(3) The rules prescribed by the Commission under this subsection
shall provide for the oversight by the Commission of the adoption of
standards by industry for blocking technology. Such rules shall require
that all such apparatus be able to receive the rating signals which
have been transmitted by way of line 21 of the vertical blanking
interval and which conform to the signal and blocking specifications
established by industry under the supervision of the Commission.
``(4) As new video technology is developed, the Commission shall
take such action as the Commission determines appropriate to ensure
that blocking service continues to be available to consumers. If the
Commission determines that an alternative blocking technology exists
that--
``(A) enables parents to block programming based on identifying
programs without ratings,
``(B) is available to consumers at a cost which is comparable
to the cost of technology that allows parents to block programming
based on common ratings, and
``(C) will allow parents to block a broad range of programs on
a multichannel system as effectively and as easily as technology
that allows parents to block programming based on common ratings,
the Commission shall amend the rules prescribed pursuant to section
303(x) to require that the apparatus described in such section be
equipped with either the blocking technology described in such section
or the alternative blocking technology described in this paragraph.''.
(2) Conforming amendment.--Section 330(d), as redesignated by
subsection (d)(1)(A), is amended by striking ``section 303(s), and
section 303(u)'' and inserting in lieu thereof ``and sections
303(s), 303(u), and 303(x)''.
(e) Applicability and Effective Dates.--
(1) Applicability of rating provision.--The amendment made by
subsection (b) of this section shall take effect 1 year after the
date of enactment of this Act, but only if the Commission
determines, in consultation with appropriate public interest groups
and interested individuals from the private sector, that
distributors of video programming have not, by such date--
(A) established voluntary rules for rating video
programming that contains sexual, violent, or other indecent
material about which parents should be informed before it is
displayed to children, and such rules are acceptable to the
Commission; and
(B) agreed voluntarily to broadcast signals that contain
ratings of such programming.
(2) Effective date of manufacturing provision.--In prescribing
regulations to implement the amendment made by subsection (c), the
Federal Communications Commission shall, after consultation with
the television manufacturing industry, specify the effective date
for the applicability of the requirement to the apparatus covered
by such amendment, which date shall not be less than two years
after the date of enactment of this Act.
SEC. 552. TECHNOLOGY FUND.
It is the policy of the United States to encourage broadcast
television, cable, satellite, syndication, other video programming
distributors, and relevant related industries (in consultation with
appropriate public interest groups and interested individuals from the
private sector) to--
(1) establish a technology fund to encourage television and
electronics equipment manufacturers to facilitate the development
of technology which would empower parents to block programming they
deem inappropriate for their children and to encourage the
availability thereof to low income parents;
(2) report to the viewing public on the status of the
development of affordable, easy to use blocking technology; and
(3) establish and promote effective procedures, standards,
systems, advisories, or other mechanisms for ensuring that users
have easy and complete access to the information necessary to
effectively utilize blocking technology and to encourage the
availability thereof to low income parents.
Subtitle C--Judicial Review
SEC. 561. EXPEDITED REVIEW.
(a) Three-Judge District Court Hearing.--Notwithstanding any other
provision of law, any civil action challenging the constitutionality,
on its face, of this title or any amendment made by this title, or any
provision thereof, shall be heard by a district court of 3 judges
convened pursuant to the provisions of section 2284 of title 28, United
States Code.
(b) Appellate Review.--Notwithstanding any other provision of law,
an interlocutory or final judgment, decree, or order of the court of 3
judges in an action under subsection (a) holding this title or an
amendment made by this title, or any provision thereof,
unconstitutional shall be reviewable as a matter of right by direct
appeal to the Supreme Court. Any such appeal shall be filed not more
than 20 days after entry of such judgment, decree, or order.
TITLE VI--EFFECT ON OTHER LAWS
SEC. 601. APPLICABILITY OF CONSENT DECREES AND OTHER LAW.
(a) Applicability of Amendments to Future Conduct.--
(1) AT&T consent decree.--Any conduct or activity that was,
before the date of enactment of this Act, subject to any
restriction or obligation imposed by the AT&T Consent Decree shall,
on and after such date, be subject to the restrictions and
obligations imposed by the Communications Act of 1934 as amended by
this Act and shall not be subject to the restrictions and the
obligations imposed by such Consent Decree.
(2) GTE consent decree.--Any conduct or activity that was,
before the date of enactment of this Act, subject to any
restriction or obligation imposed by the GTE Consent Decree shall,
on and after such date, be subject to the restrictions and
obligations imposed by the Communications Act of 1934 as amended by
this Act and shall not be subject to the restrictions and the
obligations imposed by such Consent Decree.
(3) McCaw consent decree.--Any conduct or activity that was,
before the date of enactment of this Act, subject to any
restriction or obligation imposed by the McCaw Consent Decree
shall, on and after such date, be subject to the restrictions and
obligations imposed by the Communications Act of 1934 as amended by
this Act and subsection (d) of this section and shall not be
subject to the restrictions and the obligations imposed by such
Consent Decree.
(b) Antitrust Laws.--
(1) Savings clause.--Except as provided in paragraphs (2) and
(3), nothing in this Act or the amendments made by this Act shall
be construed to modify, impair, or supersede the applicability of
any of the antitrust laws.
(2) Repeal.--Subsection (a) of section 221 (47 U.S.C. 221(a))
is repealed.
(3) Clayton act.--Section 7 of the Clayton Act (15 U.S.C. 18)
is amended in the last paragraph by striking ``Federal
Communications Commission,''.
(c) Federal, State, and Local Law.--
(1) No implied effect.--This Act and the amendments made by
this Act shall not be construed to modify, impair, or supersede
Federal, State, or local law unless expressly so provided in such
Act or amendments.
(2) State tax savings provision.--Notwithstanding paragraph
(1), nothing in this Act or the amendments made by this Act shall
be construed to modify, impair, or supersede, or authorize the
modification, impairment, or supersession of, any State or local
law pertaining to taxation, except as provided in sections 622 and
653(c) of the Communications Act of 1934 and section 602 of this
Act.
(d) Commercial Mobile Service Joint Marketing.--Notwithstanding
section 22.903 of the Commission's regulations (47 C.F.R. 22.903) or
any other Commission regulation, a Bell operating company or any other
company may, except as provided in sections 271(e)(1) and 272 of the
Communications Act of 1934 as amended by this Act as they relate to
wireline service, jointly market and sell commercial mobile services in
conjunction with telephone exchange service, exchange access, intraLATA
telecommunications service, interLATA telecommunications service, and
information services.
(e) Definitions.--As used in this section:
(1) AT&T consent decree.--The term ``AT&T Consent Decree''
means the order entered August 24, 1982, in the antitrust action
styled United States v. Western Electric, Civil Action No. 82-0192,
in the United States District Court for the District of Columbia,
and includes any judgment or order with respect to such action
entered on or after August 24, 1982.
(2) GTE consent decree.--The term ``GTE Consent Decree'' means
the order entered December 21, 1984, as restated January 11, 1985,
in the action styled United States v. GTE Corp., Civil Action No.
83-1298, in the United States District Court for the District of
Columbia, and any judgment or order with respect to such action
entered on or after December 21, 1984.
(3) McCaw consent decree.--The term ``McCaw Consent Decree''
means the proposed consent decree filed on July 15, 1994, in the
antitrust action styled United States v. AT&T Corp. and McCaw
Cellular Communications, Inc., Civil Action No. 94-01555, in the
United States District Court for the District of Columbia. Such
term includes any stipulation that the parties will abide by the
terms of such proposed consent decree until it is entered and any
order entering such proposed consent decree.
(4) Antitrust laws.--The term ``antitrust laws'' has the
meaning given it in subsection (a) of the first section of the
Clayton Act (15 U.S.C. 12(a)), except that such term includes the
Act of June 19, 1936 (49 Stat. 1526; 15 U.S.C. 13 et seq.),
commonly known as the Robinson-Patman Act, and section 5 of the
Federal Trade Commission Act (15 U.S.C. 45) to the extent that such
section 5 applies to unfair methods of competition.
SEC. 602. PREEMPTION OF LOCAL TAXATION WITH RESPECT TO DIRECT-TO-HOME
SERVICES.
(a) Preemption.--A provider of direct-to-home satellite service
shall be exempt from the collection or remittance, or both, of any tax
or fee imposed by any local taxing jurisdiction on direct-to-home
satellite service.
(b) Definitions.--For the purposes of this section--
(1) Direct-to-home satellite service.--The term ``direct-to-
home satellite service'' means only programming transmitted or
broadcast by satellite directly to the subscribers' premises
without the use of ground receiving or distribution equipment,
except at the subscribers' premises or in the uplink process to the
satellite.
(2) Provider of direct-to-home satellite service.--For purposes
of this section, a ``provider of direct-to-home satellite service''
means a person who transmits, broadcasts, sells, or distributes
direct-to-home satellite service.
(3) Local taxing jurisdiction.--The term ``local taxing
jurisdiction'' means any municipality, city, county, township,
parish, transportation district, or assessment jurisdiction, or any
other local jurisdiction in the territorial jurisdiction of the
United States with the authority to impose a tax or fee, but does
not include a State.
(4) State.--The term ``State'' means any of the several States,
the District of Columbia, or any territory or possession of the
United States.
(5) Tax or fee.--The terms ``tax'' and ``fee'' mean any local
sales tax, local use tax, local intangible tax, local income tax,
business license tax, utility tax, privilege tax, gross receipts
tax, excise tax, franchise fees, local telecommunications tax, or
any other tax, license, or fee that is imposed for the privilege of
doing business, regulating, or raising revenue for a local taxing
jurisdiction.
(c) Preservation of State Authority.--This section shall not be
construed to prevent taxation of a provider of direct-to-home satellite
service by a State or to prevent a local taxing jurisdiction from
receiving revenue derived from a tax or fee imposed and collected by a
State.
TITLE VII--MISCELLANEOUS PROVISIONS
SEC. 701. PREVENTION OF UNFAIR BILLING PRACTICES FOR INFORMATION OR
SERVICES PROVIDED OVER TOLL-FREE TELEPHONE CALLS.
(a) Prevention of Unfair Billing Practices.--
(1) In general.--Section 228(c) (47 U.S.C. 228(c)) is amended--
(A) by striking out subparagraph (C) of paragraph (7) and
inserting in lieu thereof the following:
``(C) the calling party being charged for information
conveyed during the call unless--
``(i) the calling party has a written agreement
(including an agreement transmitted through electronic
medium) that meets the requirements of paragraph (8); or
``(ii) the calling party is charged for the information
in accordance with paragraph (9); or'';
(B)(i) by striking ``or'' at the end of subparagraph (C) of
such paragraph;
(ii) by striking the period at the end of subparagraph (D)
of such paragraph and inserting a semicolon and ``or''; and
(iii) by adding at the end thereof the following:
``(E) the calling party being assessed, by virtue of being
asked to connect or otherwise transfer to a pay-per-call
service, a charge for the call.''; and
(C) by adding at the end the following new paragraphs:
``(8) Subscription agreements for billing for information
provided via toll-free calls.--
``(A) In general.--For purposes of paragraph (7)(C)(i), a
written subscription does not meet the requirements of this
paragraph unless the agreement specifies the material terms and
conditions under which the information is offered and
includes--
``(i) the rate at which charges are assessed for the
information;
``(ii) the information provider's name;
``(iii) the information provider's business address;
``(iv) the information provider's regular business
telephone number;
``(v) the information provider's agreement to notify
the subscriber at least one billing cycle in advance of all
future changes in the rates charged for the information;
and
``(vi) the subscriber's choice of payment method, which
may be by direct remit, debit, prepaid account, phone bill,
or credit or calling card.
``(B) Billing arrangements.--If a subscriber elects,
pursuant to subparagraph (A)(vi), to pay by means of a phone
bill--
``(i) the agreement shall clearly explain that the
subscriber will be assessed for calls made to the
information service from the subscriber's phone line;
``(ii) the phone bill shall include, in prominent type,
the following disclaimer:
`Common carriers may not disconnect local or long
distance telephone service for failure to pay disputed
charges for information services.'; and
``(iii) the phone bill shall clearly list the 800
number dialed.
``(C) Use of pins to prevent unauthorized use.--A written
agreement does not meet the requirements of this paragraph
unless it--
``(i) includes a unique personal identification number
or other subscriber-specific identifier and requires a
subscriber to use this number or identifier to obtain
access to the information provided and includes
instructions on its use; and
``(ii) assures that any charges for services accessed
by use of the subscriber's personal identification number
or subscriber-specific identifier be assessed to
subscriber's source of payment elected pursuant to
subparagraph (A)(vi).
``(D) Exceptions.--Notwithstanding paragraph (7)(C), a
written agreement that meets the requirements of this paragraph
is not required--
``(i) for calls utilizing telecommunications devices
for the deaf;
``(ii) for directory services provided by a common
carrier or its affiliate or by a local exchange carrier or
its affiliate; or
``(iii) for any purchase of goods or of services that
are not information services.
``(E) Termination of service.--On receipt by a common
carrier of a complaint by any person that an information
provider is in violation of the provisions of this section, a
carrier shall--
``(i) promptly investigate the complaint; and
``(ii) if the carrier reasonably determines that the
complaint is valid, it may terminate the provision of
service to an information provider unless the provider
supplies evidence of a written agreement that meets the
requirements of this section.
``(F) Treatment of remedies.--The remedies provided in this
paragraph are in addition to any other remedies that are
available under title V of this Act.
``(9) Charges by credit, prepaid, debit, charge, or calling
card in absence of agreement.--For purposes of paragraph
(7)(C)(ii), a calling party is not charged in accordance with this
paragraph unless the calling party is charged by means of a credit,
prepaid, debit, charge, or calling card and the information service
provider includes in response to each call an introductory
disclosure message that--
``(A) clearly states that there is a charge for the call;
``(B) clearly states the service's total cost per minute
and any other fees for the service or for any service to which
the caller may be transferred;
``(C) explains that the charges must be billed on either a
credit, prepaid, debit, charge, or calling card;
``(D) asks the caller for the card number;
``(E) clearly states that charges for the call begin at the
end of the introductory message; and
``(F) clearly states that the caller can hang up at or
before the end of the introductory message without incurring
any charge whatsoever.
``(10) Bypass of introductory disclosure message.--The
requirements of paragraph (9) shall not apply to calls from repeat
callers using a bypass mechanism to avoid listening to the
introductory message: Provided, That information providers shall
disable such a bypass mechanism after the institution of any price
increase and for a period of time determined to be sufficient by
the Federal Trade Commission to give callers adequate and
sufficient notice of a price increase.
``(11) Definition of calling card.--As used in this subsection,
the term `calling card' means an identifying number or code unique
to the individual, that is issued to the individual by a common
carrier and enables the individual to be charged by means of a
phone bill for charges incurred independent of where the call
originates.''.
(2) Regulations.--The Federal Communications Commission shall
revise its regulations to comply with the amendment made by
paragraph (1) not later than 180 days after the date of enactment
of this Act.
(3) Effective date.--The amendments made by paragraph (1) shall
take effect on the date of enactment of this Act.
(b) Clarification of ``Pay-Per-Call Services''.--
(1) Telephone disclosure and dispute resolution act.--Section
204(1) of the Telephone Disclosure and Dispute Resolution Act (15
U.S.C. 5714(1)) is amended to read as follows:
``(1) The term `pay-per-call services' has the meaning provided
in section 228(i) of the Communications Act of 1934, except that
the Commission by rule may, notwithstanding subparagraphs (B) and
(C) of section 228(i)(1) of such Act, extend such definition to
other similar services providing audio information or audio
entertainment if the Commission determines that such services are
susceptible to the unfair and deceptive practices that are
prohibited by the rules prescribed pursuant to section 201(a).''.
(2) Communications act.--Section 228(i)(2) (47 U.S.C.
228(i)(2)) is amended by striking ``or any service the charge for
which is tariffed,''.
SEC. 702. PRIVACY OF CUSTOMER INFORMATION.
Title II is amended by inserting after section 221 (47 U.S.C. 221)
the following new section:
``SEC. 222. PRIVACY OF CUSTOMER INFORMATION.
``(a) In General.--Every telecommunications carrier has a duty to
protect the confidentiality of proprietary information of, and relating
to, other telecommunication carriers, equipment manufacturers, and
customers, including telecommunication carriers reselling
telecommunications services provided by a telecommunications carrier.
``(b) Confidentiality of Carrier Information.--A telecommunications
carrier that receives or obtains proprietary information from another
carrier for purposes of providing any telecommunications service shall
use such information only for such purpose, and shall not use such
information for its own marketing efforts.
``(c) Confidentiality of Customer Proprietary Network
Information.--
``(1) Privacy requirements for telecommunications carriers.--
Except as required by law or with the approval of the customer, a
telecommunications carrier that receives or obtains customer
proprietary network information by virtue of its provision of a
telecommunications service shall only use, disclose, or permit
access to individually identifiable customer proprietary network
information in its provision of (A) the telecommunications service
from which such information is derived, or (B) services necessary
to, or used in, the provision of such telecommunications service,
including the publishing of directories.
``(2) Disclosure on request by customers.--A telecommunications
carrier shall disclose customer proprietary network information,
upon affirmative written request by the customer, to any person
designated by the customer.
``(3) Aggregate customer information.--A telecommunications
carrier that receives or obtains customer proprietary network
information by virtue of its provision of a telecommunications
service may use, disclose, or permit access to aggregate customer
information other than for the purposes described in paragraph (1).
A local exchange carrier may use, disclose, or permit access to
aggregate customer information other than for purposes described in
paragraph (1) only if it provides such aggregate information to
other carriers or persons on reasonable and nondiscriminatory terms
and conditions upon reasonable request therefor.
``(d) Exceptions.--Nothing in this section prohibits a
telecommunications carrier from using, disclosing, or permitting access
to customer proprietary network information obtained from its
customers, either directly or indirectly through its agents--
``(1) to initiate, render, bill, and collect for
telecommunications services;
``(2) to protect the rights or property of the carrier, or to
protect users of those services and other carriers from fraudulent,
abusive, or unlawful use of, or subscription to, such services; or
``(3) to provide any inbound telemarketing, referral, or
administrative services to the customer for the duration of the
call, if such call was initiated by the customer and the customer
approves of the use of such information to provide such service.
``(e) Subscriber List Information.--Notwithstanding subsections
(b), (c), and (d), a telecommunications carrier that provides telephone
exchange service shall provide subscriber list information gathered in
its capacity as a provider of such service on a timely and unbundled
basis, under nondiscriminatory and reasonable rates, terms, and
conditions, to any person upon request for the purpose of publishing
directories in any format.
``(f) Definitions.--As used in this section:
``(1) Customer proprietary network information.--The term
`customer proprietary network information' means--
``(A) information that relates to the quantity, technical
configuration, type, destination, and amount of use of a
telecommunications service subscribed to by any customer of a
telecommunications carrier, and that is made available to the
carrier by the customer solely by virtue of the carrier-
customer relationship; and
``(B) information contained in the bills pertaining to
telephone exchange service or telephone toll service received
by a customer of a carrier;
except that such term does not include subscriber list information.
``(2) Aggregate information.--The term `aggregate customer
information' means collective data that relates to a group or
category of services or customers, from which individual customer
identities and characteristics have been removed.
``(3) Subscriber list information.--The term `subscriber list
information' means any information--
``(A) identifying the listed names of subscribers of a
carrier and such subscribers' telephone numbers, addresses, or
primary advertising classifications (as such classifications
are assigned at the time of the establishment of such service),
or any combination of such listed names, numbers, addresses, or
classifications; and
``(B) that the carrier or an affiliate has published,
caused to be published, or accepted for publication in any
directory format.''.
SEC. 703. POLE ATTACHMENTS.
Section 224 (47 U.S.C. 224) is amended--
(1) in subsection (a)(1), by striking the first sentence and
inserting the following: ``The term `utility' means any person who
is a local exchange carrier or an electric, gas, water, steam, or
other public utility, and who owns or controls poles, ducts,
conduits, or rights-of-way used, in whole or in part, for any wire
communications.'';
(2) in subsection (a)(4), by inserting after ``system'' the
following: ``or provider of telecommunications service'';
(3) by inserting after subsection (a)(4) the following:
``(5) For purposes of this section, the term
`telecommunications carrier' (as defined in section 3 of this Act)
does not include any incumbent local exchange carrier as defined in
section 251(h).'';
(4) by inserting after ``conditions'' in subsection (c)(1) a
comma and the following: ``or access to poles, ducts, conduits, and
rights-of-way as provided in subsection (f),'';
(5) in subsection (c)(2)(B), by striking ``cable television
services'' and inserting ``the services offered via such
attachments'';
(6) by inserting after subsection (d)(2) the following:
``(3) This subsection shall apply to the rate for any pole
attachment used by a cable television system solely to provide cable
service. Until the effective date of the regulations required under
subsection (e), this subsection shall also apply to the rate for any
pole attachment used by a cable system or any telecommunications
carrier (to the extent such carrier is not a party to a pole attachment
agreement) to provide any telecommunications service.''; and
(7) by adding at the end thereof the following:
``(e)(1) The Commission shall, no later than 2 years after the date
of enactment of the Telecommunications Act of 1996, prescribe
regulations in accordance with this subsection to govern the charges
for pole attachments used by telecommunications carriers to provide
telecommunications services, when the parties fail to resolve a dispute
over such charges. Such regulations shall ensure that a utility charges
just, reasonable, and nondiscriminatory rates for pole attachments.
``(2) A utility shall apportion the cost of providing space on a
pole, duct, conduit, or right-of-way other than the usable space among
entities so that such apportionment equals two-thirds of the costs of
providing space other than the usable space that would be allocated to
such entity under an equal apportionment of such costs among all
attaching entities.
``(3) A utility shall apportion the cost of providing usable space
among all entities according to the percentage of usable space required
for each entity.
``(4) The regulations required under paragraph (1) shall become
effective 5 years after the date of enactment of the Telecommunications
Act of 1996. Any increase in the rates for pole attachments that result
from the adoption of the regulations required by this subsection shall
be phased in equal annual increments over a period of 5 years beginning
on the effective date of such regulations.
``(f)(1) A utility shall provide a cable television system or any
telecommunications carrier with nondiscriminatory access to any pole,
duct, conduit, or right-of-way owned or controlled by it.
``(2) Notwithstanding paragraph (1), a utility providing electric
service may deny a cable television system or any telecommunications
carrier access to its poles, ducts, conduits, or rights-of-way, on a
non-discriminatory basis where there is insufficient capacity and for
reasons of safety, reliability and generally applicable engineering
purposes.
``(g) A utility that engages in the provision of telecommunications
services or cable services shall impute to its costs of providing such
services (and charge any affiliate, subsidiary, or associate company
engaged in the provision of such services) an equal amount to the pole
attachment rate for which such company would be liable under this
section.
``(h) Whenever the owner of a pole, duct, conduit, or right-of-way
intends to modify or alter such pole, duct, conduit, or right-of-way,
the owner shall provide written notification of such action to any
entity that has obtained an attachment to such conduit or right-of-way
so that such entity may have a reasonable opportunity to add to or
modify its existing attachment. Any entity that adds to or modifies its
existing attachment after receiving such notification shall bear a
proportionate share of the costs incurred by the owner in making such
pole, duct, conduit, or right-of-way accessible.
``(i) An entity that obtains an attachment to a pole, conduit, or
right-of-way shall not be required to bear any of the costs of
rearranging or replacing its attachment, if such rearrangement or
replacement is required as a result of an additional attachment or the
modification of an existing attachment sought by any other entity
(including the owner of such pole, duct, conduit, or right-of-way).''.
SEC. 704. FACILITIES SITING; RADIO FREQUENCY EMISSION STANDARDS.
(a) National Wireless Telecommunications Siting Policy.--Section
332(c) (47 U.S.C. 332(c)) is amended by adding at the end the following
new paragraph:
``(7) Preservation of local zoning authority.--
``(A) General authority.--Except as provided in this
paragraph, nothing in this Act shall limit or affect the
authority of a State or local government or instrumentality
thereof over decisions regarding the placement, construction,
and modification of personal wireless service facilities.
``(B) Limitations.--
``(i) The regulation of the placement, construction,
and modification of personal wireless service facilities by
any State or local government or instrumentality thereof--
``(I) shall not unreasonably discriminate among
providers of functionally equivalent services; and
``(II) shall not prohibit or have the effect of
prohibiting the provision of personal wireless
services.
``(ii) A State or local government or instrumentality
thereof shall act on any request for authorization to
place, construct, or modify personal wireless service
facilities within a reasonable period of time after the
request is duly filed with such government or
instrumentality, taking into account the nature and scope
of such request.
``(iii) Any decision by a State or local government or
instrumentality thereof to deny a request to place,
construct, or modify personal wireless service facilities
shall be in writing and supported by substantial evidence
contained in a written record.
``(iv) No State or local government or instrumentality
thereof may regulate the placement, construction, and
modification of personal wireless service facilities on the
basis of the environmental effects of radio frequency
emissions to the extent that such facilities comply with
the Commission's regulations concerning such emissions.
``(v) Any person adversely affected by any final action
or failure to act by a State or local government or any
instrumentality thereof that is inconsistent with this
subparagraph may, within 30 days after such action or
failure to act, commence an action in any court of
competent jurisdiction. The court shall hear and decide
such action on an expedited basis. Any person adversely
affected by an act or failure to act by a State or local
government or any instrumentality thereof that is
inconsistent with clause (iv) may petition the Commission
for relief.
``(C) Definitions.--For purposes of this paragraph--
``(i) the term `personal wireless services' means
commercial mobile services, unlicensed wireless services,
and common carrier wireless exchange access services;
``(ii) the term `personal wireless service facilities'
means facilities for the provision of personal wireless
services; and
``(iii) the term `unlicensed wireless service' means
the offering of telecommunications services using duly
authorized devices which do not require individual
licenses, but does not mean the provision of direct-to-home
satellite services (as defined in section 303(v)).''.
(b) Radio Frequency Emissions.--Within 180 days after the enactment
of this Act, the Commission shall complete action in ET Docket 93-62 to
prescribe and make effective rules regarding the environmental effects
of radio frequency emissions.
(c) Availability of Property.--Within 180 days of the enactment of
this Act, the President or his designee shall prescribe procedures by
which Federal departments and agencies may make available on a fair,
reasonable, and nondiscriminatory basis, property, rights-of-way, and
easements under their control for the placement of new
telecommunications services that are dependent, in whole or in part,
upon the utilization of Federal spectrum rights for the transmission or
reception of such services. These procedures may establish a
presumption that requests for the use of property, rights-of-way, and
easements by duly authorized providers should be granted absent
unavoidable direct conflict with the department or agency's mission, or
the current or planned use of the property, rights-of-way, and
easements in question. Reasonable fees may be charged to providers of
such telecommunications services for use of property, rights-of-way,
and easements. The Commission shall provide technical support to States
to encourage them to make property, rights-of-way, and easements under
their jurisdiction available for such purposes.
SEC. 705. MOBILE SERVICES DIRECT ACCESS TO LONG DISTANCE CARRIERS.
Section 332(c) (47 U.S.C. 332(c)) is amended by adding at the end
the following new paragraph:
``(8) Mobile services access.--A person engaged in the
provision of commercial mobile services, insofar as such person is
so engaged, shall not be required to provide equal access to common
carriers for the provision of telephone toll services. If the
Commission determines that subscribers to such services are denied
access to the provider of telephone toll services of the
subscribers' choice, and that such denial is contrary to the public
interest, convenience, and necessity, then the Commission shall
prescribe regulations to afford subscribers unblocked access to the
provider of telephone toll services of the subscribers' choice
through the use of a carrier identification code assigned to such
provider or other mechanism. The requirements for unblocking shall
not apply to mobile satellite services unless the Commission finds
it to be in the public interest to apply such requirements to such
services.''.
SEC. 706. ADVANCED TELECOMMUNICATIONS INCENTIVES.
(a) In General.--The Commission and each State commission with
regulatory jurisdiction over telecommunications services shall
encourage the deployment on a reasonable and timely basis of advanced
telecommunications capability to all Americans (including, in
particular, elementary and secondary schools and classrooms) by
utilizing, in a manner consistent with the public interest,
convenience, and necessity, price cap regulation, regulatory
forbearance, measures that promote competition in the local
telecommunications market, or other regulating methods that remove
barriers to infrastructure investment.
(b) Inquiry.--The Commission shall, within 30 months after the date
of enactment of this Act, and regularly thereafter, initiate a notice
of inquiry concerning the availability of advanced telecommunications
capability to all Americans (including, in particular, elementary and
secondary schools and classrooms) and shall complete the inquiry within
180 days after its initiation. In the inquiry, the Commission shall
determine whether advanced telecommunications capability is being
deployed to all Americans in a reasonable and timely fashion. If the
Commission's determination is negative, it shall take immediate action
to accelerate deployment of such capability by removing barriers to
infrastructure investment and by promoting competition in the
telecommunications market.
(c) Definitions.--For purposes of this subsection:
(1) Advanced telecommunications capability.--The term
``advanced telecommunications capability'' is defined, without
regard to any transmission media or technology, as high-speed,
switched, broadband telecommunications capability that enables
users to originate and receive high-quality voice, data, graphics,
and video telecommunications using any technology.
(2) Elementary and secondary schools.--The term ``elementary
and secondary schools'' means elementary and secondary schools, as
defined in paragraphs (14) and (25), respectively, of section 14101
of the Elementary and Secondary Education Act of 1965 (20 U.S.C.
8801).
SEC. 707. TELECOMMUNICATIONS DEVELOPMENT FUND.
(a) Deposit and Use of Auction Escrow Accounts.--Section 309(j)(8)
(47 U.S.C. 309(j)(8)) is amended by adding at the end the following new
subparagraph:
``(C) Deposit and use of auction escrow accounts.--Any
deposits the Commission may require for the qualification of
any person to bid in a system of competitive bidding pursuant
to this subsection shall be deposited in an interest bearing
account at a financial institution designated for purposes of
this subsection by the Commission (after consultation with the
Secretary of the Treasury). Within 45 days following the
conclusion of the competitive bidding--
``(i) the deposits of successful bidders shall be paid
to the Treasury;
``(ii) the deposits of unsuccessful bidders shall be
returned to such bidders; and
``(iii) the interest accrued to the account shall be
transferred to the Telecommunications Development Fund
established pursuant to section 714 of this Act.''.
(b) Establishment and Operation of Fund.--Title VII is amended by
inserting after section 713 (as added by section 305) the following new
section:
``SEC. 714. TELECOMMUNICATIONS DEVELOPMENT FUND.
``(a) Purpose of Section.--It is the purpose of this section--
``(1) to promote access to capital for small businesses in
order to enhance competition in the telecommunications industry;
``(2) to stimulate new technology development, and promote
employment and training; and
``(3) to support universal service and promote delivery of
telecommunications services to underserved rural and urban areas.
``(b) Establishment of Fund.--There is hereby established a body
corporate to be known as the Telecommunications Development Fund, which
shall have succession until dissolved. The Fund shall maintain its
principal office in the District of Columbia and shall be deemed, for
purposes of venue and jurisdiction in civil actions, to be a resident
and citizen thereof.
``(c) Board of Directors.--
``(1) Composition of board; chairman.--The Fund shall have a
Board of Directors which shall consist of 7 persons appointed by
the Chairman of the Commission. Four of such directors shall be
representative of the private sector and three of such directors
shall be representative of the Commission, the Small Business
Administration, and the Department of the Treasury, respectively.
The Chairman of the Commission shall appoint one of the
representatives of the private sector to serve as chairman of the
Fund within 30 days after the date of enactment of this section, in
order to facilitate rapid creation and implementation of the Fund.
The directors shall include members with experience in a number of
the following areas: finance, investment banking, government
banking, communications law and administrative practice, and public
policy.
``(2) Terms of appointed and elected members.--The directors
shall be eligible to serve for terms of 5 years, except of the
initial members, as designated at the time of their appointment--
``(A) 1 shall be eligible to service for a term of 1 year;
``(B) 1 shall be eligible to service for a term of 2 years;
``(C) 1 shall be eligible to service for a term of 3 years;
``(D) 2 shall be eligible to service for a term of 4 years;
and
``(E) 2 shall be eligible to service for a term of 5 years
(1 of whom shall be the Chairman).
Directors may continue to serve until their successors have been
appointed and have qualified.
``(3) Meetings and functions of the board.--The Board of
Directors shall meet at the call of its Chairman, but at least
quarterly. The Board shall determine the general policies which
shall govern the operations of the Fund. The Chairman of the Board
shall, with the approval of the Board, select, appoint, and
compensate qualified persons to fill the offices as may be provided
for in the bylaws, with such functions, powers, and duties as may
be prescribed by the bylaws or by the Board of Directors, and such
persons shall be the officers of the Fund and shall discharge all
such functions, powers, and duties.
``(d) Accounts of the Fund.--The Fund shall maintain its accounts
at a financial institution designated for purposes of this section by
the Chairman of the Board (after consultation with the Commission and
the Secretary of the Treasury). The accounts of the Fund shall consist
of--
``(1) interest transferred pursuant to section 309(j)(8)(C) of
this Act;
``(2) such sums as may be appropriated to the Commission for
advances to the Fund;
``(3) any contributions or donations to the Fund that are
accepted by the Fund; and
``(4) any repayment of, or other payment made with respect to,
loans, equity, or other extensions of credit made from the Fund.
``(e) Use of the Fund.--All moneys deposited into the accounts of
the Fund shall be used solely for--
``(1) the making of loans, investments, or other extensions of
credits to eligible small businesses in accordance with subsection
(f);
``(2) the provision of financial advice to eligible small
businesses;
``(3) expenses for the administration and management of the
Fund (including salaries, expenses, and the rental or purchase of
office space for the fund);
``(4) preparation of research, studies, or financial analyses;
and
``(5) other services consistent with the purposes of this
section.
``(f) Lending and Credit Operations.--Loans or other extensions of
credit from the Fund shall be made available in accordance with the
requirements of the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et
seq.) and any other applicable law to an eligible small business on the
basis of--
``(1) the analysis of the business plan of the eligible small
business;
``(2) the reasonable availability of collateral to secure the
loan or credit extension;
``(3) the extent to which the loan or credit extension promotes
the purposes of this section; and
``(4) other lending policies as defined by the Board.
``(g) Return of Advances.--Any advances appropriated pursuant to
subsection (d)(2) shall be disbursed upon such terms and conditions
(including conditions relating to the time or times of repayment) as
are specified in any appropriations Act providing such advances.
``(h) General Corporate Powers.--The Fund shall have power--
``(1) to sue and be sued, complain and defend, in its corporate
name and through its own counsel;
``(2) to adopt, alter, and use the corporate seal, which shall
be judicially noticed;
``(3) to adopt, amend, and repeal by its Board of Directors,
bylaws, rules, and regulations as may be necessary for the conduct
of its business;
``(4) to conduct its business, carry on its operations, and
have officers and exercise the power granted by this section in any
State without regard to any qualification or similar statute in any
State;
``(5) to lease, purchase, or otherwise acquire, own, hold,
improve, use, or otherwise deal in and with any property, real,
personal, or mixed, or any interest therein, wherever situated, for
the purposes of the Fund;
``(6) to accept gifts or donations of services, or of property,
real, personal, or mixed, tangible or intangible, in aid of any of
the purposes of the Fund;
``(7) to sell, convey, mortgage, pledge, lease, exchange, and
otherwise dispose of its property and assets;
``(8) to appoint such officers, attorneys, employees, and
agents as may be required, to determine their qualifications, to
define their duties, to fix their salaries, require bonds for them,
and fix the penalty thereof; and
``(9) to enter into contracts, to execute instruments, to incur
liabilities, to make loans and equity investment, and to do all
things as are necessary or incidental to the proper management of
its affairs and the proper conduct of its business.
``(i) Accounting, Auditing, and Reporting.--The accounts of the
Fund shall be audited annually. Such audits shall be conducted in
accordance with generally accepted auditing standards by independent
certified public accountants. A report of each such audit shall be
furnished to the Secretary of the Treasury and the Commission. The
representatives of the Secretary and the Commission shall have access
to all books, accounts, financial records, reports, files, and all
other papers, things, or property belonging to or in use by the Fund
and necessary to facilitate the audit.
``(j) Report on Audits by Treasury.--A report of each such audit
for a fiscal year shall be made by the Secretary of the Treasury to the
President and to the Congress not later than 6 months following the
close of such fiscal year. The report shall set forth the scope of the
audit and shall include a statement of assets and liabilities, capital
and surplus or deficit; a statement of surplus or deficit analysis; a
statement of income and expense; a statement of sources and application
of funds; and such comments and information as may be deemed necessary
to keep the President and the Congress informed of the operations and
financial condition of the Fund, together with such recommendations
with respect thereto as the Secretary may deem advisable.
``(k) Definitions.--As used in this section:
``(1) Eligible small business.--The term `eligible small
business' means business enterprises engaged in the
telecommunications industry that have $50,000,000 or less in annual
revenues, on average over the past 3 years prior to submitting the
application under this section.
``(2) Fund.--The term `Fund' means the Telecommunications
Development Fund established pursuant to this section.
``(3) Telecommunications industry.--The term
`telecommunications industry' means communications businesses using
regulated or unregulated facilities or services and includes
broadcasting, telecommunications, cable, computer, data
transmission, software, programming, advanced messaging, and
electronics businesses.''.
SEC. 708. NATIONAL EDUCATION TECHNOLOGY FUNDING CORPORATION.
(a) Findings; Purpose.--
(1) Findings.--The Congress finds as follows:
(A) Corporation.--There has been established in the
District of Columbia a private, nonprofit corporation known as
the National Education Technology Funding Corporation which is
not an agency or independent establishment of the Federal
Government.
(B) Board of directors.--The Corporation is governed by a
Board of Directors, as prescribed in the Corporation's articles
of incorporation, consisting of 15 members, of which--
(i) five members are representative of public agencies
representative of schools and public libraries;
(ii) five members are representative of State
government, including persons knowledgeable about State
finance, technology and education; and
(iii) five members are representative of the private
sector, with expertise in network technology, finance and
management.
(C) Corporate purposes.--The purposes of the Corporation,
as set forth in its articles of incorporation, are--
(i) to leverage resources and stimulate private
investment in education technology infrastructure;
(ii) to designate State education technology agencies
to receive loans, grants or other forms of assistance from
the Corporation;
(iii) to establish criteria for encouraging States to--
(I) create, maintain, utilize and upgrade
interactive high capacity networks capable of providing
audio, visual and data communications for elementary
schools, secondary schools and public libraries;
(II) distribute resources to assure equitable aid
to all elementary schools and secondary schools in the
State and achieve universal access to network
technology; and
(III) upgrade the delivery and development of
learning through innovative technology-based
instructional tools and applications;
(iv) to provide loans, grants and other forms of
assistance to State education technology agencies, with due
regard for providing a fair balance among types of school
districts and public libraries assisted and the disparate
needs of such districts and libraries;
(v) to leverage resources to provide maximum aid to
elementary schools, secondary schools and public libraries;
and
(vi) to encourage the development of education
telecommunications and information technologies through
public-private ventures, by serving as a clearinghouse for
information on new education technologies, and by providing
technical assistance, including assistance to States, if
needed, to establish State education technology agencies.
(2) Purpose.--The purpose of this section is to recognize the
Corporation as a nonprofit corporation operating under the laws of
the District of Columbia, and to provide authority for Federal
departments and agencies to provide assistance to the Corporation.
(b) Definitions.--For the purpose of this section--
(1) the term ``Corporation'' means the National Education
Technology Funding Corporation described in subsection (a)(1)(A);
(2) the terms ``elementary school'' and ``secondary school''
have the same meanings given such terms in section 14101 of the
Elementary and Secondary Education Act of 1965; and
(3) the term ``public library'' has the same meaning given such
term in section 3 of the Library Services and Construction Act.
(c) Assistance for Education Technology Purposes.--
(1) Receipt by corporation.--Notwithstanding any other
provision of law, in order to carry out the corporate purposes
described in subsection (a)(1)(C), the Corporation shall be
eligible to receive discretionary grants, contracts, gifts,
contributions, or technical assistance from any Federal department
or agency, to the extent otherwise permitted by law.
(2) Agreement.--In order to receive any assistance described in
paragraph (1) the Corporation shall enter into an agreement with
the Federal department or agency providing such assistance, under
which the Corporation agrees--
(A) to use such assistance to provide funding and technical
assistance only for activities which the Board of Directors of
the Corporation determines are consistent with the corporate
purposes described in subsection (a)(1)(C);
(B) to review the activities of State education technology
agencies and other entities receiving assistance from the
Corporation to assure that the corporate purposes described in
subsection (a)(1)(C) are carried out;
(C) that no part of the assets of the Corporation shall
accrue to the benefit of any member of the Board of Directors
of the Corporation, any officer or employee of the Corporation,
or any other individual, except as salary or reasonable
compensation for services;
(D) that the Board of Directors of the Corporation will
adopt policies and procedures to prevent conflicts of interest;
(E) to maintain a Board of Directors of the Corporation
consistent with subsection (a)(1)(B);
(F) that the Corporation, and any entity receiving the
assistance from the Corporation, are subject to the appropriate
oversight procedures of the Congress; and
(G) to comply with--
(i) the audit requirements described in subsection (d);
and
(ii) the reporting and testimony requirements described
in subsection (e).
(3) Construction.--Nothing in this section shall be construed
to establish the Corporation as an agency or independent
establishment of the Federal Government, or to establish the
members of the Board of Directors of the Corporation, or the
officers and employees of the Corporation, as officers or employees
of the Federal Government.
(d) Audits.--
(1) Audits by independent certified public accountants.--
(A) In general.--The Corporation's financial statements
shall be audited annually in accordance with generally accepted
auditing standards by independent certified public accountants
who are certified by a regulatory authority of a State or other
political subdivision of the United States. The audits shall be
conducted at the place or places where the accounts of the
Corporation are normally kept. All books, accounts, financial
records, reports, files, and all other papers, things, or
property belonging to or in use by the Corporation and
necessary to facilitate the audit shall be made available to
the person or persons conducting the audits, and full
facilities for verifying transactions with the balances or
securities held by depositories, fiscal agents, and custodians
shall be afforded to such person or persons.
(B) Reporting requirements.--The report of each annual
audit described in subparagraph (A) shall be included in the
annual report required by subsection (e)(1).
(2) Recordkeeping requirements; audit and examination of
books.--
(A) Recordkeeping requirements.--The Corporation shall
ensure that each recipient of assistance from the Corporation
keeps--
(i) separate accounts with respect to such assistance;
(ii) such records as may be reasonably necessary to
fully disclose--
(I) the amount and the disposition by such
recipient of the proceeds of such assistance;
(II) the total cost of the project or undertaking
in connection with which such assistance is given or
used; and
(III) the amount and nature of that portion of the
cost of the project or undertaking supplied by other
sources; and
(iii) such other records as will facilitate an
effective audit.
(B) Audit and examination of books.--The Corporation shall
ensure that the Corporation, or any of the Corporation's duly
authorized representatives, shall have access for the purpose
of audit and examination to any books, documents, papers, and
records of any recipient of assistance from the Corporation
that are pertinent to such assistance. Representatives of the
Comptroller General shall also have such access for such
purpose.
(e) Annual Report; Testimony to the Congress.--
(1) Annual report.--Not later than April 30 of each year, the
Corporation shall publish an annual report for the preceding fiscal
year and submit that report to the President and the Congress. The
report shall include a comprehensive and detailed evaluation of the
Corporation's operations, activities, financial condition, and
accomplishments under this section and may include such
recommendations as the Corporation deems appropriate.
(2) Testimony before congress.--The members of the Board of
Directors, and officers, of the Corporation shall be available to
testify before appropriate committees of the Congress with respect
to the report described in paragraph (1), the report of any audit
made by the Comptroller General pursuant to this section, or any
other matter which any such committee may determine appropriate.
SEC. 709. REPORT ON THE USE OF ADVANCED TELECOMMUNICATIONS SERVICES FOR
MEDICAL PURPOSES.
The Secretary of Commerce, in consultation with the Secretary of
Health and Human Services and other appropriate departments and
agencies, shall submit a report to the Committee on Commerce of the
House of Representatives and the Committee on Commerce, Science, and
Transportation of the Senate concerning the activities of the Joint
Working Group on Telemedicine, together with any findings reached in
the studies and demonstrations on telemedicine funded by the Public
Health Service or other Federal agencies. The report shall examine
questions related to patient safety, the efficacy and quality of the
services provided, and other legal, medical, and economic issues
related to the utilization of advanced telecommunications services for
medical purposes. The report shall be submitted to the respective
committees by January 31, 1997.
SEC. 710. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--In addition to any other sums authorized by law,
there are authorized to be appropriated to the Federal Communications
Commission such sums as may be necessary to carry out this Act and the
amendments made by this Act.
(b) Effect on Fees.--For the purposes of section 9(b)(2) (47 U.S.C.
159(b)(2)), additional amounts appropriated pursuant to subsection (a)
shall be construed to be changes in the amounts appropriated for the
performance of activities described in section 9(a) of the
Communications Act of 1934.
(c) Funding Availability.--Section 309(j)(8)(B) (47 U.S.C.
309(j)(8)(B)) is amended by adding at the end the following new
sentence: ``Such offsetting collections are authorized to remain
available until expended.''.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.