[Congressional Record Volume 145, Number 158 (Wednesday, November 10, 1999)]
[House]
[Pages H11929-H11939]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   COMMUNICATIONS SATELLITE COMPETITION AND PRIVATIZATION ACT OF 1999

  Mr. TAUZIN. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 3261) to amend the Communications Satellite Act of 1962 to 
promote competition and privatization in satellite communications, and 
for other purposes.
  The Clerk read as follows:

                               H.R. 3261

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Communications Satellite 
     Competition and Privatization Act of 1999''.

     SEC. 2. PURPOSE.

       It is the purpose of this Act to promote a fully 
     competitive global market for satellite communication 
     services for the benefit of consumers and providers of 
     satellite services and equipment by fully privatizing the 
     intergovernmental satellite organizations, INTELSAT and 
     Inmarsat.

     SEC. 3. REVISION OF COMMUNICATIONS SATELLITE ACT OF 1962.

       The Communications Satellite Act of 1962 (47 U.S.C. 101) is 
     amended by adding at the end the following new title:

        ``TITLE VI--COMMUNICATIONS COMPETITION AND PRIVATIZATION

      ``Subtitle A--Actions To Ensure Procompetitive Privatization

     ``SEC. 601. FEDERAL COMMUNICATIONS COMMISSION 
                   LICENSING.

       ``(a) Licensing for Separated Entities.--
       ``(1) Competition test.--The Commission may not issue a 
     license or construction permit to any separated entity, or 
     renew or permit the assignment or use of any such license or 
     permit, or authorize the use by any entity subject to United 
     States jurisdiction of any space segment owned, leased, or 
     operated by any separated entity, unless the Commission 
     determines that such issuance, renewal, assignment, or use 
     will not harm competition in the telecommunications market of 
     the United States. If the Commission does not make such a 
     determination, it shall deny or revoke authority to use space 
     segment owned, leased, or operated by the separated entity to 
     provide services to, from, or within the United States.
       ``(2) Criteria for competition test.--In making the 
     determination required by paragraph (1), the Commission shall 
     use the licensing criteria in sections 621 and 623, and shall 
     not make such a determination unless the Commission 
     determines that the privatization of any separated entity is 
     consistent with such criteria.
       ``(b) Licensing for INTELSAT, Inmarsat, and Successor 
     Entities.--
       ``(1) Competition test.--The Commission shall substantially 
     limit, deny, or revoke the authority for any entity subject 
     to United States jurisdiction to use space segment owned, 
     leased, or operated by INTELSAT or Inmarsat or any successor 
     entities to provide non-core services to, from, or within the 
     United States, unless the Commission determines--
       ``(A) after April 1, 2001, in the case of INTELSAT and its 
     successor entities, that INTELSAT and any successor entities 
     have been privatized in a manner that will not harm 
     competition in the telecommunications markets of the United 
     States; or
       ``(B) after April 1, 2000, in the case of Inmarsat and its 
     successor entities, that Inmarsat and any successor entities 
     have been privatized in a manner that will not harm 
     competition in the telecommunications markets of the United 
     States.
       ``(2) Criteria for competition test.--In making the 
     determination required by paragraph (1), the Commission shall 
     use the licensing criteria in sections 621, 622, and 624, and 
     shall not make such a determination unless the Commission 
     determines that such privatization is consistent with such 
     criteria.
       ``(3) Clarification: competitive safeguards.--In making its 
     licensing decisions under this subsection, the Commission 
     shall consider whether users of non-core services provided by 
     INTELSAT or Inmarsat or successor or separated entities are 
     able to obtain non-core services from providers offering 
     services other than through INTELSAT or Inmarsat or successor 
     or separated entities, at competitive rates, terms, or 
     conditions. Such consideration shall also include whether 
     such licensing decisions would require users to replace 
     equipment at substantial costs prior to the termination of 
     its design life. In making its licensing decisions, the 
     Commission shall also consider whether competitive 
     alternatives in individual markets do not exist because they 
     have been foreclosed due to anticompetitive actions 
     undertaken by or resulting from the INTELSAT or Inmarsat 
     systems. Such licensing decisions shall be made in a manner 
     which facilitates achieving the purposes and goals in this 
     title and shall be subject to notice and comment.
       ``(c) Additional Considerations in Determinations.--In 
     making its determinations and licensing decisions under 
     subsections (a) and (b), the Commission shall take into 
     consideration the United States obligations and commitments 
     for satellite services under the Fourth Protocol to the 
     General Agreement on Trade in Services.
       ``(d) Independent Facilities Competition.--Nothing in this 
     section shall be construed as precluding COMSAT from 
     investing in or owning satellites or other facilities 
     independent from INTELSAT and Inmarsat, and successor or 
     separated entities, or from providing services through 
     reselling capacity over the facilities of satellite systems 
     independent from INTELSAT and Inmarsat, and successor or 
     separated entities. This subsection shall not be construed as 
     restricting the types of contracts which can be executed or 
     services which may be provided by COMSAT over the independent 
     satellites or facilities described in this subsection.

[[Page H11930]]

     ``SEC. 602. INTELSAT OR INMARSAT ORBITAL LOCATIONS.

       ``(a) Required Actions.--Unless, in a proceeding under 
     section 601(b), the Commission determines that INTELSAT or 
     Inmarsat have been privatized in a manner that will not harm 
     competition, then--
       ``(1) the President shall oppose, and the Commission shall 
     not assist, any registration for new orbital locations for 
     INTELSAT or Inmarsat--
       ``(A) with respect to INTELSAT, after April 1, 2001; and
       ``(B) with respect to Inmarsat, after April 1, 2000; and
       ``(2) the President and Commission shall, consistent with 
     the deadlines in paragraph (1), take all other necessary 
     measures to preclude procurement, registration, development, 
     or use of new satellites which would provide non-core 
     services.
       ``(b) Exception.--
       ``(1) Replacement and previously contracted satellites.--
     Subsection (a) shall not apply to--
       ``(A) orbital locations for replacement satellites (as 
     described in section 622(2)(B)); and
       ``(B) orbital locations for satellites that are contracted 
     for as of March 25, 1998, if such satellites do not provide 
     additional services.
       ``(2) Limitation on exception.--Paragraph (1) is available 
     only with respect to satellites designed to provide services 
     solely in the C and Ku for INTELSAT, and L for Inmarsat 
     bands.

     ``SEC. 603. ADDITIONAL SERVICES AUTHORIZED.

       ``(a) Services Authorized During Continued Progress.--
       ``(1) Continued authorization.--The Commission may issue an 
     authorization, license, or permit to, or renew the license or 
     permit of, any provider of services using INTELSAT or 
     Inmarsat space segment, or authorize the use of such space 
     segment, for additional services (including additional 
     applications of existing services) or additional areas of 
     business, subject to the requirements of this section.
       ``(2) Additional services permitted under new contracts 
     unless progress fails.--If the Commission makes a finding 
     under subsection (b) that conditions required by such 
     subsection have not been attained, the Commission may not, 
     pursuant to paragraph (1), permit such additional services to 
     be provided directly or indirectly under new contracts for 
     the use of INTELSAT or Inmarsat space segment, unless and 
     until the Commission subsequently makes a finding under such 
     subsection that such conditions have been attained.
       ``(3) Prevention of evasion.--The Commission shall, by 
     rule, prescribe means reasonably designed to prevent evasions 
     of the limitations contained in paragraph (2) by customers 
     who did not use specific additional services as of the date 
     of the Commission's most recent finding under subsection (b) 
     that the conditions of such subsection have not been 
     obtained.
       ``(b) Requirements for Annual Findings.--
       ``(1) General requirements.--The findings required under 
     this subsection shall be made, after notice and comment, on 
     or before January 1 of 2000, 2001, and 2002. The Commission 
     shall find that the conditions required by this subsection 
     have been attained only if the Commission finds that--
       ``(A) substantial and material progress has been made 
     during the preceding period at a rate and manner that is 
     probable to result in achieving pro-competitive 
     privatizations in accordance with the requirements of this 
     title; and
       ``(B) neither INTELSAT nor Inmarsat are hindering 
     competitors' or potential competitors' access to the 
     satellite services marketplace.
       ``(2) First finding.--In making the finding required to be 
     made on or before January 1, 2000, the Commission shall not 
     find that the conditions required by this subsection have 
     been attained unless the Commission finds that--
       ``(A) COMSAT has submitted to the INTELSAT Board of 
     Governors a resolution calling for the pro-competitive 
     privatization of INTELSAT in accordance with the requirements 
     of this title;
       ``(B) the United States has submitted such resolution at 
     the first INTELSAT Assembly of Parties meeting that takes 
     place after such date of enactment; and
       ``(C) the INTELSAT Assembly of Parties has created a 
     working party to consider and make recommendations for the 
     pro-competitive privatization of INTELSAT consistent with 
     such resolution.
       ``(3) Second annual finding.--In making the finding 
     required to be made on or before January 1, 2001, the 
     Commission shall not find that the conditions required by 
     this subsection have been attained unless the INTELSAT 
     Assembly of Parties has approved a recommendation for the 
     pro-competitive privatization of INTELSAT in accordance with 
     the requirements of this title.
       ``(4) Third annual finding.--In making the finding required 
     to be made on or before January 1, 2002, the Commission shall 
     not find that the conditions required by this subsection have 
     been attained unless the pro-competitive privatization of 
     INTELSAT in accordance with the requirements of this title 
     has been achieved by such date.
       ``(5) Criteria for evaluation of hindering access.--The 
     Commission shall not make a determination under paragraph 
     (1)(B) unless the Commission determines that INTELSAT and 
     Inmarsat are not in any way impairing, delaying, or denying 
     access to national markets or orbital locations.
       ``(c) Exception for Services Under Existing Contracts If 
     Progress Not Made.--This section shall not preclude INTELSAT 
     or Inmarsat or any signatory thereof from continuing to 
     provide additional services under an agreement with any third 
     party entered into prior to any finding under subsection (b) 
     that the conditions of such subsection have not been 
     attained.

  ``Subtitle B--Federal Communications Commission Licensing Criteria: 
                         Privatization Criteria

     ``SEC. 621. GENERAL CRITERIA TO ENSURE A PRO-COMPETITIVE 
                   PRIVATIZATION OF INTELSAT AND INMARSAT.

       ``The President and the Commission shall secure a pro-
     competitive privatization of INTELSAT and Inmarsat that meets 
     the criteria set forth in this section and sections 622 
     through 624. In securing such privatizations, the following 
     criteria shall be applied as licensing criteria for purposes 
     of subtitle A:
       ``(1) Dates for privatization.--Privatization shall be 
     obtained in accordance with the criteria of this title of--
       ``(A) INTELSAT as soon as practicable, but no later than 
     April 1, 2001; and
       ``(B) Inmarsat as soon as practicable, but no later than 
     April 1, 2000.
       ``(2) Independence.--The successor entities and separated 
     entities of INTELSAT and Inmarsat resulting from the 
     privatization obtained pursuant to paragraph (1) shall--
       ``(A) be entities that are national corporations; and
       ``(B) have ownership and management that is independent 
     of--
       ``(i) any signatories or former signatories that control 
     access to national telecommunications markets; and
       ``(ii) any intergovernmental organization remaining after 
     the privatization.
       ``(3) Termination of privileges and immunities.--The 
     preferential treatment of INTELSAT and Inmarsat shall not be 
     extended to any successor entity or separated entity of 
     INTELSAT or Inmarsat. Such preferential treatment includes--
       ``(A) privileged or immune treatment by national 
     governments;
       ``(B) privileges or immunities or other competitive 
     advantages of the type accorded INTELSAT and Inmarsat and 
     their signatories through the terms and operation of the 
     INTELSAT Agreement and the associated Headquarters Agreement 
     and the Inmarsat Convention; and
       ``(C) preferential access to orbital locations, including 
     any access to orbital locations that is not subject to the 
     legal or regulatory processes of a national government that 
     applies due diligence requirements intended to prevent the 
     warehousing of orbital locations.
       ``(4) Prevention of expansion during transition.--During 
     the transition period prior to full privatization, INTELSAT 
     and Inmarsat shall be precluded from expanding into 
     additional services (including additional applications of 
     existing services) or additional areas of business.
       ``(5) Conversion to stock corporations.--Any successor 
     entity or separated entity created out of INTELSAT or 
     Inmarsat shall be a national corporation established through 
     the execution of an initial public offering as follows:
       ``(A) Any successor entities and separated entities shall 
     be incorporated as private corporations subject to the laws 
     of the nation in which incorporated.
       ``(B) An initial public offering of securities of any 
     successor entity or separated entity shall be conducted no 
     later than--
       ``(i) April 1, 2001, for the successor entities of 
     INTELSAT; and
       ``(ii) April 1, 2000, for the successor entities of 
     Inmarsat.
       ``(C) The shares of any successor entities and separated 
     entities shall be listed for trading on one or more major 
     stock exchanges with transparent and effective securities 
     regulation.
       ``(D) A majority of the board of directors of any successor 
     entity or separated entity shall not be subject to selection 
     or appointment by, or otherwise serve as representatives of--
       ``(i) any signatory or former signatory that controls 
     access to national telecommunications markets; or
       ``(ii) any intergovernmental organization remaining after 
     the privatization.
       ``(E) Any transactions or other relationships between or 
     among any successor entity, separated entity, INTELSAT, or 
     Inmarsat shall be conducted on an arm's length basis.
       ``(6) Regulatory treatment.--Any successor entity or 
     separated entity shall apply through the appropriate national 
     licensing authorities for international frequency assignments 
     and associated orbital registrations for all satellites.
       ``(7) Competition policies in domiciliary country.--Any 
     successor entity or separated entity shall be incorporated 
     and headquartered in a nation or nations that--
       ``(A) have effective laws and regulations that secure 
     competition in telecommunications services;
       ``(B) are signatories of the World Trade Organization Basic 
     Telecommunications Services Agreement; and
       ``(C) have a schedule of commitments in such Agreement that 
     includes non-discriminatory market access to their satellite 
     markets.

[[Page H11931]]

       ``(8) Return of unused orbital locations.--INTELSAT, 
     Inmarsat, and any successor entities and separated entities 
     shall not be permitted to warehouse any orbital location 
     that--
       ``(A) as of March 25, 1998, did not contain a satellite 
     that was providing commercial services, or, subsequent to 
     such date, ceased to contain a satellite providing commercial 
     services; or
       ``(B) as of March 25, 1998, was not designated in INTELSAT 
     or Inmarsat operational plans for satellites for which 
     construction contracts had been executed.
     Any such orbital location of INTELSAT or Inmarsat and of any 
     successor entities and separated entities shall be returned 
     to the International Telecommunication Union for 
     reallocation.
       ``(9) Appraisal of assets.--Before any transfer of assets 
     by INTELSAT or Inmarsat to any successor entity or separated 
     entity, such assets shall be independently audited for 
     purposes of appraisal, at both book and fair market value.
       ``(10) Limitation on investment.--Notwithstanding the 
     provisions of this title, COMSAT shall not be authorized by 
     the Commission to invest in a satellite known as K-TV, unless 
     Congress authorizes such investment.

     ``SEC. 622. SPECIFIC CRITERIA FOR INTELSAT.

       ``In securing the privatizations required by section 621, 
     the following additional criteria with respect to INTELSAT 
     privatization shall be applied as licensing criteria for 
     purposes of subtitle A:
       ``(1) Number of competitors.--The number of competitors in 
     the markets served by INTELSAT, including the number of 
     competitors created out of INTELSAT, shall be sufficient to 
     create a fully competitive market.
       ``(2) Prevention of expansion during transition.--
       ``(A) In general.--Pending privatization in accordance with 
     the criteria in this title, INTELSAT shall not expand by 
     receiving additional orbital locations, placing new 
     satellites in existing locations, or procuring new or 
     additional satellites except as permitted by subparagraph 
     (B), and the United States shall oppose such expansion--
       ``(i) in INTELSAT, including at the Assembly of Parties;
       ``(ii) in the International Telecommunication Union;
       ``(iii) through United States instructions to COMSAT;
       ``(iv) in the Commission, through declining to facilitate 
     the registration of additional orbital locations or the 
     provision of additional services (including additional 
     applications of existing services) or additional areas of 
     business; and
       ``(v) in other appropriate fora.
       ``(B) Exception for certain replacement satellites.--The 
     limitations in subparagraph (A) shall not apply to any 
     replacement satellites if--
       ``(i) such replacement satellite is used solely to provide 
     public-switched network voice telephony or occasional-use 
     television services, or both;
       ``(ii) such replacement satellite is procured pursuant to a 
     construction contract that was executed on or before March 
     25, 1998; and
       ``(iii) construction of such replacement satellite 
     commences on or before the final date for INTELSAT 
     privatization set forth in section 621(1)(A).
       ``(3) Technical coordination among signatories.--Technical 
     coordination shall not be used to impair competition or 
     competitors, and coordination under Article XIV(d) of the 
     INTELSAT Agreement shall be eliminated.

     ``SEC. 623. SPECIFIC CRITERIA FOR INTELSAT SEPARATED 
                   ENTITIES.

       ``In securing the privatizations required by section 621, 
     the following additional criteria with respect to any 
     INTELSAT separated entity shall be applied as licensing 
     criteria for purposes of subtitle A:
       ``(1) Date for public offering.--Within one year after any 
     decision to create any separated entity, a public offering of 
     the securities of such entity shall be conducted.
       ``(2) Privileges and immunities.--The privileges and 
     immunities of INTELSAT and its signatories shall be waived 
     with respect to any transactions with any separated entity, 
     and any limitations on private causes of action that would 
     otherwise generally be permitted against any separated entity 
     shall be eliminated.
       ``(3) Interlocking directorates or employees.--None of the 
     officers, directors, or employees of any separated entity 
     shall be individuals who are officers, directors, or 
     employees of INTELSAT.
       ``(4) Spectrum assignments.--After the initial transfer 
     which may accompany the creation of a separated entity, the 
     portions of the electromagnetic spectrum assigned as of the 
     date of enactment of this title to INTELSAT shall not be 
     transferred between INTELSAT and any separated entity.
       ``(5) Reaffiliation prohibited.--Any merger or ownership or 
     management ties or exclusive arrangements between a 
     privatized INTELSAT or any successor entity and any separated 
     entity shall be prohibited until 15 years after the 
     completion of INTELSAT privatization under this title.

     ``SEC. 624. SPECIFIC CRITERIA FOR INMARSAT.

       ``In securing the privatizations required by section 621, 
     the following additional criteria with respect to Inmarsat 
     privatization shall be applied as licensing criteria for 
     purposes of subtitle A:
       ``(1) Multiple signatories and direct access.--Multiple 
     signatories and direct access to Inmarsat shall be permitted.
       ``(2) Prevention of expansion during transition.--Pending 
     privatization in accordance with the criteria in this title, 
     Inmarsat should not expand by receiving additional orbital 
     locations, placing new satellites in existing locations, or 
     procuring new or additional satellites, except for specified 
     replacement satellites for which construction contracts have 
     been executed as of March 25, 1998, and the United States 
     shall oppose such expansion--
       ``(A) in Inmarsat, including at the Council and Assembly of 
     Parties;
       ``(B) in the International Telecommunication Union;
       ``(C) through United States instructions to COMSAT;
       ``(D) in the Commission, through declining to facilitate 
     the registration of additional orbital locations or the 
     provision of additional services (including additional 
     applications of existing services) or additional areas of 
     business; and
       ``(E) in other appropriate fora.
     This paragraph shall not be construed as limiting the 
     maintenance, assistance or improvement of the GMDSS.
       ``(3) Number of competitors.--The number of competitors in 
     the markets served by Inmarsat, including the number of 
     competitors created out of Inmarsat, shall be sufficient to 
     create a fully competitive market.
       ``(4) Reaffiliation prohibited.--Any merger or ownership or 
     management ties or exclusive arrangements between Inmarsat or 
     any successor entity or separated entity and ICO shall be 
     prohibited until 15 years after the completion of Inmarsat 
     privatization under this title.
       ``(5) Interlocking directorates or employees.--None of the 
     officers, directors, or employees of Inmarsat or any 
     successor entity or separated entity shall be individuals who 
     are officers, directors, or employees of ICO.
       ``(6) Spectrum assignments.--The portions of the 
     electromagnetic spectrum assigned as of the date of enactment 
     of this title to Inmarsat--
       ``(A) shall, after January 1, 2006, or the date on which 
     the life of the current generation of Inmarsat satellites 
     ends, whichever is later, be made available for assignment to 
     all systems (including the privatized Inmarsat) on a 
     nondiscriminatory basis and in a manner in which continued 
     availability of the GMDSS is provided; and
       ``(B) shall not be transferred between Inmarsat and ICO.
       ``(7) Preservation of the gmdss.--The United States shall 
     seek to preserve space segment capacity of the GMDSS.

     ``SEC. 625. ENCOURAGING MARKET ACCESS AND PRIVATIZATION.

       ``(a) NTIA Determination.--
       ``(1) Determination required.--Within 180 days after the 
     date of enactment of this section, the Secretary of Commerce 
     shall, through the Assistant Secretary for Communications and 
     Information, transmit to the Commission--
       ``(A) a list of Member countries of INTELSAT and Inmarsat 
     that are not Members of the World Trade Organization and that 
     impose barriers to market access for private satellite 
     systems; and
       ``(B) a list of Member countries of INTELSAT and Inmarsat 
     that are not Members of the World Trade Organization and that 
     are not supporting pro-competitive privatization of INTELSAT 
     and Inmarsat.
       ``(2) Consultation.--The Secretary's determinations under 
     paragraph (1) shall be made in consultation with the Federal 
     Communications Commission, the Secretary of State, and the 
     United States Trade Representative, and shall take into 
     account the totality of a country's actions in all relevant 
     fora, including the Assemblies of Parties of INTELSAT and 
     Inmarsat.
       ``(b) Imposition of Cost-Based Settlement Rate.--
     Notwithstanding--
       ``(1) any higher settlement rate that an overseas carrier 
     charges any United States carrier to originate or terminate 
     international message telephone services; and
       ``(2) any transition period that would otherwise apply,
     the Commission may by rule prohibit United States carriers 
     from paying an amount in excess of a cost-based settlement 
     rate to overseas carriers in countries listed by the 
     Commission pursuant to subsection (a).
       ``(c) Settlements Policy.--The Commission shall, in 
     exercising its authority to establish settlements rates for 
     United States international common carriers, seek to advance 
     United States policy in favor of cost-based settlements in 
     all relevant fora on international telecommunications policy, 
     including in meetings with parties and signatories of 
     INTELSAT and Inmarsat.

         ``Subtitle C--Deregulation and Other Statutory Changes

     ``SEC. 641. ACCESS TO INTELSAT.

       ``(a) Access Permitted.--Beginning on the date of enactment 
     of this title, users or providers of telecommunications 
     services shall be permitted to obtain direct access to 
     INTELSAT telecommunications services and space segment 
     capacity through purchases of such capacity or services from, 
     or through investment in, INTELSAT.
       ``(b) Rulemaking.--Within 180 days after the date of 
     enactment of this title, the Commission shall complete a 
     rulemaking, with notice and opportunity for submission of 
     comment by interested persons, to determine

[[Page H11932]]

     if users or providers of telecommunications services have 
     sufficient opportunity to access INTELSAT space segment 
     capacity directly from INTELSAT to meet their service or 
     capacity requirements. If the Commission determines that such 
     opportunity to access does not exist, the Commission shall 
     take appropriate action to facilitate such direct access 
     pursuant to its authority under this Act and the 
     Communications Act of 1934. The Commission shall take such 
     steps as may be necessary to prevent the circumvention of the 
     intent of this section.
       ``(c) Contract Preservation.--Nothing in this section shall 
     be construed to permit the abrogation or modification of any 
     contract.

     ``SEC. 642. SIGNATORY ROLE.

       ``(a) Limitations on Signatories.--
       ``(1) National security limitations.--The Federal 
     Communications Commission, after a public interest 
     determination, in consultation with the executive branch, may 
     restrict foreign ownership of a United States signatory if 
     the Commission determines that not to do so would constitute 
     a threat to national security.
       ``(2) No signatories required.--The United States 
     Government shall not require signatories to represent the 
     United States in INTELSAT or Inmarsat or in any successor 
     entities after a pro-competitive privatization is achieved 
     consistent with sections 621, 622, and 624.
       ``(b) Clarification of Privileges and Immunities of 
     COMSAT.--
       ``(1) Generally not immunized.--Notwithstanding any other 
     law or executive agreement, COMSAT shall not be entitled to 
     any privileges or immunities under the laws of the United 
     States or any State on the basis of its status as a signatory 
     of INTELSAT or Inmarsat.
       ``(2) Limited immunity.--COMSAT and any other company 
     functioning as United States signatory to INTELSAT or 
     Inmarsat shall not be liable for action taken by it in 
     carrying out the specific, written instruction of the United 
     States issued in connection with its relationships and 
     activities with foreign governments, international entities, 
     and the intergovernmental satellite organizations.
       ``(3) Provisions prospective.--Paragraph (1) shall not 
     apply with respect to liability for any action taken by 
     COMSAT before the date of enactment of the Communications 
     Satellite Competition and Privatization Act of 1999.
       ``(c) Parity of Treatment.--Notwithstanding any other law 
     or executive agreement, the Commission shall have the 
     authority to impose similar regulatory fees on the United 
     States signatory which it imposes on other entities providing 
     similar services.

     ``SEC. 643. ELIMINATION OF PROCUREMENT PREFERENCES.

       ``Nothing in this title or the Communications Act of 1934 
     shall be construed to authorize or require any preference, in 
     Federal Government procurement of telecommunications 
     services, for the satellite space segment provided by 
     INTELSAT, Inmarsat, or any successor entity or separated 
     entity.

     ``SEC. 644. USE OF ITU TECHNICAL COORDINATION.

       ``The Commission and United States satellite companies 
     shall utilize the International Telecommunication Union 
     procedures for technical coordination with INTELSAT and its 
     successor entities and separated entities, rather than 
     INTELSAT procedures.

     ``SEC. 645. TERMINATION OF COMMUNICATIONS SATELLITE ACT OF 
                   1962 PROVISIONS.

       ``Effective on the dates specified, the following 
     provisions of this Act shall cease to be effective:
       ``(1) Date of enactment of this title: Sections 101 and 
     102; paragraphs (1), (5) and (6) of section 201(a); section 
     301; section 303; section 502; and paragraphs (2) and (4) of 
     section 504(a).
       ``(2) On the effective date of the Commission's order that 
     establishes direct access to INTELSAT space segment: 
     Paragraphs (1), (3) through (5), and (8) through (10) of 
     section 201(c); and section 304.
       ``(3) On the effective date of the Commission's order that 
     establishes direct access to Inmarsat space segment: 
     Subsections (a) through (d) of section 503.
       ``(4) On the effective date of a Commission order 
     determining under section 601(b)(2) that Inmarsat 
     privatization is consistent with criteria in sections 621 and 
     624: Section 504(b).
       ``(5) On the effective date of a Commission order 
     determining under section 601(b)(2) that INTELSAT 
     privatization is consistent with criteria in sections 621 and 
     622: Paragraphs (2) and (4) of section 201(a); section 
     201(c)(2); subsection (a) of section 403; and section 404.

     ``SEC. 646. REPORTS TO CONGRESS.

       ``(a) Annual Reports.--The President and the Commission 
     shall report to the Committees on Commerce and International 
     Relations of the House of Representatives and the Committees 
     on Commerce, Science, and Transportation and Foreign 
     Relations of the Senate within 90 calendar days of the 
     enactment of this title, and not less than annually 
     thereafter, on the progress made to achieve the objectives 
     and carry out the purposes and provisions of this title. Such 
     reports shall be made available immediately to the public.
       ``(b) Contents of Reports.--The reports submitted pursuant 
     to subsection (a) shall include the following:
       ``(1) Progress with respect to each objective since the 
     most recent preceding report.
       ``(2) Views of the Parties with respect to privatization.
       ``(3) Views of industry and consumers on privatization.
       ``(4) Impact privatization has had on United States 
     industry, United States jobs, and United States industry's 
     access to the global marketplace.

     ``SEC. 647. CONSULTATION WITH CONGRESS.

       ``The President's designees and the Commission shall 
     consult with the Committees on Commerce and International 
     Relations of the House of Representatives and the Committees 
     on Commerce, Science, and Transportation and Foreign 
     Relations of the Senate prior to each meeting of the INTELSAT 
     or Inmarsat Assembly of Parties, the INTELSAT Board of 
     Governors, the Inmarsat Council, or appropriate working group 
     meetings.

     ``SEC. 648. SATELLITE AUCTIONS.

       ``Notwithstanding any other provision of law, the 
     Commission shall not have the authority to assign by 
     competitive bidding orbital locations or spectrum used for 
     the provision of international or global satellite 
     communications services. The President shall oppose in the 
     International Telecommunication Union and in other bilateral 
     and multilateral fora any assignment by competitive bidding 
     of orbital locations or spectrum used for the provision of 
     such services.

     ``SEC. 649. EXCLUSIVITY ARRANGEMENTS.

       ``(a) In General.--No satellite operator shall acquire or 
     enjoy the exclusive right of handling telecommunications to 
     or from the United States, its territories or possessions, 
     and any other country or territory by reason of any 
     concession, contract, understanding, or working arrangement 
     to which the satellite operator or any persons or companies 
     controlling or controlled by the operator are parties.
       ``(b) Exception.--In enforcing the provisions of this 
     section, the Commission--
       ``(1) shall not require the termination of existing 
     satellite telecommunications services under contract with, or 
     tariff commitment to, such satellite operator; but
       ``(2) may require the termination of new services only to 
     the country that has provided the exclusive right to handle 
     telecommunications, if the Commission determines the public 
     interest, convenience, and necessity so requires.

           ``Subtitle D--Negotiations To Pursue Privatization

     ``SEC. 661. METHODS TO PURSUE PRIVATIZATION.

       ``The President shall secure the pro-competitive 
     privatizations required by this title in a manner that meets 
     the criteria in subtitle B.

                       ``Subtitle E--Definitions

     ``SEC. 681. DEFINITIONS.

       ``(a) In General.--As used in this title:
       ``(1) INTELSAT.--The term `INTELSAT' means the 
     International Telecommunications Satellite Organization 
     established pursuant to the Agreement Relating to the 
     International Telecommunications Satellite Organization 
     (INTELSAT).
       ``(2) Inmarsat.--The term `Inmarsat' means the 
     International Mobile Satellite Organization established 
     pursuant to the Convention on the International Maritime 
     Organization.
       ``(3) Signatories.--The term `signatories'--
       ``(A) in the case of INTELSAT, or INTELSAT successors or 
     separated entities, means a Party, or the telecommunications 
     entity designated by a Party, that has signed the Operating 
     Agreement and for which such Agreement has entered into force 
     or to which such Agreement has been provisionally applied; 
     and
       ``(B) in the case of Inmarsat, or Inmarsat successors or 
     separated entities, means either a Party to, or an entity 
     that has been designated by a Party to sign, the Operating 
     Agreement.
       ``(4) Party.--The term `Party'--
       ``(A) in the case of INTELSAT, means a nation for which the 
     INTELSAT agreement has entered into force or been 
     provisionally applied; and
       ``(B) in the case of Inmarsat, means a nation for which the 
     Inmarsat convention has entered into force.
       ``(5) Commission.--The term `Commission' means the Federal 
     Communications Commission.
       ``(6) International telecommunication union.--The term 
     `International Telecommunication Union' means the 
     intergovernmental organization that is a specialized agency 
     of the United Nations in which member countries cooperate for 
     the development of telecommunications, including adoption of 
     international regulations governing terrestrial and space 
     uses of the frequency spectrum as well as use of the 
     geostationary satellite orbit.
       ``(7) Successor entity.--The term `successor entity'--
       ``(A) means any privatized entity created from the 
     privatization of INTELSAT or Inmarsat or from the assets of 
     INTELSAT or Inmarsat; but
       ``(B) does not include any entity that is a separated 
     entity.
       ``(8) Separated entity.--The term `separated entity' means 
     a privatized entity to whom a portion of the assets owned by 
     INTELSAT or Inmarsat are transferred prior to full 
     privatization of INTELSAT or Inmarsat, including in 
     particular the entity whose structure was under discussion by

[[Page H11933]]

     INTELSAT as of March 25, 1998, but excluding ICO.
       ``(9) Orbital location.--The term `orbital location' means 
     the location for placement of a satellite on the 
     geostationary orbital arc as defined in the International 
     Telecommunication Union Radio Regulations.
       ``(10) Space segment.--The term `space segment' means the 
     satellites, and the tracking, telemetry, command, control, 
     monitoring and related facilities and equipment used to 
     support the operation of satellites owned or leased by 
     INTELSAT, Inmarsat, or a separated entity or successor 
     entity.
       ``(11) Non-core services.--The term `non-core services' 
     means, with respect to INTELSAT provision, services other 
     than public-switched network voice telephony and occasional-
     use television, and with respect to Inmarsat provision, 
     services other than global maritime distress and safety 
     services or other existing maritime or aeronautical services 
     for which there are not alternative providers.
       ``(12) Additional services.--The term `additional services' 
     means Internet services, high-speed data, interactive 
     services, non-maritime or non-aeronautical mobile services, 
     Direct to Home (DTH) or Direct Broadcast Satellite (DBS) 
     video services, or Ka-band services.
       ``(13) INTELSAT agreement.--The term `INTELSAT Agreement' 
     means the Agreement Relating to the International 
     Telecommunications Satellite Organization (`INTELSAT'), 
     including all its annexes (TIAS 7532, 23 UST 3813).
       ``(14) Headquarters agreement.--The term `Headquarters 
     Agreement' means the International Telecommunication 
     Satellite Organization Headquarters Agreement (November 24, 
     1976) (TIAS 8542, 28 UST 2248).
       ``(15) Operating agreement.--The term `Operating Agreement' 
     means--
       ``(A) in the case of INTELSAT, the agreement, including its 
     annex but excluding all titles of articles, opened for 
     signature at Washington on August 20, 1971, by Governments or 
     telecommunications entities designated by Governments in 
     accordance with the provisions of the Agreement; and
       ``(B) in the case of Inmarsat, the Operating Agreement on 
     the International Maritime Satellite Organization, including 
     its annexes.
       ``(16) Inmarsat convention.--The term `Inmarsat Convention' 
     means the Convention on the International Maritime Satellite 
     Organization (Inmarsat) (TIAS 9605, 31 UST 1).
       ``(17) National corporation.--The term `national 
     corporation' means a corporation the ownership of which is 
     held through publicly traded securities, and that is 
     incorporated under, and subject to, the laws of a national, 
     state, or territorial government.
       ``(18) COMSAT.--The term `COMSAT' means the corporation 
     established pursuant to title III of the Communications 
     Satellite Act of 1962 (47 U.S.C. 731 et seq.)
       ``(19) ICO.--The term `ICO' means the company known, as of 
     the date of enactment of this title, as ICO Global 
     Communications, Inc.
       ``(20) Replacement satellite.--The term `replacement 
     satellite' means a satellite that replaces a satellite that 
     fails prior to the end of the duration of contracts for 
     services provided over such satellite and that takes the 
     place of a satellite designated for the provision of public-
     switched network and occasional-use television services under 
     contracts executed prior to March 25, 1998 (but not including 
     K-TV or similar satellites). A satellite is only considered a 
     replacement satellite to the extent such contracts are equal 
     to or less than the design life of the satellite.
       ``(21) Global maritime distress and safety services or 
     GMDSS.--The term `global maritime distress and safety 
     services' or `GMDSS' means the automated ship-to-shore 
     distress alerting system which uses satellite and advanced 
     terrestrial systems for international distress communications 
     and promoting maritime safety in general. The GMDSS permits 
     the worldwide alerting of vessels, coordinated search and 
     rescue operations, and dissemination of maritime safety 
     information.
       ``(b) Common Terminology.--Except as otherwise provided in 
     subsection (a), terms used in this title that are defined in 
     section 3 of the Communications Act of 1934 have the meanings 
     provided in such section.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Louisiana (Mr. Tauzin) and the gentleman from Massachusetts (Mr. 
Markey) each will control 20 minutes.
  The Chair recognizes the gentleman from Louisiana (Mr. Tauzin).


                             General Leave

  Mr. TAUZIN. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days in which to revise and extend their remarks on 
this legislation and to insert extraneous material on the bill.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Louisiana?
  There was no objection.
  Mr. TAUZIN. Mr. Speaker, I yield myself 5 minutes.
  Mr. Speaker, I rise in support of H.R. 3261, the Communications 
Satellite Competition and Privatization Act of 1999. In 1962, Congress 
passed the Communications Satellite Act. It was well intended and 
indeed may have fit the times. But the world has changed in the almost 
40 years since then, particularly in telecommunications and space 
technology. It is high time the law caught up with reality.
  As many of my colleagues know, I have been working on this issue with 
the gentleman from Virginia (Mr. Bliley) for a number of years now. The 
gentleman from Virginia has led the effort to author and to pass in the 
last Congress, indeed, this bill through the House and on to the 
Senate. This year, along with the gentleman from Massachusetts, the 
gentleman from Virginia introduced H.R. 1872. That bill was passed by 
403-16. This year, we have gotten together again, made modifications to 
the bill, and I think we have a stronger consensus around the bill than 
we even had last year. I am pleased indeed to join the gentleman from 
Virginia (Mr. Bliley) along with the gentleman from Massachusetts (Mr. 
Markey), the gentleman from Ohio (Mr. Oxley) and a number of others who 
have joined him as cosponsors of the original bill.
  The bill now incorporates in identical form, with minor changes 
regarding dates, all of last year's provisions with respect to 
privatization and reform that were reported out of the committee and 
passed by the House last year. However, the bill is different with 
respect to two issues. It enhances the direct access section and 
eliminates the section known as ``fresh look.'' Thus, we have acted on 
the basis of the hard work of the committee and the House of last year 
but in the process of building consensus, we have changed some 
important provisions.
  The international satellite communications market is dominated now by 
the intergovernmental organization known as INTELSAT as well as by 
Inmarsat, which has done a limited form of privatization. These 
organizations use their market power to expand into services that the 
private sector is frankly chomping at the bit to provide. INTELSAT is 
run by a combination of the world's governments and is owned by a 
consortium of national telecommunications monopolies and dominant 
players, by government monopolies, for government monopolies, of 
government monopolies. Its supporters call it a ``cooperative.'' The 
gentleman from Virginia would call it indeed a ``cartel.''
  Thus, it is critical not only that INTELSAT and Inmarsat be 
privatized but also that real competition be unleashed in this sector. 
A privatized cartel, Mr. Speaker, is still a cartel, the gentleman from 
Virginia will tell you. Today, the owners of these organizations are 
often the same folks that control licensing decisions and foreign 
market access. Thus, they have the ability and the incentive to make it 
hard for U.S. satellite companies to enter and to compete in their 
national telecom markets.
  The only effective way to foster pro-competitive privatization in an 
intergovernmental organization is to indeed use access to the U.S. 
market as part of the leverage. INTELSAT is treaty-based. You cannot 
sue them, tax them or regulate them as you would a private company. So 
this legislation eliminates the diplomatic privileges and unfair 
immunities that would give INTELSAT and COMSAT a leg up on their 
private sector competitors in a private sector marketplace of 
competition. No one in that market should be above the law.
  Finally, the legislation ends the monopoly over access to INTELSAT 
from the U.S. held by COMSAT. The bill permits free competition, known 
as direct access. According to the FCC, COMSAT'S average margin in 
reselling INTELSAT services is still an amazing 68 percent. It is not 
bad if you can get it, but consumers could do, I suspect, a lot better.
  Consumers and taxpayers will benefit from the lower prices that this 
legislation will bring. Businesses and their employees will benefit as 
new markets will open. And the American people will benefit by bringing 
satellite policy into the 21st century.
  Mr. Speaker, I want to thank and commend the gentleman from 
Massachusetts who has been a stalwart with the gentleman from Virginia 
in bringing this issue through the Committee on Commerce and to the 
floor.

[[Page H11934]]

  Mr. Speaker, I reserve the balance of my time.
  Mr. MARKEY. Mr. Speaker, I yield myself such time as I may consume.
  I begin by praising the chairman of the full committee the gentleman 
from Virginia (Mr. Bliley) for his excellent work on this bill and for 
the excellent work of the subcommittee chairman for bringing this new 
version of the legislation out to the floor at this time. As the 
gentleman from Louisiana pointed out, I worked over the last several 
years with the gentleman from Virginia to fashion legislation in this 
area. While we were able to pass it through the House of 
Representatives last year with more than 400 votes, we were 
unsuccessful in reaching final resolution with the Senate. This is an 
effort, working with the gentleman from Louisiana now, with his 
refinements, to move the bill ultimately to the President's desk. I 
think that what we are doing here tonight is going to make it much more 
likely that we are going to see that end result. Working in tandem with 
the gentleman from Michigan (Mr. Dingell) and with all the other 
members of the Committee on Commerce, I think we have got that goal 
line now in our sight.
  Back in 1962 when COMSAT was created, the telecommunications sector 
around the globe was dominated by monopolies. In the United States, we 
only had one company, AT&T. It had 1.2 million employees. As a result, 
the construct of COMSAT and INTELSAT reflected the nature of the 
telecommunications industry at that point in time back in 1962. It is 
not surprising that the act reflected that period in time. It was 
immediately post-Sputnik. There was a paranoia that gripped the free 
world. There was a sense that we were slipping behind. There was a real 
understanding that the only way in which we could catch up is if the 
government, not only the government of our country but the governments 
of all of the free nations of the world banded together to launch these 
satellites that would make it possible for us to catch up and surpass 
the Soviet Union and their allies in the space race. Back then, it took 
national efforts to build, to launch and to maintain satellites in 
orbit.
  But much has changed in the last 35 years, since President Kennedy 
signed the original COMSAT bill into law, since INTELSAT and 
subsequently Inmarsat were made a part of the international 
telecommunications infrastructure. Today, we have private individuals 
with their own money willing to build and to launch satellites into 
space. America leads in these cutting edge technologies, and the 
satellite market alone is a multibillion-dollar market sector and 
employs tens of thousands of workers throughout the country.
  In my opinion in the post-GATT, post-NAFTA world, these are the areas 
that America must win. These are the areas that we should be the 
primary beneficiaries of as a people. These are the areas where our 
citizens, our workers should garner a disproportionate share of the 
jobs since it was the very same workers as taxpayers that footed the 
bill to stand down the Soviet Union by making the investment in these 
satellite technologies, by cobbling together these international 
alliances which made the inevitable defeat of the Soviet Union, 
reflecting the internal contradictions of their system all the more 
obvious as we surrounded them with democratic institutions.
  Today, largely because of the Federal Government, largely because of 
the antitrust actions taken by the Reagan administration's breaking up 
AT&T back in 1982, we now have robust, competitive communications 
markets all across our country. Ironically, it is now a Federal 
district judge appointed by Ronald Reagan who is now calling for the 
dissolution of the monopoly control which Microsoft has over the 
computer marketplace. So this has been a bipartisan effort over the 
years, moving from this original period of monopoly to this new era of 
competition across all lines. It has been done, thank God, on a 
bipartisan basis, liberal and conservative; right wing, left wing; 
Louisiana and Massachusetts, working together.
  Mr. Speaker, that 1962 model is no longer sustainable. In fact, it is 
counterproductive to American interests today. It is time to update the 
INTELSAT and Inmarsat law, two international governmental organizations 
who are not going to compete against U.S. satellite companies on even 
ground, or even space, to put it more accurately, simply because we ask 
them to do so politely. They will not give it up politely. No monopoly 
gives up anything politely. Sometimes it takes an antitrust case 
brought by the Reagan administration against AT&T or a Reagan judge 
against Microsoft. Sometimes it takes legislation. That is what we are 
doing here this evening, the legislative route.
  And, Mr. Speaker, while the U.S. State Department has failed 
repeatedly to secure effective pro-competitive commitments in 
international meetings, all we ever are left with are weak commitments, 
vague promises or worse.
  As part of our previous policy discussions over the years, other U.S. 
companies were repeatedly told that we could not have private sector 
companies in America have direct access to the INTELSAT system. In 
other words, no other American company could bypass the exclusive 
resale role that policymakers bequeathed to COMSAT 37 years ago. We 
were told to ignore the fact that almost half of the world had already 
liberalized such access to INTELSAT in their home countries. Finally, 
earlier this year, the FCC took an initial step in making access to 
INTELSAT more competitive by permitting a minimum level of direct 
access, so-called Level 3 direct access.
  Now we are being told that private sector companies in the United 
States should be prohibited from going to Level 4 direct access. That 
is, allowing other U.S. companies in addition to COMSAT to make private 
investments in INTELSAT. What kind of free market do we have when 
private companies are prevented from risking their own money in 
investments? Are we to ignore the United Kingdom, Argentina and about 
two dozen other countries that have already demonopolized and 
deregulated their market and fully liberalized investment opportunities 
in this fashion? It is time for us to fully embrace the free market in 
international satellite communications, and this bill will help us to 
do just that.

                              {time}  1845

  Level three access only partially achieves the objectives of full and 
fair competition. Level three access would give others the ability to 
obtain INTELSAT capacity at the wholesale level, but would leave COMSAT 
free to subsidize its rate with the 18 percent return it receives on 
its investment in the INTELSAT system as one of the shareholders in the 
consortium and the exclusive U.S. shareholder. Level four access, on 
the other hand, would eliminate the incentive for COMSAT to cross-
subsidize by enabling COMSAT's competitors the opportunity to secure 
the same 18 percent return.
  Now, level four access is already available in the United Kingdom and 
Argentina and Chile and France and New Zealand and Sweden and Denmark, 
in Ireland and Singapore and China, Ecuador, Jordan, Sri Lanka, 
Kazakhstan, and over a dozen other countries now modeling their 
telecommunications systems increasingly on us, and here we have this 
last bastion of monopoly. It is essential that the United States, 
having led the way, now join these other countries.
  Mr. Speaker, our goal for COMSAT, the U.S. signatory, is that it 
evolve into a commercial company like any other American commercial 
company, without any special status or advantages, but also without any 
special obligations. In a new competitive environment, we have high 
hopes that COMSAT will succeed and that its corporate future is bright.
  We believe that the additional changes made by the gentleman from 
Louisiana (Mr. Tauzin) to the legislation moves us very close to a 
final resolution. I think his suggestions were wise and they are now 
incorporated in this legislation.
  I look forward to meeting with the Senate so that we can have 
additional discussions on this historic legislation and so that we can 
move forward along with our local satellite bill, our E-signature 
legislation in making the kinds of historic changes that make it 
possible for the private sector to be innovative, for the private 
sector to create the jobs, to be able to create the wealth which will 
be, ultimately, the

[[Page H11935]]

real peace dividend for Americans and ultimately exporting these 
concepts across the globe.
  I thank the gentleman for all of his great work. I stand, as usual, 
in admiration for his usual leadership.
  Mr. Speaker, I reserve the balance of my time.
  Mr. TAUZIN. Mr. Speaker, I yield myself such time as I may consume 
just briefly, and then I have requests for time that I will honor.
  Let me first thank my friend from Massachusetts for those very 
eloquent and kind words. It occurred to me as he was addressing the 
topic that the United States decision to create these international 
bodies along with countries around the world led, in fact, to the 
launching of communications satellites that are now serving the entire 
globe.
  To a large measure, it was those satellites beaming real information, 
the truth, across a wall in Berlin to citizens who were locked inside 
of a totalitarian system that could survive only by continuing to lie 
to them about how bad things were in the West and how bad democracies 
were and how awful free market systems were. It was those satellites 
that looked across that wall into grocery stores full of food in 
Houston, Texas and Massachusetts and Louisiana and gave a lie to all of 
those old messages that the Soviet Union had unfortunately piled upon 
their own citizens to convince them that their system was somehow 
better. When they turned around and went to grocery stores in Moscow 
and could not buy cabbage, could not buy potatoes, it suddenly dawned 
on them that the lie would not hold anymore, and the wall, indeed, had 
to come down.
  The irony is that the satellite system that our governments helped 
construct, ending up creating freedom, of breaking down walls like the 
Berlin Wall all over the world, and democracies and free markets now 
are beginning to flourish across the globe as the old systems have 
crumbled, the old systems of totalitarianism, communism and, in fact, 
controlled markets that simply did not work.
  So satellites gave and are giving the world freedom. And now, we in 
the House of Representatives are making another historic decision, that 
now it is time to free up the satellite system, to make it free and 
competitive, just like it has helped to free up the competitive juices 
of the economies of the world and to give people freedom across the 
world.
  It is a kind of an ironic twist that now, the good work of these 
satellites and of our government decisions are now leading us to a 
place in time when we can free up satellites now to be just as 
competitive as the forces they themselves helped to unleash across the 
globe. That is indeed an irony. It is also an irony that we meet today 
on this satellite freedom bill right after we passed SHVA, the 
Satellite Home Viewers Act, which was also a bill designed to free up 
competition and the delivery of telephone services here in America.
  Mr. Speaker, I want to say a special word to the gentleman from 
Massachusetts (Mr. Markey) before I yield to the gentleman from Florida 
(Mr. Stearns). We took on this battle together years and years ago, 
long before we joined hands on the floor of the House in 1992 in that 
historic battle to create direct access to programming for the 
satellites that created direct access to television for millions of 
Americans and that may, indeed, be the first real competition to 
monopoly cable across America. Again today we are joining hands in an 
effort, along with the gentleman from Virginia (Mr. Bliley) and others, 
to free up satellite communications to competition across the world.
  It has been an extraordinary pleasure for me, coming from the Bayou 
country of Louisiana, to know and to work with the likes of the 
gentleman from Massachusetts (Mr. Markey) and to share with him his 
intelligence, his wisdom, his wit and his leadership. I thank the 
gentleman so much for that privilege, and it is indeed an honor to join 
the gentleman tonight in another great historic effort.
  Mr. Speaker, I yield such time as he may consume to the gentleman 
from Florida (Mr. Stearns).
  Mr. STEARNS. Mr. Speaker, I want to commend the distinguished 
chairman of the Subcommittee on Telecommunications and the 
distinguished ranking member for bringing this important legislation to 
the House floor today. Obviously, I think all of us agree it is a very 
good first step for more competition and more openness in the global 
satellite telecommunications market. I just want to bring some concern 
to the Members, my colleagues, that I am hoping will be worked out in 
the conference report with the Senate.
  This bill imposes I think a condition on lifting the outdated 
ownership cap of COMSAT. One of the key elements to reforming and 
normalizing the operation of COMSAT is allowing its acquisition by 
Lockheed Martin. The satellite reform bill contains language that 
appears to allow the Lockheed Martin-COMSAT acquisition to be complete, 
but it attaches some conditions of implementing an FCC order on direct 
access to lifting these caps. There is some concern of mine that it is 
not clear whether the September 15, 1999 direct access order must be 
implemented or another future FCC direct access action must be taken. 
Either way, this is somewhat of a concern of mine.
  I think it is some type of restriction on the ability of Lockheed 
Martin and COMSAT to complete their merger, and of course this merger 
has already been approved by the Department of Justice. I think these 
two American companies have waited for over a year for the Federal 
Government to provide the needed regulatory and legislative approval 
for their transaction, but I wanted to express this concern.
  Mr. Speaker, the bill is excellent. This is just a concern I am 
voicing, of course. I want to thank the chairman and the ranking member 
for their efforts on this bill, and I hope that when it moves to the 
Senate, that the restrictions on the Lockheed Martin-COMSAT merger will 
be effective.
  Mr. MARKEY. Mr. Speaker, I yield myself such time as I may consume 
to, in conclusion, thank everyone who has worked on this legislation. 
We have reached a point where it is time to introduce COMSAT fully to 
the private marketplace. We have worked long and hard to reach this 
point, much of the original investment being made by the Federal 
Government. In fact, the Star Wars program itself was a program of 
putting 100 to 200 satellites in the sky and contracting with aerospace 
companies, AT&T, to communicate so that we could shoot down 2,000 or 
3,000 Soviet missiles within 2 to 3 minutes, and it required tremendous 
telecommunications capacity, point to multi-point communications.
  Ultimately, that system will probably never be deployed, but the 
peace dividend that has flown from it is that companies like Hughes 
that were defense contractors moved over and took the same concepts 
over and created Direct TV, the satellite dish company. The same thing 
is true in company after company. The government investment that was 
initially made in order to thwart the ambitions of the Soviet Union 
were ultimately turned into things which benefited the American people 
in its peaceful application. This is another benefit which the American 
people should get and all of the other companies that have been created 
subsequent to the construction of INTELSAT and COMSAT.
  Mr. Speaker, my hope is that the bill passes this evening, goes to a 
conference quickly with the Senate, and that we can resolve the 
differences and produce another great marketplace victory for the 
American people as a post-Cold War dividend.
  Mr. Speaker, I yield back the balance of my time.
  Mr. DINGELL. Mr. Speaker, I rise in support of H.R. 3261.
  First, I want to commend Chairman Bliley for removing a particularly 
controversial provision that was included in the satellite 
privatization bill he authored last year. The so-called ``fresh look'' 
provision would have resulted in privately negotiated contracts being 
abrogated arbitrarily by order of the U.S. Government. The removal of 
this provision is a good first step toward enacting sensible satellite 
privatization legislation this Congress.
  Although I support passage today so we can move the process forward 
to Conference with the Senate, I still have serious concerns with a 
number of provisions contained in the Bliley bill. The privatization 
criteria mandated are so rigorous they cannot possibly be achieved, let 
alone in the limited time frame set forth. The penalties for non-
compliance are so severe that they will, at best, significantly

[[Page H11936]]

disrupt the provision of Intelsat's services to many users in this 
country. At worst, these penalties will cause the ultimate expulsion of 
Intelsat from the U.S. market. Either result would be detrimental to 
the interests of U.S. consumers, and is diametrically opposed to the 
stated purposes of this bill--that is, to create more competition for 
satellite services, not less.
  There is no disagreement between me and Chairman Bliley that Intelsat 
should be privatized as quickly as possible. Unfortunately, the U.S. 
cannot, by legislative fiat, simply impose its will on 143 foreign 
countries who are signatories to the Intelsat treaty. I believe the 
Bliley bill, as currently constructed, would actually undermine 
American diplomatic efforts currently underway to secure an Intelsat 
privatization.
  Mr. Speaker, I am hopeful that through negotiations with the Senate, 
which already has unanimously approved a more reasonable bill to 
achieve privatization of Intelsat, we ultimately will enact a truly 
pro-competitive, pro-consumer solution.
  Mr. ENGEL. Mr. Speaker, I rise today in support of H.R. 3261, the 
Communications Satellite Competition and Privatization Act. This 
legislation is designed to promote the privatization of Intelsat and 
open foreign markets to U.S. companies. Once enacted, this bill will 
bring to American consumers the benefits of lower rates and more 
services. Its passage is long overdue.
  After almost 40 years, it is time to overhaul the 1960s' era U.S. 
international satellite communications policy from one that is 
dominated by intergovernmental organizations such as Intelsat and 
Inmarsat to one that lets private companies compete in an unfettered 
market.
  This bill benefits both U.S. companies and U.S. consumers. I commend 
Chairman Bliley, Mr. Tauzin and Mr. Markey and their staffs for their 
efforts to produce a bipartisan, compromise bill, of which I am a proud 
cosponsor. In particular, the removal of the so-called `Fresh Look' 
provision improves the bill greatly and adds to the reasons it should 
pass in the House of Representatives.
  Mr. Speaker, the bill eliminates the privileges and immunities of 
Intelsat and ends Comsat's monopoly access to Intelsat. Comsat has 
enjoyed for years a monopoly over Intelsat access, which, according to 
the Federal Communications Commission, has permitted Comsat to mark-up 
Intelsat's charges by an average of 68%. It is time to permit the same 
level of comprehensive direct assess to U.S. companies that is 
available to many other countries.
  To better understand the critical direct access provisions in H.R. 
3261, we need to remember that although Comsat is a private 
corporation, it did not arise from normal marketplace forces. Instead, 
it was created by the Congress in the Communications Satellite Act of 
1962 for a specific purpose: to assist in the development of a global 
satellite system. As part of this role and to ensure that no provider 
would dominate the market, Comsat became a ``middleman'', investing in 
the global system and reselling satellite services to entities 
providing tele-communications services to end users.
  While Comsat's ``middleman'' role may have served an important 
purpose when the global satellite system was in its infancy, the 
rationale for this role--that one entity should control access to 
Intelsat--no longer exists. Today, we can no longer justify a 
government-endorsed subsidy to Comsat or any other private successor 
company when fair competition is the only force to control costs and 
protect consumers.
  I urge that members support H.R. 3261. As a member of the Commerce 
Committee and its Subcommittee on Telecommunications which considered 
this legislation, I firmly believe that the bill will increase 
competition, open foreign markets, and create new business 
opportunities for U.S. companies.
  Mr. SHAYS. Mr. Speaker, I rise in support of H.R. 3261, the 
Communications Satellite Competition and Privatization Act. This 
legislation will reform international satellite policies that are 
nearly 40 years old.
  The world of telecommunications has changed dramatically since 1962, 
when it was believed that only governments could finance and manage a 
global satellite system. Back then, Americans had rotary phones they 
leased from the one and only telephone company in the United States. 
Today, a rapidly growing number of Americans carry cellular phones 
wherever they go. They wear pagers and send e-mails across the world. 
And yet, we still have the same structure for international satellite 
communications that was designed before Neil Armstrong walked on the 
moon.
  The result is a distorted marketplace, stifled competition and 
innovation, and increased prices for consumers.
  H.R. 3261 will put an end to the last remaining telecommunications 
monopoly in the United States. The bill promotes competition and opens 
foreign markets for U.S. companies by privatizing the intergovernmental 
satellite organizations--called Intelsat and Inmarsat--that dominate 
international commercial satellite communications. These organizations 
operate as a cartel-like structure comprised of the national telephone 
monopolies and dominant companies of its member organizations.
  Today, private companies such as PanAmSat, GE Americom, Teledesic and 
Motorola have the ability to offer high-quality international satellite 
communications services. But these companies cannot compete with 
Intelsat because of the advantages bestowed upon this organization.
  Mr. Speaker, I want to thank Chairman Tom Bliley of the Commerce 
Committee for his leadership in bringing this important bill to the 
floor. I also would like to thank Congressmen Billy Tauzin and Edward 
Markey for their work in crafting this pro-trade, pro-consumer 
legislation.
  The promotion of a competitive satellite communications marketplace 
is a goal we should all support and I urge my colleagues to support 
this bill.
  Mr. TAUZIN. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Louisiana (Mr. Tauzin) that the House suspend the rules 
and pass the bill, H.R. 3261.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.
  Mr. TAUZIN. Mr. Speaker, I ask unanimous consent that the Committee 
on Commerce be discharged from further consideration of the Senate bill 
(S. 376) to amend the Communications Satellite Act of 1962 to promote 
competition and privatization in satellite communications, and for 
other purposes, and ask for its immediate consideration in the House.
  The Clerk read the title of the Senate bill.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Louisiana?
  There was no objection.
  The Clerk read the Senate bill, as follows:

                                 S. 376

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Open-market Reorganization 
     for the Betterment of International Telecommunications Act''.

     SEC. 2. PURPOSE.

       It is the purpose of this Act to promote a fully 
     competitive domestic and international market for satellite 
     communications services for the benefit of consumers and 
     providers of satellite services by fully encouraging the 
     privatization of the intergovernmental satellite 
     organizations, INTELSAT and Inmarsat, and reforming the 
     regulatory framework of the COMSAT Corporation.

     SEC. 3. FINDINGS.

       The Congress finds that:
       (1) International satellite communications services 
     constitute a critical component of global voice, video and 
     data services, play a vital role in the integration of all 
     nations into the global economy and contribute toward the 
     ability of developing countries to achieve sustainable 
     development.
       (2) The United States played a pivotal role in stimulating 
     the development of international satellite communications 
     services by enactment of the Communications Satellite Act of 
     1962 (47 U.S.C. 701-744), and by its critical contributions, 
     through its signatory, the COMSAT Corporation, in the 
     establishment of INTELSAT, which has successfully established 
     global satellite networks to provide member countries with 
     worldwide access to telecommunications services, including 
     critical lifeline services to the developing world.
       (3) The United States played a pivotal role in stimulating 
     the development of international satellite communications 
     services by enactment of the International Maritime Satellite 
     Telecommunications Act (47 U.S.C. 751-757), and by its 
     critical contributions, through its signatory, COMSAT, in the 
     establishment of Inmarsat, which enabled member countries to 
     provide mobile satellite services such as international 
     maritime and global maritime distress and safety services to 
     include other satellite services, such as land mobile and 
     aeronautical communications services.
        (4) By statute, COMSAT, a publicly traded corporation, is 
     the sole United States signatory to INTELSAT and, as such, is 
     responsible for carrying out United States commitments under 
     the INTELSAT Agreement and the INTELSAT Operating Agreement. 
     Pursuant to a binding Headquarters Agreement, the United 
     States, as a party to INTELSAT, has satisfied many of its 
     obligations under the INTELSAT Agreement.
        (5) In the 37 years since enactment of the Communications 
     Satellite Act of 1962, satellite technology has advanced 
     dramatically,

[[Page H11937]]

     large-scale financing options have improved immensely and 
     international telecommunications policies have shifted from 
     those of natural monopolies to those based on market forces, 
     resulting in multiple private commercial companies around the 
     world providing, or preparing to provide, the domestic, 
     regional, and global satellite telecommunications services 
     that only INTELSAT and Inmarsat had previously had the 
     capabilities to offer.
        (6) Private commercial satellite communications systems 
     now offer the latest telecommunications services to more and 
     more countries of the world with declining costs, making 
     satellite communications an attractive complement as well as 
     an alternative to terrestrial communications systems, 
     particularly in lesser developed countries.
        (7) To enable consumers to realize optimum benefits from 
     international satellite communications services, and to 
     enable these systems to be competitive with other 
     international telecommunication systems, such as fiber optic 
     cable, the global trade and regulatory environment must 
     support vigorous and robust competition.
        (8) In particular, all satellite systems should have 
     unimpeded access to the markets that they are capable of 
     serving, and the ability to compete in a fair and meaningful 
     way within those markets.
        (9) Transforming INTELSAT and Inmarsat from 
     intergovernmental organizations into conventional satellite 
     services companies is a key element in bringing about the 
     emergence of a fully competitive global environment for 
     satellite services.
       (10) The issue of privatization of any State-owned firm is 
     extremely complex and multifaceted. For that reason, the sale 
     of a firm at arm's length does not automatically, and in all 
     cases, extinguish any prior subsidies or government conferred 
     advantages.
        (11) It is in the interest of the United States to 
     negotiate the removal of its reservation in the Fourth 
     Protocol to the General Agreement on Trade in Services 
     regarding INTELSAT's and Inmarsat's access to the United 
     States market through COMSAT as soon as possible, but such 
     reservation cannot be removed without adequate assurance that 
     the United States market for satellite services will not be 
     disrupted by such INTELSAT or Inmarsat access.
        (12) The Communications Satellite Act of 1962, and other 
     applicable United States laws, need to be updated to 
     encourage and complete the pro-competitive privatization of 
     INTELSAT and Inmarsat, to update the domestic United States 
     regulatory regime governing COMSAT, and to ensure a 
     competitively neutral United States framework for the 
     provision of domestic and international telecommunications 
     services via satellite systems.

     SEC. 4. ESTABLISHMENT OF SATELLITE SERVICES COMPETITION; 
                   PRIVATIZATION.

       The Communications Satellite Act of 1962 (47 U.S.C. 701) is 
     amended by adding at the end the following:

      ``TITLE VI--SATELLITE SERVICES COMPETITION AND PRIVATIZATION

           ``Subtitle A--Transition to a Privatized INTELSAT

     ``SEC. 601. POLICY OF THE UNITED STATES.

       ``It is the policy of the United States to--
       ``(1) encourage INTELSAT to privatize in a pro-competitive 
     manner as soon as possible, but not later than January 1, 
     2002, recognizing the need for a reasonable transition and 
     process to achieve a full, pro-competitive restructuring; and
       ``(2) work constructively with its international partners 
     in INTELSAT, and with INTELSAT itself, to bring about a 
     prompt restructuring that will ensure fair competition, both 
     in the United States as well as in the global markets served 
     by the INTELSAT system; and
       ``(3) encourage Inmarsat's full implementation of the terms 
     and conditions of its privatization agreement.

     ``SEC. 602. ROLE OF COMSAT.

       ``(a) Advocacy.--As the United States signatory to 
     INTELSAT, COMSAT shall act as an aggressive advocate of pro-
     competitive privatization of INTELSAT. With respect to the 
     consideration within INTELSAT of any matter related to its 
     privatization, COMSAT shall fully consult with the United 
     States Government prior to exercising its voting rights and 
     shall exercise its voting rights in a manner fully consistent 
     with any instructions issued. In the event that the United 
     States signatory to INTELSAT is acquired after enactment of 
     this section, the President and the Commission shall assure 
     that the instructional process safeguards against conflicts 
     of interest.
       ``(b) Annual Reports.--The President and the Commission 
     shall report annually to the Committee on Commerce of the 
     House of Representatives and the Committee on Commerce, 
     Science, and Transportation of the Senate, respectively, on 
     the progress being made by INTELSAT and Inmarsat to privatize 
     and complete privatization in a pro-competitive manner.

     ``SEC. 603. RESTRICTIONS PENDING PRIVATIZATION.

       ``(a) INTELSAT shall be prohibited from entering the United 
     States market directly to provide any satellite 
     communications services or space segment capacity to carriers 
     (other than the United States signatory) or end users in the 
     United States until July 1, 2001 or until INTELSAT achieves a 
     pro-competitive privatization pursuant to section 613 (a) if 
     privatization occurs earlier.
       ``(b) Notwithstanding subsection (a), INTELSAT shall be 
     prohibited from entering the United States market directly to 
     provide any satellite communications services or space 
     segment capacity to any foreign signatory, or affiliate 
     thereof, and no carrier, other than the United States 
     signatory, nor any end user, shall be permitted to invest 
     directly in INTELSAT.
       ``(c) Pending INTELSAT's privatization, the Commission 
     shall ensure that the United States signatory is compensated 
     by direct access users for the costs it incurs in fulfilling 
     its obligations under this Act.
       ``(d) The provisions of subsections (b) and (c) shall 
     remain in effect only until INTELSAT achieves a pro-
     competitive privatization pursuant to section 613 (a).

   ``Subtitle B--Actions to Ensure Pro-Competitive Satellite Services

     ``SEC. 611. PRIVATIZATION.

       ``(a) In General.--The President shall seek a pro-
     competitive privatization of INTELSAT as soon as practicable, 
     but no later than January 1, 2002. Such privatization shall 
     be confirmed by a final decision of the INTELSAT Assembly of 
     Parties and shall be followed by a timely initial public 
     offering taking into account relative market conditions.
       ``(b) Ensure Continuation of Privatization.--The President 
     and the Commission shall seek to ensure that the 
     privatization of Inmarsat continues in a pro-competitive 
     manner.

     ``SEC. 612. PROVISION OF SERVICES IN THE UNITED STATES BY 
                   PRIVATIZED AFFILIATES OF INTERGOVERNMENTAL 
                   SATELLITE ORGANIZATIONS.

       ``(a) In General.--With respect to any application for a 
     satellite earth station or space station under title III of 
     the Communications Act of 1934 (47 U.S.C 301 et seq.) or any 
     application under section 214 of that Act (47 U.S.C. 214), or 
     any letter of intent to provide service in the United States 
     via non-United States licensed space segment, submitted by a 
     privatized IGO affiliate or successor, the Commission--
       ``(1) shall apply a presumption in favor of entry to an IGO 
     affiliate or successor licensed by a WTO Member for services 
     covered by United States commitments under the WTO Basic 
     Telecom Agreement;
       ``(2) may attach conditions to any grant of authority to an 
     IGO affiliate or successor that raises the potential for 
     competitive harm; or
       ``(3) shall in the exceptional case in which an application 
     by an IGO affiliate or successor would pose a very high risk 
     to competition in the United States satellite market, deny 
     the application.
       ``(b) Determination Factors.--In determining whether an 
     application to serve the United States market by an IGO 
     affiliate raises the potential for competitive harm or risk 
     under subsection (a)(2), the Commission shall determine 
     whether any potential anti-competitive or market distorting 
     consequences of continued relationships or connections exist 
     between an IGO and its affiliates including--
       ``(1) whether the IGO affiliate is structured to prevent 
     anti-competitive practices such as collusive behavior or 
     cross-subsidization;
       ``(2) the degree of affiliation between the IGO and its 
     affiliate;
       ``(3) whether the IGO affiliate can directly or indirectly 
     benefit from IGO privileges and immunities;
       ``(4) the ownership structure of the affiliate and the 
     effect of IGO and other Signatory ownership and whether the 
     affiliate is independent of IGO signatories or former 
     signatories who control telecommunications market access in 
     their home territories;
       ``(5) the existence of clearly defined arm's-length 
     conditions governing the affiliate-IGO relationship including 
     separate officers, directors, employees, and accounting 
     systems;
       ``(6) the existence of fair market valuing for permissible 
     business transactions between an IGO and its affiliate that 
     is verifiable by an independent audit and consistent with 
     normal commercial practice and generally accepted accounting 
     principles;
       ``(7) the existence of common marketing;
       ``(8) the availability of recourse to IGO assets for credit 
     or capital;
       ``(9) whether an IGO registers or coordinates spectrum or 
     orbital locations on behalf of its affiliate; and
       ``(10) whether the IGO affiliate has corporate charter 
     provisions prohibiting reaffiliation with the IGO after 
     privatization.
       ``(c) Sunset.--The provisions of subsection (b) shall cease 
     to have effect upon approval of the application pursuant to 
     section 613.
       ``(d) Public Interest Determination.--Nothing in this Act 
     affects the Commission's ability to make a public interest 
     determination concerning any application pertaining to entry 
     into the United States market.

     ``SEC. 613. PRESIDENTIAL NEGOTIATING OBJECTIVES AND FCC 
                   CRITERIA FOR PRIVATIZED IGOS.

       ``(a) In General.--Upon a final decision of the INTELSAT 
     Assembly of Parties creating the legal structure and 
     characteristics of the privatized INTELSAT and recognizing 
     that Inmarsat transitioned into a private company on April 
     15, 1999, the President shall within 30 days report to the 
     Congress on the extent to which such privatization framework 
     meets each of the criteria in subsection (c), and whether 
     taking into consideration all other relevant competitive 
     factors, entry of a privatized INTELSAT or Inmarsat into the 
     United States market will not be likely to distort 
     competition.

[[Page H11938]]

       ``(b) Purpose of Privatization Criteria.--The criteria 
     provided in subsection (c) shall be used as--
       ``(1) the negotiation objectives for achieving the 
     privatization of INTELSAT no later than January 1, 2002, and 
     also for Inmarsat;
       ``(2) the standard for measuring, pursuant to subsection 
     (a), whether negotiations have resulted in an acceptable 
     framework for achieving the pro-competitive privatization of 
     INTELSAT and Inmarsat; and
       ``(3) licensing criteria by the Commission in making its 
     independent determination of whether the certified framework 
     for achieving the pro-competitive privatization of INTELSAT 
     and Inmarsat has been properly implemented by the privatized 
     INTELSAT and Inmarsat.
       ``(c) Privatization Criteria.--A pro-competitively 
     privatized INTELSAT or Inmarsat--
       ``(1) has no privileges or immunities limiting legal 
     accountability, commercial transparency, or taxation and does 
     not unfairly benefit from ownership by former signatories who 
     control telecommunications market access to their home 
     territories;
       ``(2) has submitted to the jurisdiction of competition and 
     independent regulatory authorities of a nation that is a 
     signatory to the World Trade Organization Agreement on Basic 
     Telecommunications and that has implemented or accepted the 
     agreement's reference paper on regulatory principles;
       ``(3) can offer assurance of an arm's-length relationship 
     in all respects between itself and any IGO affiliate;
       ``(4) has given due consideration to the international 
     connectivity requirements of thin route countries;
       ``(5) can demonstrate that the valuation of assets to be 
     transferred post-privatization is in accordance with 
     generally accepted accounting principles;
       ``(6) has access to orbital locations and associated 
     spectrum post-privatization in accordance with the same 
     regulatory processes and fees applicable to other commercial 
     satellite systems;
       ``(7) conducts technical coordinations post-privatization 
     under normal, established ITU procedures;
       ``(8) has an ownership structure in the form of a stock 
     corporation or other similar and accepted commercial 
     mechanism, and a commitment to a timely initial public 
     offering has been established for the sale or purchase of 
     company shares;
       ``(9) shall not acquire, or enjoy any agreements or 
     arrangements which secure, exclusive access to any national 
     telecommunications market; and
       ``(10) will have accomplished a privatization consistent 
     with the criteria listed in this subsection at the earliest 
     possible date, but not later than January 1, 2002, for 
     INTELSAT and Inmarsat.
       ``(d) FCC Independent Determination on Implementation.--
     After the President has made a report to Congress pursuant to 
     subsection (a), with respect to any application for a 
     satellite earth station or space station under title III of 
     the Communications Act of 1934 (47 U.S.C. 301) or any 
     application under section 214 of the Communications Act of 
     1934 (47 U.S.C. 214), or any letter of intent to provide 
     service in the United States via a non-United States licensed 
     space segment, submitted by a privatized affiliate prior to 
     the privatized IGO, or by a privatized IGO, the Commission 
     shall determine whether the enumerated objectives for a pro-
     competitive privatization of INTELSAT and Inmarsat under this 
     section have been implemented with respect to the privatized 
     IGO, but in making that consideration, may neither contract 
     or expand the privatization criteria in subsection (c).
       ``(e) Authority to Deny an Application.--Nothing in this 
     section affects the Commission's authority to condition or 
     deny an application on the basis of the public interest.

     ``SEC. 614. FAILURE TO PRIVATIZE IN A TIMELY MANNER.

       ``(a) Report.--In the event that INTELSAT fails to fully 
     privatize as provided in section 611 by January 1, 2002, the 
     President shall--
       ``(1) instruct all instrumentalities of the United States 
     Government to grant a preference for procurement of satellite 
     services from commercial private sector providers of 
     satellite space segment rather than IGO providers;
       ``(2) immediately commence deliberations to determine what 
     additional measures should be implemented to ensure the rapid 
     privatization of INTELSAT;
       ``(3) no later than March 31, 2002, issue a report 
     delineating such other measures to the Committee on Commerce 
     of the House of Representatives, and Committee on Commerce, 
     Science, and Transportation of the Senate; and
       ``(4) withdraw as a party from INTELSAT.
       ``(b) Reservation Clause.--The President may determine, 
     after consulting with Congress, that in consideration of 
     privatization being imminent, it is in the national interest 
     of the United States to provide a reasonable extension of 
     time for completion of privatization.

             ``Subtitle C--COMSAT Governance and Operation

     ``SEC. 621. ELIMINATION OF PRIVILEGES AND IMMUNITIES.

       ``(a) Comsat.--COMSAT shall not have any privilege or 
     immunity on the basis of its status as a signatory or a 
     representative of the United States to INTELSAT and Inmarsat, 
     except that COMSAT retains its privileges and immunities--
       ``(1) for those actions taken in its role as the United 
     States signatory to INTELSAT or Inmarsat upon instruction of 
     the United States Government; and
       ``(2) for actions taken when acting as the United States 
     signatory in fulfilling signatory obligations under the 
     INTELSAT Operating Agreement.
       ``(b) No Joint or Several Liability.--If COMSAT is found 
     liable for any action taken in its status as a signatory or a 
     representative of the party to INTELSAT, any such liability 
     shall be limited to the portion of the judgment that 
     corresponds to COMSAT's percentage of the responsibility, as 
     determined by the trier of fact.
       ``(c) Prospective Effect of Elimination.--The elimination 
     of privileges and immunities contained in this section shall 
     apply only to actions or decisions taken by COMSAT after the 
     date of enactment of the Open-market Reorganization for the 
     Betterment of International Telecommunications Act.

     ``SEC 622. ABROGATION OF CONTRACTS PROHIBITED.

       ``Nothing in this Act or the Communications Act of 1934 (47 
     U.S.C. 151 et seq.) shall be construed to modify or 
     invalidate any contract or agreement involving COMSAT, 
     INTELSAT, or any terms or conditions of such agreement in 
     force on the date of enactment of the Open-market 
     Reorganization for the Betterment of International 
     Telecommunications Act, or to give the Commission authority, 
     by rule-making or any other means, to invalidate any such 
     contract or agreement, or any terms and conditions of such 
     contract or agreement.

     ``SEC. 623. PERMITTED COMSAT INVESTMENT.

       ``Nothing in this Act shall be construed as precluding 
     COMSAT from investing in or owning satellites or other 
     facilities independent from INTELSAT, or from providing 
     services through reselling capacity over the facilities of 
     satellite systems independent from INTELSAT. This section 
     shall not be construed as restricting the types of contracts 
     which can be executed or services which may be provided by 
     COMSAT over the independent satellites or facilities 
     described in this subsection.

                    ``Subtitle D--General Provisions

     ``SEC. 631. PROMOTION OF EFFICIENT USE OF ORBITAL SLOTS AND 
                   SPECTRUM.

       ``All satellite system operators authorized to access the 
     United States market should make efficient and timely use of 
     orbital and spectrum resources in order to ensure that these 
     resources are not warehoused to the detriment of other new or 
     existing satellite system operators. Where these assurances 
     cannot be provided, satellite system operators shall 
     arbitrate their rights to these resources according to ITU 
     procedures.

     ``SEC. 632. PROHIBITION ON PROCUREMENT PREFERENCES.

       ``Except pursuant to section 615 of this Act, nothing in 
     this title or the Communications Act of 1934 (47 U.S.C. 151 
     et seq.) shall be construed to authorize or require any 
     preference in Federal Government procurement of 
     telecommunications services, for the satellite space segment 
     provided by INTELSAT or Inmarsat, nor shall anything in this 
     title or that Act be construed to result in a bias against 
     the use of INTELSAT or Inmarsat through existing or future 
     contract awards.

     ``SEC. 633. SATELLITE AUCTIONS.

       ``Notwithstanding any other provision of law, the 
     Commission shall not assign by competitive bidding orbital 
     locations or spectrum used for the provision of international 
     or global satellite communications services. The President 
     shall oppose in the International Telecommunications Union 
     and in other bilateral and multilateral negotiations any 
     assignment by competitive bidding of orbital locations, 
     licenses, or spectrum used for the provision of such 
     services.

     ``SEC. 634. RELATIONSHIP TO OTHER LAWS.

       ``Whenever the application of the provisions of this Act is 
     inconsistent with the provisions of the Communications Act of 
     1934, the provisions of this Act shall govern.

     ``SEC. 635. EXCLUSIVITY ARRANGEMENTS.

       ``(a) In General.--No satellite operator shall acquire or 
     enjoy the exclusive right of handling traffic to or from the 
     United States, its territories or possessions, and any other 
     country or territory by reason of any concession, contract, 
     understanding, or working arrangement to which the satellite 
     operator or any persons or companies controlling or 
     controlled by the operator are parties.
       ``(b) Exception.--In enforcing the provisions of this 
     subsection, the Commission--
       ``(1) shall not require the termination of existing 
     satellite telecommunications services under contract with, or 
     tariff commitment to, such satellite operator; but
       ``(2) may require the termination of new services only to 
     the country that has provided the exclusive right to handle 
     traffic, if the Commission determines the public interest, 
     convenience, and necessity so requires.

                       ``Subtitle E--Definitions

     ``SEC. 641. DEFINITIONS.

       ``(a) In General.--In this title:
       ``(1) INTELSAT.--The term `INTELSAT' means the 
     International Telecommunications Satellite Organization 
     established pursuant to the Agreement Relating to the 
     International Telecommunications Satellite Organization.

[[Page H11939]]

       ``(2) Inmarsat.--The term `Inmarsat' means the 
     International Mobile Satellite Organization established 
     pursuant to the Convention on the International Maritime 
     Satellite Organization and may also refer to INMARSAT Limited 
     when appropriate.
       ``(3) COMSAT.--The term `COMSAT' means the corporation 
     established pursuant to title III of this Act and its 
     successors and assigns.
       ``(4) Signatory.--The term `signatory' means the 
     telecommunications entity designated by a party that has 
     signed the Operating Agreement and for which such Agreement 
     has entered into force.
       ``(5) Party.--The term `party' means, in the case of 
     INTELSAT, a nation for which the INTELSAT agreement has 
     entered into force or been provisionally applied, and in the 
     case of INMARSAT, a nation for which the Inmarsat convention 
     entered into force.
       ``(6) Commission.--The term `Commission' means the Federal 
     Communications Commission.
       ``(7) International telecommunication union; ITU.--The 
     terms `International Telecommunication Union' and `ITU' mean 
     the intergovernmental organization that is a specialized 
     agency of the United Nations in which member countries 
     cooperate for the development of telecommunications, 
     including adoption of international regulations governing 
     terrestrial and space uses of the frequency spectrum as well 
     as use of the geostationary orbital arc.
       ``(8) Privatized INTELSAT.--The term `privatized INTELSAT' 
     means any entity created from the privatization of INTELSAT 
     from the assets of INTELSAT.
       ``(9) Privatized Inmarsat.--The term `privatized Inmarsat' 
     means any entity created from the privatization of Inmarsat 
     from the assets of Inmarsat, namely INMARSAT, Ltd.
       ``(10) Orbital location.--The term `orbital location' means 
     the location for placement of a satellite in geostationary 
     orbits as defined in the International Telecommunication 
     Union Radio Regulations.
       ``(11) Spectrum.--The term `spectrum' means the range of 
     frequencies used to provide radio communication services.
       ``(12) Space segment.--The term `space segment' means the 
     satellites, and the tracking, telemetry, command, control, 
     monitoring and related facilities and equipment used to 
     support the operation of satellites owned or leased by 
     INTELSAT and Inmarsat or an IGO successor or affiliate.
       ``(13) INTELSAT agreement.--The term `INTELSAT agreement' 
     means the agreement relating to the International 
     Telecommunications Satellite Organization, including all of 
     its annexes (TIAS 7532, 23 UST 3813).
       ``(14) Operating agreement.--The term `operating agreement' 
     means--
       ``(A) in the case of INTELSAT, the agreement, including its 
     annex but excluding all titles of articles, opened for 
     signature at Washington on August 20, 1971, by governments or 
     telecommunications entities designated by governments in 
     accordance with the provisions of The Agreement; and
       ``(B) in the case of Inmarsat, the Operating Agreement on 
     the International Maritime Satellite Organization, including 
     its annexes.
       ``(15) Headquarters agreement.--The term `headquarters 
     agreement' means the binding international agreement, dated 
     November 24, 1976, between the United States and INTELSAT 
     covering privileges, exemptions, and immunities with respect 
     to the location of INTELSAT's headquarters in Washington, 
     D.C.
       ``(16) Direct-to-home satellite services.--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.
       ``(17) IGO.--The term `IGO' means the Intergovernmental 
     Satellite organizations, INTELSAT and Inmarsat.
       ``(18) IGO affiliate.--The term `IGO affiliate' means any 
     entity in which an IGO owns or has owned an equity interest 
     of 10 percent or more.
       ``(19) IGO successor.--The term `IGO Successor' means an 
     entity which holds substantially all the assets of a pre-
     existing IGO.
       ``(20) Global maritime distress and safety services.--The 
     term `global maritime distress and safety services' means the 
     automated ship-to-shore distress alerting system which uses 
     satellite and advanced terrestrial systems for international 
     distress communications and promoting maritime safety in 
     general, permitting the worldwide alerting of vessels, 
     coordinated search and rescue operations, and dissemination 
     of maritime safety information.
       ``(b) Common Terms.--Except as otherwise provided in 
     subsection (a), terms used in this title that are defined in 
     section 3 of the Communications Act of 1934 (47 U.S.C. 153) 
     have the meaning provided in that section.''.

     SEC. 5. CONFORMING CHANGES.

       (a) Repeal of Federal Coordination and Planning 
     Provisions.--Section 201 of the Communications Satellite Act 
     of 1962 (47 U.S.C. 721) is amended to read as follows:

     ``SEC. 201. IMPLEMENTATION OF POLICY.

       ``The Federal Communications Commission, in its 
     administration of the Communications Act of 1934, shall make 
     rules and regulations to carry out the provisions of this 
     Act.''.
       (b) Repeal of Government-Established Corporation 
     Provisions.--
       (1) In general.--Section 301 of the Communications 
     Satellite Act of 1962 (47 U.S.C. 731) is amended to read as 
     follows:

     ``SEC. 301. CORPORATION.

       ``The corporation organized under the provisions of this 
     title, as this title existed before the enactment of the 
     Open-market Reorganization for the Betterment of 
     International Telecommunications Act, known as COMSAT, and 
     its successors and assigns, are subject to the provisions of 
     this Act. The right to repeal, alter, or amend this Act at 
     any time is expressly reserved.''.
       (2) Conforming changes.--Title III of the Communications 
     Satellite Act of 1962 (47 U.S.C. 731 et seq.) is amended--
       (A) by striking ``CREATION OF A COMMUNICATIONS SATELLITE'' 
     in the caption of title III;
       (B) by striking sections 302, 303, and 304;
       (C) by redesignating section 305 as section 302; and
       (D) by striking subsection (c) of section 302, as 
     redesignated.
       (c) Repeal of Certain Miscellaneous Provisions.--Title IV 
     of the Communications Satellite Act of 1962 (47 U.S.C. 741 et 
     seq.) is amended--
       (1) by striking section 402;
       (2) by striking subsection (a) of section 403 and 
     redesignating subsections (b) and (c) as subsections (a) and 
     (b), respectively; and
       (3) by striking section 404.

     SEC. 6. INTERNATIONAL MARITIME SATELLITE TELECOMMUNICATIONS 
                   ACT AMENDMENTS.

       (a) Repeal of Superseded Authority.--Title V of the 
     Communications Satellite Act of 1962 (47 U.S.C. 751 et seq.) 
     is amended--
       (1) by striking sections 502, 503, 504, and 505; and
       (2) by inserting after section 501 the following:

     ``SEC. 502. GLOBAL SATELLITE SAFETY SERVICES AFTER 
                   PRIVATIZATION OF BUSINESS OPERATIONS OF 
                   INMARSAT.

       ``In order to ensure the continued provision of global 
     maritime distress and safety satellite telecommunications 
     services after privatization of the business operations of 
     Inmarsat, the President may maintain membership in the 
     International Mobile Satellite Organization on behalf of the 
     United States.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     take effect on the date on which the International Mobile 
     Satellite Organization ceases to operate directly a global 
     mobile satellite system.


                      Motion Offered by Mr. Tauzin

  Mr. TAUZIN. Mr. Speaker, I offer a motion.
  The Clerk read as follows:

       Mr. TAUZIN moves that the House strike all after the 
     enacting clause of a Senate bill, S. 376, and insert the text 
     of the bill, H.R. 3261, as passed by the House.

  The motion was agreed to.
  The Senate bill was ordered to be read a third time, was read the 
third time, and passed, and a motion to reconsider was laid on the 
table.
  A similar House bill (H.R. 3261) was laid on the table.


                        Appointment of Conferees

  Mr. TAUZIN. Mr. Speaker, I ask unanimous consent that the House 
insist on its amendment and request a conference with the Senate 
thereon.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Louisiana? The Chair hears none and, without objection, 
appoints the following conferees: Messrs. Bliley, Tauzin, Oxley, 
Dingell, and Markey.
  There was no objection.

                          ____________________