[Federal Register Volume 64, Number 7 (Tuesday, January 12, 1999)]
[Notices]
[Pages 1822-1823]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-610]


-----------------------------------------------------------------------

DEPARTMENT OF JUSTICE

Antitrust Division


U.S. versus Concert plc and MCI Communications Corporation; 
United States Notice of Defendant's Motion to Terminate Modified Final 
Judgment

    Notice is hereby given that MCI WorldCom, Inc. (``MCI WorldCom''), 
successor-in-interest to defendant MCI Communications Corporation 
(``MCI''), and British Telecommunications plc (``BT''), predecessor-in-
interest to defendant Concert plc, have moved to terminate the Modified 
Final Judgment entered by this Court on September 16, 1997. In a 
stipulation also filed with the Court, the Department of Justice 
(``Department'') has tentatively consented to termination of the 
Judgment, but has reserved the right to withdraw its consent pending 
receipt of public comments.
    On June 15, 1994, the United States filed its complaint in this 
case. The complaint alleged that the acquisition by British 
Telecommunications plc (``BT'') of a 20% ownership interest in MCI 
Communications Corporation (``MCI'') created an incentive for BT, using 
its existing market power in the

[[Page 1823]]

United Kingdom, to favor MCI at the expense of other United States 
international carriers in the market or markets for international 
telecommunications services between the United States and the United 
Kingdom. The complaint also alleged that the formation of a joint 
venture between BT and MCI to provide seamless global network services 
to multinational corporations created an incentive for BT to use its 
dominance in the UK to favor the joint venture at the expense of other 
global network service providers in the provision of the UK segment 
essential to any seamless global network.
    The Final Judgment, filed contemporaneously with the complaint and 
entered by the Court on September 29, 1994 after a Tunney Act review, 
contained three categories of provisions designed to remedy the 
anticompetitive effects of the partial acquisition: (1) transparency or 
reporting provisions; (2) confidentiality provisions; and (3) a 
provision relating to International Simple Resale (``ISR''). These 
provisions were specifically designed to diminish the risk that BT 
would successfully act on its incentive to use its market power to 
discriminate in favor of MCI or the joint venture. After the Final 
Judgment was entered, BT and MCI consummated BT's 20% acquisition and 
formed the joint venture known as Concert Communications Company.
    In November 1996, BT and MCI entered into a Merger Agreement and 
Plan of Merger pursuant to which BT agreed to acquire the remaining 80% 
of MCI. The new parent company was to be renamed Concert plc. Although 
the Department had thoroughly analyzed all of the competitive 
consequences associated with BT's initial 20% acquisition of MCI, the 
Department undertook an evaluation of the changes in market conditions 
since 1994 in order to determine whether a modification of the existing 
decree was appropriate under the circumstances.
    As a result of its new analysis, the Department concluded that BT's 
incentives and ability to discriminate against MCI's and Concert's 
competitors still existed. Consequently, the Department recommended 
that the provisions of the Final Judgment aimed at deterring and 
detecting discrimination be retained and, in some circumstances, 
strengthened. In addition, the Department determined that certain 
modifications to the confidentiality provisions were necessary in order 
to ensure that the proposed full integration of BT and MCI would not 
impair the effectiveness of the protection afforded by the Final 
Judgment. On September 16, 1997, after fully considering the comments 
received and the United States' response to those comments, the Court 
entered the Modified Final Judgment proposed by the parties.
    Thereafter, on November 9, 1997, MCI and BT terminated their merger 
agreement and BT agreed to acquire MCI's 24.9% interest in the Concert 
joint venture. Contemporaneously therewith, MCI entered into a new 
merger agreement with WorldCom, Inc. (``WorldCom''), and WorldCom 
agreed to acquire BT's 20% interest in MCI. On September 15, 1998, the 
foregoing transactions were consummated. Currently, BT has no equity 
interest in MCI or MCI WorldCom. Conversely, neither MCI WorldCom nor 
MCI has any equity interest in the Concert joint venture.
    The Department, MCI WorldCom and BT have filed memoranda with the 
Court setting forth the reasons why they believe that termination of 
the Modified Final Judgment would serve the public interest. Copies of 
MCI WorldCom's and BT's motion to terminate, the stipulation containing 
the Department's consent, the supporting memoranda, and all additional 
papers filed with the Court in connection with this motion will be 
available for inspection at the Antitrust Documents Group of the 
Antitrust Division, U.S. Department of Justice, Room 215, North Liberty 
Place Building, 325 7th Street, N.W., Washington, D.C. 20004, and at 
the Office of the Clerk of the United States District Court for the 
District of Columbia. Copies of these materials may be obtained from 
the Antitrust Division upon request and payment of the duplicating fee 
determined by Department of Justice regulations.
    Interested persons may submit comments regarding the proposed 
termination of the Judgment to the Department. Such comments must be 
received by the Antitrust Division within sixty (60) days and will be 
filed with the Court by the Department. Comments should be addressed to 
Donald J. Russell, Chief, Telecommunications Task Force, Antitrust 
Division, U.S. Department of Justice, 1401 H Street, N.W., Suite 8000, 
Washington, D.C. 20005, telephone (202) 514-6381.
Constance K. Robinson,
Director of Operations & Merger Enforcement, Antitrust Division.
[FR Doc. 99-610 Filed 1-11-99; 8:45 am]
BILLING CODE 4410-11-M