[Federal Register Volume 64, Number 69 (Monday, April 12, 1999)]
[Notices]
[Pages 17625-17626]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-8952]


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DEPARTMENT OF COMMERCE

NATIONAL TELECOMMUNICATIONS AND INFORMATION ADMINISTRATION
[Docket No. 990405086-9086-01]
RIN 0660-ZA08


Market for Satellite Communications and the Role of 
Intergovernmental Satellite Organizations

AGENCY: National Telecommunications and Information Administration, 
Commerce.

ACTION: Notice, request for comments.

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SUMMARY: The Department of Commerce requests comments regarding the 
advantages accorded signatories of intergovernmental satellite 
organizations (ISOs), in terms of immunities, market access, or 
otherwise, in the countries or regions served by the International 
Telecommunications Satellite Organization (INTELSAT) and the 
International Mobile Satellite Organization (Inmarsat), the reason for 
such advantages, and an assessment of progress toward fulfilling a pro-
competitive privatization of those organizations. The International 
Anti-Bribery and Fair Competition Act of 1998 implements the 
Organization for Economic Cooperation and Development (OECD) Convention 
on Combating Bribery of Foreign Public Officials in International 
Business Transactions (the OECD Convention). In that legislation, the 
U.S. Congress imposed certain reporting requirements for the Department 
of Commerce that are due on July 1, 1999 and each of the next five 
years. The House report on the legislation expresses an expectation for 
extensive fact-findings on the nature of the market for satellite 
communications and, in particular, the role of the ISOs, INTELSAT and 
Inmarsat. The Department notes that Inmarsat is scheduled for 
privatization on April 15, 1999. The reporting requirements monitor the 
implementation and enforcement of other nations' commitments under the 
OECD Convention and promote the reduction of privileges and immunities 
for the ISOs. This Request for Comments (RFC) will assist the Secretary 
of Commerce in responding to those reporting requirements regarding the 
ISOs' privileges and immunities.

DATES: Comments must be received by May 12, 1999.

ADDRESSES: The Department invites the public to submit written comments 
in paper or electronic form. Comments may be mailed to Milton Brown, 
National Telecommunications and Information Administration (NTIA), Room 
4713, U.S. Department of Commerce, 14th and Constitution Avenue, NW, 
Washington, DC 20230. Paper submissions should include a version on 
diskette in ASCII, Word Perfect (please specify version), or Microsoft 
Word (please specify version) format.
    Comments submitted in electronic form may be sent to 
[email protected]. Electronic comments should be submitted in 
the formats specified above.

FOR FURTHER INFORMATION CONTACT: Milton Brown, NTIA/OCC, (202) 482-
1816.

SUPPLEMENTARY INFORMATION:

Background

    INTELSAT is a treaty-based global communications satellite 
cooperative with 143 member countries. INTELSAT was created to enhance 
global communications and to spread the risks of creating a global 
satellite system across telephone operating companies from many 
countries. 1 Inmarsat was created to improve the global 
maritime communications satellite system that would provide distress, 
safety, and communications services to seafaring nations in a 
cooperative, cost-sharing entity. Inmarsat is scheduled for 
privatization on April 15, 1999.
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    \1\ See Treaty on Principles Governing the Activities of States 
in the Exploration and Use of Outer Space, Including the Moon and 
Other Celestial Bodies.
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    As intergovernmental satellite organizations, both INTELSAT and 
Inmarsat are governed by ``Parties'' and managed by ``signatories.'' 
The Parties are the national government members of the INTELSAT and 
Inmarsat agreements. Signatories are designated by each party to 
participate in the commercial operations of the organization. They hold 
ownership interests in varying degrees. They also assist with the 
operation and management of the systems and are distributors of ISO 
services in their own countries. Signatories may be government-owned or 
controlled telecommunications monopolies or other telecommunications 
service providers. The publically traded Comsat Corp. is the U.S. 
Signatory to INTELSAT. ISOs are subject to oversight by the Assembly of 
Parties, and signatories are subject to oversight by their respective 
governments.
    To implement public service obligations effectively and as part of 
the ISOs' unique treaty status, the ISOs benefit from certain 
privileges and immunities. As such, these ISOs are generally immune 
from suit, including private or public prosecution on antitrust 
charges. Moreover, neither ISO pays taxes on revenues, and exemption 
extends to import duties and taxes, communications and property taxes. 
Signatories, however, are subject to national taxes, including for 
their share of the organizations' distributed returns.
    The International Anti-Bribery and Fair Competition Act of 1998 
requires the Secretary of Commerce to submit a report to the House of 
Representatives and the Senate which contains information regarding the 
OECD Convention which includes the following: (1) A list of countries 
that have ratified the Convention; (2) a description of the domestic 
laws enacted by each party to the Convention that implements 
commitments under the Convention; and (3) an assessment of the measures 
taken by each party to the Convention during the previous year to 
fulfill its obligations under the Convention. See Pub. L. No 105-366, 
sec. 6(a). Accordingly, the Secretary of Commerce is required to 
report, inter alia, on the ``terms of market access, government 
ownership, government contracts or connections, privileges and 
immunities, favorable treatment by national regulatory authorities or 
tax treatment . . . in the countries or regions served by the [ISOs], 
and the reasons for such advantages.'' H.R. REP. NO. 105-802, at 9 
(1998). In preparation for this report, the Secretary of Commerce is 
required to seek and incorporate comments from the private sector, 
including competing satellite companies and satellite services users. 
Id.
    We are now formally soliciting public comment on the advantages, in 
terms of immunities, market access, or otherwise, in the countries or 
regions served by INTELSAT and Inmarsat, the reasons for such 
advantages, and an assessment of progress toward fulfilling a pro-
competitive privatization of those

[[Page 17626]]

organizations. ``Pro-competitive privatization'' is defined as 
``privatization that the President determines to be consistent with the 
United States policy of obtaining full and open competition to such 
organizations (or their successors), and nondiscriminatory market 
access, in the provision of satellite services.'' See Pub. L. No 105-
366, sec. 5(a)(2). Respondents should find it useful to review the full 
text of the International Anti-Bribery and Fair Competition Act of 
1998.
Kathy Smith,
Acting Chief Counsel.
[FR Doc. 99-8952 Filed 4-9-99; 8:45 am]
BILLING CODE 3510-60-P