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ITC93328(#   X1-GTI Network, Inc.GNI LETTER hh@h) pp   ITC94435(#   X -MFS International, Inc.` hh@Xh)Xpp   ITC95015(#p  X -Communications Telesystems International@Xh)Xpp   ITC95116(#   X -INTEX Telecommunications, Inc. hhX@Xh)Xpp   ITC95185(#   X - Cherry Communications, Inc.hh@h)ppX  ITC96182(#  x` `  hh@h)  X -Applications for authority pursuant to Section 214hh)(#  X-of the Communications Act of 1934, as amended,hh)(#  Xy-to resell international private line services @h)  Xb-interconnected to the public switched network h)  XK-("PSN") for the provision of service between the h)  X4-United States and Australiahh@h) x` `  hh@h)  X-Telstra, Inc.` `  hh@h)pp  ITC96319  X-x` `  hh@h)  X-Application for authority pursuant to Section 214hh)(#  X-of the Communications Act of 1934, as amendedh)  X-to resell international message telephone service,h)  X-international private line serviceshh@h)  X|-interconnected to the PSN, and internationalh)pp  Xe-private lines not interconnected to the PSN forh)  XN-the provision of service between the United Statesh)  X7-and Australia` `  hh@h)  X -  MEMORANDUM OPINION, ORDER AND CERTIFICATE T  X-TP xAdopted: December 16, 1997 @XhXppReleased: December 17, 1997 (#p  X - By the Chief, International Bureau:  X#-, I. INTRODUCTION  XQ%-x1.` ` In this decision we grant Cable & Wireless, Inc. ("CWI"), GTI Network, Inc. ("GNI"), MFS International, Inc. ("MFSI"), Communication Telesystems International":&0*''II$"  X-("CTS"), INTEX Telecommunications Inc. ("INTEX"), Cherry Communications, Inc. ("CCI"), and Telstra, Inc. ("TI") authority pursuant to Section 214 of the Communications Act, as  X-amended ("Act"), and Section 63.18(e)(3) of the Commission's rules,h yOK-ԍXx47 U.S.C.  214; 47 C.F.R.  63.18(e)(3).(#h to resell international private lines ("IPLs") interconnected to the public switched network ("PSN") for the provision of switched services between the United States and Australia. We also grant TI authority to resell switched services and to resell IPLs not interconnected to the PSN for the provision of switched services between the United States and Australia.  XH-  II. BACKGROUND AND PLEADINGS ă  X -Xx A.X` ` The Applicants (#`  X -  X -x2.` ` CWI, a U.S. corporation, is authorized to provide international switched and  X -private line services between the United States and various international points. X {O-ԍXxSee e.g., Cable & Wireless, Inc., Order, Authorization and Certificate, 11 FCC Rcd 16486 (Int'l Bur.,  {O-1996); Cable & Wireless, Inc., Memorandum Opinion, Order and Authorization, 9 FCC Rcd 6509 (Int'l  {Or-Bur., 1994); Cable & Wireless, Inc., Memorandum Opinion, Order and Authorization, 9 FCC Rcd 7283  {O<-(Int'l Bur., 1994); Cable & Wireless Communications, Inc., Order, Authorization and Certificate, 6 FCC  {O-Rcd 236 (Com. Car. Bur., 1991); Cable & Wireless Communications, Inc., Order, Authorization and  {O-Certificate, 5 FCC Rcd 7583 (Com. Car. Bur., 1990). See also Letter from Paul W. Kenefick,  {O-Regulatory Counsel, CWI to William F. Caton, Acting Secretary, FCC (Sept. 18, 1997) ("CWI Letter").(#ƨ CWI LTR  CWI's sole shareholder and ultimate corporate parent is Cable & Wireless, plc. ("C&W"), a U.K.  X -corporation.   yO-ԍXxApplication of CWI to Resell IPLs Interconnected to the PSN for the Provision of Switched Services Between the United States and Canada, the United Kingdom, Australia and Sweden, ITC93328 (filed Sep. 9, 1993) ("CWI Application"). CWI is a whollyowned subsidiary of Cable & Wireless Holding, Inc., which is a whollyowned subsidiary of C&W. (#Ƒ C&W holds an equity interest of 49 percent in Optus Communications Pty  X-Limited ("Optus"), a carrier that provides domestic and international common carrier services,  Xy-including service between Australia and the United States.`y  {O-ԍXxCWI Letter at CWI LTR2.(#`  XK-x3.` ` GNI is authorized to offer resold international switched telecommunications  X4-services between the United States and various international points.X4  yO"-ԍXxApplication of Global Telecommunications, Inc. to Resell IPLs Interconnected to the PSN for the Provision of Switched Services Between the United States and Australia, ITC94435 at 2 (filed Aug. 3, 1994) ("GNI Application"). (# GNI is a whollyowned subsidiary of Primus Holding Corporation ("PHC"), which is a whollyowned subsidiary of"@0*%%II "  X-Primus Telecommunications Group, Inc. ("PTGI").$ {Oy-ԍXxGlobal Telecommunications, Inc. ("GTI"), the original applicant, was granted a pro forma transfer of control. GTI's international Section 214 authorizations were transferred to GTI Network, Inc. ("GNI"). Letter from Margaret M. Charles, Counsel for GTI Network, Inc. to GNI LETTERGNI LETTERWilliam F. Caton, Acting Secretary,  {O-Federal Communications Commission, ITC94435 (Feb. 28, 1996) ("GNI Letter"). (#GNIGNI PTGI holds a 100 percent indirect  X-interest in Axicorp, an Australian carrier providing resale services.S {ON-ԍXxSee id. (#S  X-x4.` ` MFSI, a Delaware corporation, is a whollyowned subsidiary of MFS Network Technologies, Inc., ("MFSNT"), a Delaware corporation. MFSNT is a whollyowned subsidiary of MFS Communications Company, Inc. ("MFSCC"), a Delaware corporation.  Xv-MFSCC is a whollyowned subsidiary of WorldCom, Inc., a Georgia corporation."vF yOm -ԍXxApplication of MFSI to Resell IPLs Interconnected to the PSN to Provide Switched Services Between the United States and Australia, ITC95015 at 23 (filed Oct. 5, 1994) ("MFSI Application"); MFS  {O-Communications Company, Inc. and WorldCom, Inc., Memorandum Opinion, Order, and Authorization, 11 FCC Rcd 21164 (Int'l Bur., 1996).(#ƚ MFSI and WorldCom, Inc. both hold multiple Section 214 authorizations, including authority to offer both resold and facilitiesbased international services on a global basis as a nondominant  X1-common carrier.> Z10  {O-ԍXxSee also MFSI Application for a License to Land and Operate in the United States a Common Carrier TransPacific Submarine Telecommunications Cable Extending Between the United States and Australia/New Zealand, SCL97005 at 10 (filed Oct. 10, 1997).(#>  X -x5.` ` CTS, a California corporation, is an authorized U.S. international facilities X -based and resale carrier.  R  yO-ԍXxApplication of CTS to Resell IPLs Interconnected to the PSN to Provide Switched Services Between the United States and Australia and Sweden, ITC95116 at 23 (filed Dec. 28, 1994) ("CTS Application").(# CTS indirectly owns and controls WorldxChange Pty Ltd, an  X -Australian corporation.   yO0-ԍXxLetter from Robert E. Conn, Attorney for CTS to William J. Caton, Acting Secretary, FCC (Sept. 15, 1995).(#Ƣ  X -x6.` ` INTEX and CCI are both U.S. corporations. INTEX is authorized to resell the international switched services of other authorized carriers, and to use this authority to provide international switched voice and data services from the United States to various international"y 0*%%II"  X-points.:  yOy-ԍXxApplication of INTEX to Resell IPLs for the Provision of Switched Services Between the United States and Australia, ITC95185 at 2 (filed Feb. 8, 1995) ("INTEX Application"). INTEX is a whollyowned subsidiary of TresCom International, Inc. ("TresCom"). Letter from Wendy I. Kirchick, Counsel for INTEX, Kelley Drye & Warren, LLP to Troy Tanner, Chief, Policy and Facilities Branch,  {O-Telecommunications Division, International Bureau, FCC, ITC95185 (July 31, 1997) ("INTEX Letter"). (#: CCI is authorized to resell the services of other carriers for the provision of international switched telecommunications services between the United States and various  X-international points.* Xz yO-ԍXxApplication of CCI for Authority to Operate as an International Common Carrier Reselling Private Lines to Offer Switched Services Between the United States and Australia, File No. ITC96182 at 12 (filed March 12, 1996) ("CCI Application").(#*  X-x7.` ` TI, a Delaware corporation, is affiliated with several foreign carriers. TI is an indirect whollyowned subsidiary of Telstra Corporation Limited ("Telstra"), which is 100  Xv-percent owned by the Commonwealth of Australia and provides local and longdistance  X_-service in Australia.qX_ yO-ԍXxTI Application to Resell International Message Telephone Services, IPL Services Not Interconnected to  yOr-the PSN and IPLs Interconnected to the PSN all for the provision of service between the United States and Australia, File No. ITC96319 (filed June 10, 1996) ("TI Application").(#q TI is authorized to resell certain international telecommunications  XH-services to various international points, excluding Australia.vj H  {O-ԍXxSee e.g., Overseas Common Carrier Section 214 Application Actions Taken, Public Notice, Report No. I8987, DA 961410 (1996) (resale of interconnected IPLs to the United Kingdom, Canada, and  {OE-Sweden); Telstra, Inc., Order and Authorization, 11 FCC Rcd 20428 (Int'l Bur., 1996) (resale of international message telephone service ("IMTS") and noninterconnected IPLs Between the United States and various international points, excluding Australia). In addition, TI has a pending application  {O-to provide facilitiesbased service on the U.S.Australia route. See TI Application for Section 214 Authority to Acquire Capacity in Any International Facilities for the Provision of IMTS and Switched  {O1-and Private Line Services Between the United States and Australia, ITC97320 (June 10, 1997) ("TI  {O-Facilitiesbased Application"). We note that TI's facilitiesbased application is attached to an ex parte  yO-filing by TI. Letter from Gregory C. Staple, Counsel for TI, to Joanna Lowry, Int'l Bur., FCC (July 7, 1997). Because the issues raised by TI's application are substantially similar to those raised by TI's facilitiesbased application, we incorporate by reference the record in the latter proceeding.(#v  X -Xx B.X` ` The Pleadings (#`  X -x8.` ` MFSI, CCI, and INTEX seek authority to resell IPLs interconnected to the PSN at one or both ends to provide switched services between the United States and Australia. CWI, GNI, and CTS seek authority to resell IPLs interconnected to the PSN at both ends to provide switched services between the United States and Australia. "0*%%II"Ԍ X-x9.` ` TI seeks authority to resell: (1) IPLs of unaffiliated carriers interconnected to the PSN at one or both ends to provide switched services; (2) switched services of unaffiliated carriers ("switched resale"); and (3) IPLs of unaffiliated carriers not interconnected to the PSN  X-to provide switched services ("noninterconnected private line resale") all between the United States and Australia.  Xv-x 10.` ` As required by the Commission's rules,Tv yO-ԍXx47 C.F.R.  63.18(e)(3).(#T the applicants submitted information and documentation to demonstrate that Australia offers U.S.based carriers equivalent resale  XH-opportunities in Australia. TI also submitted information that, on balance, Australia provides U.S. carriers effective competitive opportunities to provide switched resale and noninterconnected private line resale. We placed each of the applications on public notice.  X -x 11.` ` AT&T Corp. ("AT&T") filed petitions to deny for all the applications, to which  X -each applicant replied. X {O-ԍXx See AT&T Petition to Deny TI, ITC96319 (July 24, 1996) ("AT&T Petition to Deny TI"); AT&T Petition to Deny CCI, ITC96182 (Apr. 22, 1996); AT&T Petition to Deny INTEX, ITC95185 (Mar.  yOp-27, 1995); AT&T Petition to Deny CTS, ITC95116 (Feb. 6, 1995) ; AT&T Petition to Deny MFSI, ITC95015 (Nov. 18, 1994); AT&T Petition to Deny GTI, ITC94435 (Sep. 16, 1994); AT&T Petition  {O-to Deny CWI, ITC93328 (Oct. 22, 1993) (collectively, "AT&T Petitions to Deny"). See also TI  {O-Opposition to Petition to Deny and Reply to Comments, ITC96319 (Aug. 26, 1996) ("TI Opposition"); CCI Opposition to AT&T's Petition to Deny, ITC96182 (May 29, 1996); INTEX Opposition to AT&T's Petition to Deny, ITC95185 (Apr. 10, 1995); CTS Opposition to AT&T's Petition to Deny, ITC95116 (Feb. 28, 1995); MFSI Opposition to AT&T's Petition to Deny, ITC95015 (Dec. 1, 1994); GTI Opposition to AT&T's Petition to Deny, ITC94435 (Sept. 29, 1994); CWI Reply Comments and  {O-Opposition to Petitions to Deny, ITC93328 (Nov. 4, 1993) ("CWI Reply Comments"). (#CWI REPLYTI OPPOSITION AT&T filed replies to all the applicants' replies.  {OF-ԍXxSee AT&T Reply to the Opposition of TI, ITC96319 (Sept. 12, 1996) ("AT&T 1996 Reply to TI");  yO-AT&T Reply to Opposition of CCI, ITC96182 (June 10, 1996); AT&T Reply to Opposition of  yO-INTEX, ITC95185 (Apr. 24, 1995); AT&T Reply to Opposition of CTS, ITC95116 (Mar. 10, 1995) ; AT&T Reply to Opposition of MFSI, ITC95015 (Jan. 17, 1995); AT&T Reply to Opposition of GTI, ITC94435 (Oct. 12, 1994); AT&T Reply to Opposition of CWI and FGC, Inc., ITC93328 (Nov. 16,  yO0-1993) . (# In addition,  X -Sprint Communications Company L.P. ("Sprint") filed a petition to deny in part against CWI,  X -to which CWI replied. : {O -ԍXxSprint Petition to Deny in Part, ITC93328 (Oct. 22, 1993) ("Sprint Petition to Deny CWI"); CWI Reply  {O\!-Comments at note CWI REPLY17.(# Sprint also filed a reply to CWI's opposition.y  {O"-ԍXxSprint Reply, ITC93328 (Nov. 17, 1993) ("Sprint Reply").(#y "(0*%%IIj"Ԍ X-x 12.` ` FGC, Inc. ("FGC") filed comments supporting CWI's application as well as  X-reply comments in response to AT&T's petition to deny and Sprint's petition to deny in  X-part. yOK-ԍXxComments of FGC, Inc., ITC93328 (Oct. 22, 1993); Reply Comments of FGC, Inc., ITC93328 (Nov. 1, 1993).(#ƣ IDB, Inc. ("IDB") also filed comments in response to CWI's application.  yO-ԍXxIDB did not oppose CWI's application. IDB states, however, that CWI should not be subject to the Commission's equivalency requirement because it applies only to international private line resale. IDB asserts that CWI's application should be treated as a request for authority to operate as a facilitiesbased carrier because CWI's application states that CWI proposes to lease the underlying transmission facilities from U.S. carriers. Letter from Robert S. Koppel, Vice President, Legal and Regulatory Affairs, IDB to William F. Caton, Acting Secretary, FCC (Oct. 22, 1993). Subsequently, CWI clarified that it proposed  yOS -to resell the international private line services of AT&T, MCI, Sprint, and IDB pursuant to the filed and effective FCC tariffs of those carriers, and/or pursuant to negotiated contracts with authorized  {O -international carriers. See Letter from Charles A. Tievsky, Senior Regulatory Attorney, CWI, to  yO -Jennifer Warren, FCC (Jul. 27, 1994). CWI's application is thus considered a request to resell service and is subject to the Commission's equivalency requirement. (# MCI filed  X-comments in the TI proceeding to which TI replied.i"  {O-ԍXxMCI Comments, ITC96319 (July 25, 1996) ("MCI Comments"); TI Opposition. PanAmSat Corporation also filed late comments and reply comments that it subsequently withdrew. Letter from Joseph A. Godles, Attorney for PanAmSat Corporation to William Caton, Acting Secretary, FCC (July 18, 1997).(#i In addition, numerous ex parte filings were made.  Xx-x 13.` ` On July 8, 1997, pursuant to Section 1.65 of the Commission's rules we sent a letter to each of the parties requesting that they provide us with any additional or corrected  XJ-information in light of recent changes in the Australian regulatory regime. Jl yOg-ԍXxOn July 8, 1997, Troy Tanner, Chief, Policy and Facilities Branch, Telecommunications Division, International Bureau, FCC, sent a letter to all the parties requesting any additional information on the new Australian regime. Copies of these letters are available in the International Bureau's reference room, 2000 M Street, N.W., Washington, DC, 20554. (#ƚ AT&T, TI,  X3-INTEX, CCI, CTS, and CWI provided additional information.3T {O8-ԍXxAT&T Reply to Supplemental Information, ITC96319 (Aug. 14, 1997) ("AT&T 1997 Reply"); Letter from Gregory C. Staple, Counsel for TI, to Troy F. Tanner, Chief, Policy and Facilities Branch,  {O-Telecommunications Division, Int'l Bur., FCC (Aug. 8, 1997) ("TI Aug. 8 Letter"); INTEX Letter, supra  {O -note 12; CCI Amendment to Application, ITC 96182 (July 31, 1997) ("CCI Amendment"); CTS Second  {O^!-Report to Update the Record, ITC95116 (July 31, 1997) ("CTS Second Update"); CWI Statement of  {O("-Additional Information, ITC93328 (July 31, 1997) ("CWI Additional Information"). (#AUG 8 LETTER " 0*%%II# "  X-Xx C.X` ` General Changes in the Australian Telecommunications Regime (#`  X-x 14.` ` Australia's telecommunications market has undergone significant change in the  X-past several years. Before 1988, telecommunications services in Australia were provided by carriers with monopolies in their respective areas of operation. The Australian Telecommunications Corporation ("ATC") provided most telecommunications services within Australia. The Overseas Telecommunications Corporation ("OTC") provided overseas services and facilities. A third publiclyowned carrier, AUSSAT Proprietary Ltd. ("AUSSAT")  XH-established and operated the domestic satellite system.RH yO -ԍXxMFSI Application at 810.(#R  X -x15.` ` In 1989, the Australian Government established the Australian Telecommunications Authority ("AUSTEL") as an independent regulator of the telecommunications industry. AUSTEL's functions included issuing class licenses to service providers and promoting competition and fair market conduct. In 1990, the Australian Government enacted the AUSSAT Amendment Act which authorized AUSSAT to compete directly with ATC and OTC. Subsequently, ATC and OTC merged into a single corporation  X-now operating as Telstra.bX {O-ԍXxId. at 9; CWI Application at 1416.(#b  Xb-x16.` ` In 1991, AUSSAT was sold to a consortium (which included Cable & Wireless, plc) and now provides domestic and international telecommunications services as Optus. Pursuant to the Telecommunications Act 1991 ("1991 Act"), Optus was authorized to compete  X-as a facilitiesbased carrier with Telstra in the Australian domestic and international sectors.N yO-ԍXxCTS Application at 7.(#N The 1991 Act also affirmed the role of AUSTEL as Australia's telecommunications regulator,  X-with policy set by the Ministry of Communications and the Arts._z {O-ԍXxId. at 7; CWI Application at 15.(#_  X-x17.` ` On July 1, 1997, Australia implemented new telecommunications laws (11 bills in all) that restructured the Australian telecommunications market and the administrative agencies that regulate the industry. According to the Australian Government, the main objective of the new regime is to provide a regulatory framework that promotes the longterm interests of consumers, and promotes the efficiency and international competitiveness of  XN-Australia's telecommunications industry.N  {O $-ԍXxCTS Second Update at Attachment 1 (Australian Department of Communications and the Arts, Overview  {O$-of Australian Open Telecommunications Market (July 1997) ("Australian Overview")).(# The core of the new regime is the"Nh 0*%%II" Telecommunications Act 1997 ("1997 Act"), which deals with licensing, carrier and service  X-provider rules, consumer measures, and technical regulation.>F {Ob-ԍXxId. at 1; CWI Additional Information at 3. Other relevant pieces of legislation for our analysis are the: (1) Trade Practices Act 1974 amended by the Trade Practices Amendment (Telecommunications) Act 1997 ("Trade Practices Amendment"), which establishes rules on anticompetitive conduct, recordkeeping, and access; (2) Australian Communications Authority Act 1997 ("ACA Act"), which establishes the functions and powers of the new telecommunications regulator; and (3) Telecommunications (Transitional Provisions and Consequential Amendments) Act of 1997, which  {O-enacts transitional amendments in connection with the 1997 Act. For texts of the various laws see CTS  {O-Second Update, Vols. I and II.(#>  X- III. DISCUSSION ă  X-x18.` ` In Part A of this Section, we analyze the applications for authority to provide switched service over resold private lines interconnected to the public switched network. In Part B we analyze TI's application to provide international service via switched resale and resale of noninterconnected private lines. In Part C we look at additional public interest factors for all types of resale and in Part D we look at other matters addressed by the parties.  X - A.XxEquivalency Analysis (#  X -x19.` ` The Commission's rules require that applicants seeking to provide switched service over resold private lines demonstrate that the foreign country at the other end of the private line provides U.S. carriers with: (1) the legal right to resell IPLs interconnected to the PSN at both ends, for the provision of switched services; (2) reasonable and nondiscriminatory charges, terms, and conditions for interconnection to foreign carrier domestic facilities for termination and origination of international services, with adequate means of enforcement; (3) competitive safeguards to protect against anticompetitive and discriminatory practices affecting private line resale; and (4) fair and transparent regulatory procedures, including separation between the regulator and the operator of international  X-facilities-based services.k  {O-ԍXxSee Market Entry and Regulation of Foreignaffiliated Entities, Report and Order, 11 FCC Rcd 3873  {OW-(1995), ("Foreign Carrier Entry Order"), recon. granted in part, denied in part, and deferred in part in In the Matter of Rules and Policies on Foreign Participation in the U.S. Telecommunications Market,  {O-Market Entry and Regulation of ForeignAffiliated Entities, Report and Order and Order on  {O -Reconsideration, IB Docket Nos. 97142, 9522, FCC No. 97398 (rel. Nov. 26, 1997) ("Foreign  {O}!-Participation Order").  See also Communications TeleSystems International, Memorandum Opinion,  {OG"-Order and Certification, 11 FCC Rcd 17471, 1747317474 (Int'l Bur., 1996), recon. pending ("New  {O#-Zealand Equivalency Order"). The Commission has recently adopted new rules eliminating the equivalency requirement for applications to provide switched services via resold private lines between the United States and World Trade Organization ("WTO") Members, but these rules are not yet in"$0*%%$"  {O-effect. Foreign Participation Order at  197. (#k NO EQUIV FPN These four principles must be satisfied at the time we make an"Z 0*%%IIt" equivalency determination. Additionally, we examine other public interest factors that may  X-warrant grant or denial of the application.!Z yO-ԍXxTo date, the Commission has found that Canada, the United Kingdom, Sweden, and New Zealand offer U.S.based carriers equivalent opportunities for the resale of IPLs for the provision of switched services.  {O-See fONOROLA Corp. and EMI Communications Corp., Memorandum Opinion, Order and  {ON-Certification, 7 FCC Rcd 7312 (1992) (Canada), on recon., 9 FCC Rcd 4066 (1994); ACC Global Corp.  {O-and Alanna Inc., Memorandum Opinion, Order and Certification, 9 FCC Rcd 6240 (1994) (United  {O-Kingdom); Cable & Wireless, Inc. et. al, Memorandum Opinion, Order and Certification, 11 FCC Rcd  {O -1766 (Int'l Bur., 1996) (Sweden); New Zealand Equivalency Order; Telecom New Zealand, Order,  {Ov -Authorization, and Certificate, File No. ITC97049, DA 972133 (Int'l Bur., rel. Oct. 6, 1997) (granting Telecom New Zealand Limited authority to resell international private lines interconnected to  yO -the PSN for the provision of telecommunications services between the United States and New Zealand). (#  X-Xx 1.X` ` Resale Entry (#`  X-x20.` ` The first factor in our equivalency analysis is whether there are any legal restrictions on U.S. carriers' ability to resell international private lines, interconnected to the PSN at both ends, for the provision of switched services.  X1-x21.` ` No party disputes that foreign carriers have the legal right to provide resale services in Australia. The record indicates there are no restrictions on foreign ownership of  X -telecommunications resellers in the Australian resale market.~"  {O-ԍXxCTS Second Update at 2; CCI Amendment at 2. (#~ Also, although facilitiesbased  X -carriers are required to obtain licenses, "carriage service" (or resale) providers are not.=#  yO--ԍXxThe 1997 Act regulates two categories of telecommunications service providers: (1) "carriers," which are comparable to the FCC's facilitiesbased carriers; and (2) "carriage service providers," which are  {O-equivalent to the FCC's resale carriers. CTS Second Update at 4; CWI Additional Information at 23. A carrier must hold a license under the 1997 Act but no license is required for a carriage service  {OO-provider. CTS Second Update at 4. (#=  X -Moreover, no restrictions exist on the number of licenses that may be issued.N$ D {O-ԍXxId.(#N  X -x22.` ` The only law on foreign investment is the Foreign Acquisition and Takeovers  X-Act, which imposes a national interest test on certain foreign investments.M%X yO#-ԍXxService sector investments by foreign investors involving total investments of A $10 million or more, and proposals to acquire existing businesses with total assets of A $5 million or more (the threshold is lower for certain acquisitions that include land) are subject to review by the Foreign Investment Review"$$0*%%$" Board ("FIRB"). The review process requires a written submission describing the investment to the federal Treasurer, with a copy to the FIRB. The investor need not demonstrate economic benefit or provide for Australian equity participation. Applications are approved unless judged contrary to the national interest. The investment may proceed in the event of agency inaction. MFSI Application at  yO-15, n.35.(#M Consistent with" x%0*%%II" precedent, we find that the national interest test is not a significant bar to U.S. carriers' entry  X-into the resale market in Australia.N&Zx {O-ԍXxSee MAP, Mobile Communications, Inc., Order, 12 FCC Rcd 6109, 6114 (Int'l Bur., 1997) (finding that the Foreign Acquisitions and Takeovers Act is not a significant bar to U.S. carriers' entry into the  yO -mobile services market in Australia). (#N  X-x23.` ` In addition, the legal openness of the Australian market is illustrated by the fact that a number of U.S. carriers, or their Australian affiliates, have entered the Australian market to resell international private lines interconnected to the PSN at both ends for the provision of switched services. WorldxChange, a majorityowned affiliate of the U.S. carrier CTS, has domestic and international resale operations with multiple switches and points of presence in Sydney, Melbourne, Brisbane, Gold Coast, and Perth. In addition to WorldxChange other resellers, most with significant foreign (including U.S.) ownership include: AAPT Limited, AT&T Communications Services Australia Pty Ltd., Global One Communications Pty Ltd., Axicorp, RSL COM Australia Pty Ltd., Spectrum Global  X -Telecommunications Pty Ltd., and Telegroup Network Services Pty. Ltd.N'  {O7-ԍXxId. at 2.(#N  X -x24.` ` Based on the presence of U.S. carriers in the Australian market and the absence of meaningful restrictions on foreign ownership, we conclude that Australia affords open entry for U.S.based carriers.  Xb-Xx 2.X` ` Interconnection (#`  X4-x25.` ` The second factor we examine is whether U.S. carriers are able to obtain interconnection to a foreign carrier's domestic facilities in Australia for termination and origination of international services at reasonable and nondiscriminatory charges, terms, and" , '0*%%II"  X-conditions.K(D yOy-ԍXxFor purposes of this Order, the term "interconnection" means the ability of carriers to interconnect to a foreign carrier's domestic facilities for termination and origination of international services. We also consider whether U.S. carriers have access to intercity services as relevant to whether interconnection is  {O-available on nondiscriminatory charges, terms and conditions. Foreign Carrier Entry Order, 11 FCC  {O-Rcd at 38923893. Cf. 47 U.S.C.  251(c)(2) (imposing a "duty to provide, for the facilities and equipment of any requesting telecommunications carrier, interconnection with the local exchange carrier's network (A) for the transmission and routing of telephone exchange service and exchange access . . . .").(#K In addition, there must be adequate means to monitor and enforce these  X-conditions.x) {On -ԍXxSee Foreign Carrier Entry Order, 11 FCC Rcd at 389293. (#x  X-x26.` ` Under the 1997 Act, both carriers and carriage service providers must provide their competitors access to, and interconnection with "declared services" as defined by the  X-Australian Competition and Consumer Commission ("ACCC").y*f  yO-ԍXxFor a description of the ACCC see  ACCC DESCRIP45.(#y The ACCC's list of  Xv-"declared services" include local origination and termination services.+v  {O-ԍXxTI Opposition to AT&T Petition to Deny, ITC97320 at ii (Aug. 4, 1997) ("TI's Facilitiesbased  {O-Opposition to AT&T"). We note that TI's Facilitiesbased Opposition to AT&T is appended to an ex  {O-parte filing in this proceeding. TI Aug. 8 Letter, supra note AUG 8 LETTER25. TI also states that the list of "declared services" covers the core access services provided under the preexisting access arrangements between  {OC-Australia's three facilitiesbased carriers (Telstra, Optus, and Vodaphone). Id. at 7.(#Ɩ The 1997 Act also requires that "declared services" be provided subject to certain "standard access obligations" in  XH-relation to that service.,H yO-ԍXxGenerally, subject to limitations regarding the reasonable requirements of existing users, these include obligations (where requested by a service provider) to: (1) supply the declared service at a technical and operational quality equivalent to that which it supplies itself; (2) permit interconnection of facilities to enable a service provider to be supplied with the declared service at a technical and operational quality equivalent to that which it provides interconnection to itself; (3) provide billing information associated with the declared service; and (4) if the declared service is supplied by means of conditional access customer equipment, supply services necessary to enable the service provider to supply carriage  {O-or content services by means of the declared service using the equipment. CTS Second Update at 67;  {O-TI's Facilitiesbased Opposition to AT&T at 6; TI Aug. 8 Letter, TI's Facilitiesbased Opposition to  {O-AT&T, Attachment 5, Department of Communications and the Arts, Australia's Open  {O} -Telecommunications Market: the new framework at 27 ("TI Attachment 5"). (# No party disputes that the "standard access obligations" are sufficient for interconnection.  X -x27.` ` Interconnection Prices. AT&T argues, however, that under the new regime U.S. carriers cannot obtain reasonable, nondiscriminatory prices, terms, and conditions for" ,0*%%II" "  X-interconnection to Telstra's network.d-  {Oy-ԍXxSee e.g., AT&T 1997 Reply at 25; Letter from Mary M. Hoberman, District Manager Law and Public  {OC-Policy, AT&T, to William F. Caton, Acting Secretary, FCC (Nov. 5, 1997) ("AT&T Nov. 5 Letter").  {O -When these applications were first filed (i.e., prior to the 1997 Act), AT&T and Sprint argued that Australia did not satisfy our equivalency requirement for nondiscriminatory charges, terms and  {O-conditions for interconnection. AT&T Petitions to Deny; Sprint Petition to Deny CWI at 1112. After the implementation of the new regime, however, AT&T does not oppose a finding that would permit all the applicants other than TI to resell IPLs interconnected to the PSN. AT&T Reply to Supplemental Information at 3. Because AT&T no longer objects to a finding of equivalency for Australia, we will limit our discussion of AT&T's concerns to those it recently articulated in response to TI's application. Sprint has not filed any comments since the implementation of the new regime. Accordingly, we will address Sprint's arguments as relevant to the new regime. AT&T also argues in its petition to deny TI's facilitiesbased application that the new law in Australia relies on an industry forum to selfregulate  {O -interconnection arrangements. AT&T Petition to Deny, ITC97320 at 7 (July 16, 1997) ("AT&T  {O -Petition to Deny TI's Facilitiesbased Application"). We will address this argument when we rule on TI's facilitiesbased application.(#d AT&T asserts that, while Telstra currently is required to provide standard interconnection prices to its domestic network, this requirement is temporary and applies only to six cities (Sydney, Melbourne, Perth, Canberra, and other state capitals). Thus, AT&T argues that Telstra, with its "high degree of market power," has the  X-ability to maintain abovecost interconnection rates to all other sections of Australia.X.T  {O-ԍXxAT&T 1997 Reply at 45. (#X AT&T states that TI should not be allowed entry into the U.S. market until Telstra provides cost Xv-based interconnection at all of its bottleneck facilities (i.e., other sections of Australia, the  Xa-international gateway point, and the midocean settlement point).f/Za {O-ԍXxSee e.g., AT&T 1997 Reply at 5. AT&T's argument regarding costbased interconnection rates at the midocean settlement point appears to be an argument about Telstra's accounting rate. We discuss our accounting rate policies in Part C, "Additional Public Interest Factors," below. (#f  X3-x28.` ` We do not agree that Australia condones unreasonable interconnection prices. Telstra's current prices appear reasonable for interconnection for originating or terminating switched access in the six Australian cities. We find that the rate of approximately A $.0284 (U.S. $0.02) per minute during peak periods and approximately A $.0134 (U.S.  X -$0.01) offpeak compare favorably with rates in New Zealand and the United States.0$  {O-ԍXxTI Facilitiesbased Opposition to AT&T at i, 7; TI Aug. 8 Letter at 2; CCI Amendment at 3. See e.g.,  {OZ -New Zealand Equivalency Order, 11 FCC Rcd at 1747917480 (stating that TNZL's principal interconnection contract establishes that rates for interconnection of all toll traffic to TNZL's local network are approximately U.S. $0.02 during peak periods, and U.S. $0.01 offpeak).(#  X -x29.` ` Moreover, we are not persuaded that these rates are limited either in scope or duration for several reasons. First, although the current interconnection prices are only" 00*%%II" guaranteed until January 1998, the ACCC has the power to continue to require Telstra to provide interconnection at these prices beyond January 1998. Moreover, the ACCC has adopted access pricing principles that use total service longrun incremental cost ("TSLRIC")  X- to measure the appropriateness of an interconnection price.`1 {O4-ԍXxACCC, "Access Pricing Principles Telecommunications" (July 1997) ("ACCC Pricing Principles") (TI  {O-Aug. 8 Letter, Attachment 8). "TSLRIC is the forwardlooking incremental cost of supplying the whole service when the other activities of the firm remain unchanged. It includes the costs an efficient firm would necessarily incur in providing the service, or alternatively the costs that would be avoided if the  {OX-service was no longer provided in the long run." ACCC Pricing Principles at 29.(#` The ACCC will use this guide to review service providers' access undertakings and in the arbitration of interconnection disputes (both discussed below). Second, even though the ACCC's interim prices apply only to six cities, TI estimates that at least 80 percent of international calls originate in these six  X_-cities, and AT&T does not dispute TI's estimation.n2_~ {O -ԍXxTI's Facilitiesbased Opposition to AT&T at 7. (#n  X1-x30.` ` We also find that AT&T has not provided sufficient information to support its claim that interconnection at the international gateway point is not available on a reasonable  X -and nondiscriminatory basis. As discussed more fully below,X3  {O-ԍXxSee  52, infra.(#X Optus has built switching facilities in major Australian markets, assembled fiber optic cable links between these facilities, built intercity "fiber rings" in central business districts of several cities, and constructed a fiber optic network in several major cities. We find that this buildout by Optus combined with Telstra's current prices for originating or terminating switched access provide sufficient ability for U.S. carriers to obtain access to existing facilities to originate or terminate international traffic at reasonable and nondiscriminatory rates between the United  Xb-States and Australia.N4\b yO-ԍXxWe also note that AT&T, in opposing TI's facilitiesbased application, does not dispute the legal ability  {O}-of facilitiesbased carriers to enter the Australian market. AT&T Petition to Deny TI's Facilitiesbased  {OG-Application at 45.(#N Accordingly, we do not find sufficient basis to conclude that U.S. carriers are unable to obtain reasonable and nondiscriminatory interconnection rates for the origination and termination of international traffic in Australia.  X-x31.` ` Publication of Interconnection Agreements. AT&T also argues that Telstra,  X-through private negotiations, is able to engage in "secret interconnection rate deals."Y5&  {Of"-ԍXxAT&T 1997 Reply. CTS notes that the ACCC can direct carriers and carriage service providers to file tariff information with the ACCC. Also, Telstra must file tariffs for its basic carriage services unless  {O#-the ACCC has exempted Telstra. CTS Second Update at 5. Tariff information is only made publicly  {O$-available, however, if the ACCC believes that publication would result in a "net public benefit." TI"$40*%%$"  {O-Attachment 5 at 22.(#Y " Z50*%%II" Specifically, AT&T argues that Australia's regime permits carriers to reach voluntary  X-interconnection agreements that do not have to be published.y6Z yO-ԍXxAT&T concedes that Telstra may have to publish interconnection agreements resulting from an access undertaking (which includes model terms and conditions for access to declared telecommunications services) or from an arbitration (which happens in the event that parties are unable to agree to a commercially negotiated interconnection agreement). AT&T Reply to Opposition to Petition to Deny,  {O-ITC97320 at 67 (Aug. 14, 1997) ("AT&T Reply to TI's Opposition to AT&T's Petition to Deny TI's  {O-Facilitiesbased Application"). (#y Such lack of publication, AT&T argues, places a new entrant at a competitive disadvantage because new entrants will not know what interconnection arrangements have been brokered by Telstra with other  X-carriers.W7 {O+ -ԍXxAT&T Nov. 5 Letter at 2.(#W AT&T also argues that in every previous equivalency order the incumbent carrier in the foreign market either provided a standard interconnection agreement that included the prices, terms, and conditions or the incumbent carrier published its interconnection  X_-agreements.Y8_h  {Ox-ԍXxAT&T Nov. 5 Letter at 34.(#Y  X1-x32.` ` As a general policy, publication of all interconnection agreements reached voluntarily by the parties is necessary to ensure that competitors are able to obtain  X -interconnection at nondiscriminatory rates.9"  {O-ԍXxSee e.g., Telia North America, Inc., Order, Authorization and Certificate, ITC96545, DA 97511  24 (Int'l Bur., rel. Mar. 11, 1997) (expressing concern that because there is no legal requirement that Telia NA publish its interconnection arrangements, U.S. carriers could not be assured that Telia NA provides  yO-nondiscriminatory rates in compliance with its published price list). (# Thus, we are concerned about the lack of publication of commercially negotiated interconnection agreements. Despite the lack of publication of voluntary agreements, however, we find that other aspects of Australia's  X -interconnection regime discussed above (i.e., the current interconnection prices, the ACCC's ability to require continuation of those prices, and the ACCC's pricing principles), help protect against discriminatory conduct and weigh in favor of finding that Australia satisfies this factor of our equivalency standard.  XM-x 33.` ` In addition, the ACCC has a role in overseeing interconnection and ensuring nondiscriminatory treatment of competitors. The ACCC has broad powers to require any  X-information that is relevant to the performance of its functions.a: {O#-ԍXxCWI Additional Information at 45.(#a If, for example, an interconnection negotiation breaks down or a dispute arises during the course of an"v:0*%%II" interconnection negotiation, either side may notify the ACCC that a dispute exists. The ACCC has the power to determine the terms and conditions of access. The ACCC's  X-determination may deal with any matter relating to access.E; {OK-ԍXxCTS Second Update at 7; Id. Attachment 2, Clayton Utz Solicitors and Attorneys and Australian  {O-Telecommunications Users Group Limited, Providing Telecommunications Services in Australia: A  {O-Guide to the Post July '97 Regime at 25 ("CTS Law Firm Guide"). ACCC determinations are subject to review by the Australian Competition Tribunal ("Tribunal"). The decisions and proceedings of the Tribunal are subject to judicial review by the Federal Court.(#E The ACCC will use its pricing  X-principles (i.e., TSLRIC) as a guide in the arbitration of interconnection disputes.^<~ {O -ԍXxACCC Pricing Principles at 12.(#^  X-x!34.` ` Also, the ACCC approves all access undertakings, which include model terms and conditions for access to a declared service, that are submitted by the parties. The  Xa-ACCC's pricing principles (i.e., TSLRIC) apply to all access undertakings approved by the ACCC. If accepted by the ACCC, an access undertaking conclusively determines the terms  X5-and conditions of access to which that undertaking relates.<=Z5 yO-ԍXxAccess undertakings, however, need not address all the terms and conditions of access. If an access undertaking does not deal with a particular matter, it may be resolved either by negotiation or  {O-arbitration. TI Attachment 5 at 28.(#<  X -x"35.` ` Given these aspects of Australia's interconnection regime, at present, we conclude that Australia satisfies the interconnection factor of our equivalency test. If the parties submit information that the lack of publication is resulting in discriminatory practices or if we otherwise determine that market conditions develop in Australia such that interconnected IPL resale is not commercially viable, we will revisit our findings in this proceeding.  Xf-Xx 3.X` ` Competitive Safeguards (#`  X8-x#36.` ` The third factor we examine is whether safeguards exist in the foreign country to protect against anticompetitive practices. The safeguards we consider important include: (1) existence of costallocation rules to prevent crosssubsidization; (2) timely and nondiscriminatory disclosure of technical information needed to use, or interconnect with,  X-carriers' facilities; and (3) protection of carrier and customer proprietary information.o>2  {O!-ԍXxForeign Carrier Entry Order, 11 FCC Rcd at 3893.(#o  X- " >0*%%IIR"  X-XxX` ` a.X Cost Allocation Rules (#  X-x$37.` ` We first examine whether Australia has cost allocation rules in place to protect against crosssubsidization. No party disputes the adequacy of the competitive safeguards that exist in Australia. Under the 1991 Act, Chart of Accounts/Cost Allocation rules apply to all  X-carriers.U? {O-ԍXxTI Opposition at n.29.(#U These rules establish how carriers allocate costs to the various parts of their businesses; require regular reporting of cost information to the ACCC; and provide the ACCC with an oversight of costs of the carriers' different business activities. These rules will  XH-continue in force until new recordkeeping rules are developed by the ACCC.e@HZ {OS -ԍXxTI Facilitiesbased Application at 14.(#e In addition, as discussed below, the ACCC has the power to take action against carriers or carriage service providers who engage in anticompetitive conduct. Given the rules that are in place and the lack of evidence to the contrary in the record, we find that cost allocation rules exist in Australia to protect against crosssubsidization.  X -XxX` ` b. Disclosure of Network Information (#`  X-x%38.` ` We next address whether competitive safeguards exist in Australia to ensure disclosure of network information required for interconnection. There is no evidence in the record that carriers are not receiving the technical network information necessary to interconnect with Telstra or Optus. A standard condition in carrier licenses, including Telstra's, requires a carrier to provide all other carriers with information about the operation  X-of their network in a timely manner.A {O-ԍXxTI Facilitiesbased Application at 15 (citing Telecommunications Act 1997, Schedule 1, Part 4).(#Ƥ The obligations apply to traffic patterns, call routing arrangements, network planning information, notification of likely changes to facilities, and quality of service information. Given the standard condition and lack of specific evidence to the contrary, we find that there are adequate requirements in Australia to ensure that carriers receive the technical information required for interconnection.  X-XxX` ` c.X Safeguards for Carrier and Customer Proprietary Information (#  Xe-x&39.` ` The final competitive safeguard we examine is whether carrier and customer proprietary information is protected in Australia. Section 88 of the 1991 Act bars carriers from disclosing proprietary customer information that may be furnished to a carrier in the course of providing service. Violation of this section could subject a person to civil and" ~A0*%%IIz"  X-criminal penalties.SB {Oy-ԍXxTI Opposition at 12.(#S The protections that existed under the 1991 Act were continued and  X-reinforced in the 1997 Act.CZ {O-ԍXxLetter from Gregory C. Staple, counsel for TI, to Joanna Lowry, FCC, 12 (Oct. 14, 1997) ("TI Oct. 14  {O-Letter"). (# Specifically, Section 276 of the 1997 Act prohibits carriers,  X-carriage service providers (i.e., resellers) and their employees and contractors from disclosing or using information relating to carriage services supplied to another person or the affairs or  X-"personal particulars" of another person.DZ {O -ԍXxTI Oct. 14 Letter at 2. Section 279 allows for exceptions to this rule, in the case of employees and contractors of carriers and resellers, only when those employees and contractors are engaged in their official duties.(#  Xx-x'40.` ` In addition, Telstra is subject to Australia's Privacy Act 1988 which limits the  Xa-extent to which Telstra may disclose customer information that it has obtained. Telstra also  XJ-has a corporate policy regarding confidentiality that is broader than the 1997 Act.EJ yO-ԍXxTelstra's July 1996 "Code of Conduct" requires that customer information only be used for: (1) a lawful purpose for which it was collected; (2) improvement of customer service; (3) derivation of anonymous or aggregated information; (4) the prevention or lessening of a threat to the life or health of the person concerned or another person; (5) purposes permitted, required, or authorized by law; (6) the enforcement of criminal law, a law imposing a pecuniary penalty, or for protection of public revenue; or  {O-(7) any other purpose where the person concerned has consented. TI Oct. 14 Letter at 2. (#ƫ Telstra has confidentiality agreements with current large enduser customers as well as provisions in its existing interconnection agreements with Optus and Vodafone. Telstra states it expects to incorporate such confidentiality undertakings into agreements with new interconnecting service  X -providers.WF R  {O-ԍXxTI Oct. 14 Letter at 2. (#W  X -x(41.` ` In sum, we find that the competitive safeguards implemented in Australia are sufficient to protect U.S. carriers against anticompetitive practices, and to ensure proper cost allocation, timely and nondiscriminatory disclosure of network technical information, and protection of carrier and customer proprietary information against unauthorized disclosure.  XM-Xx 4.X` ` Regulatory Framework (#`  X-x)42.` ` The fourth factor we review is whether there is an effective regulatory framework in Australia to develop, implement, and enforce legal requirements, interconnection arrangements, and other competitive safeguards. The focus of this factor is on whether there is separation between the foreign regulator and the operator of international"F0*%%II" facilitiesbased services, and whether there are fair and transparent regulatory procedures in  X-the destination market.oG {Ob-ԍXxForeign Carrier Entry Order, 11 FCC Rcd at 3894.(#o  X-x*43.` ` No party disputes that an effective regulatory framework exists in Australia. (#(#XWe find that the Department of Communications and the Arts ("DCA"), the Australian Communications Authority ("ACA"), and the ACCC, the Australian governmental agencies responsible for developing telecommunications policy, regulating the telecommunications industry, and administering telecommunications competition policy are sufficiently separate from the carriers they regulate.  X -x+44.` ` The DCA sets overall telecommunications policy.SH Z {O% -ԍXxTI Opposition at 13.(#S The two Australian regulators are the ACA and the ACCC. The ACA is an independent agency "not subject to direction by or on behalf of the Commonwealth Government," except for certain written directions from the Minister of Communications which "must be published in the [official]  X -Gazette."I~  {O[-ԍXxCTS Second Update at 5 (citing provisions of the ACA Act). The ACA was formed by merging the Spectrum Management Agency ("SMA") and the Australian Telecommunications Authority ("AUSTEL")  {O-ԩ with the administration of competition regulation being transferred to the ACCC. Id. at 45; CWI  {O-Additional Information at 3; CCI Amendment at 2. The ACA consists of a Chairman, a Deputy Chairman and between one and three other members appointed by the GovernorGeneral. The Minister is also able to appoint associate members as the Ministers thinks fit for special purposes including inquiries and investigations. (# The ACA's main functions are regulating telecommunications in accordance with  X -the 1997 Act (including granting facilitiesbased licenses) and managing radiofrequency  X-spectrum in accordance with the Radiocommunications Act 1992.J2  {Os-ԍXxSee e.g., CTS Second Update at 5; CWI Additional Information at 34; TI Attachment 5 at 4.(#Ʒ  Xb-x,45.` ` The ACCC's main function is administering the industryspecific ACCC DESCRIPtelecommunications competitionrelated laws, including those pertaining to  X4-access/interconnection and the regulation of anticompetitive conduct.tK4  {O-ԍXxCTS Second Update at 5; TI Attachment 5 at 5. (#t Certain decisions of  X-the ACCC are reviewable by the Federal Court and others are reviewable by the Tribunal.VLV  {O$"-ԍXxCTS Second Update at 5.(#V  X-x-46.` ` We also find Australian regulatory policies to be fair and transparent. The ACCC has the power to issue a competition notice stating that a carrier or carriage service"L0*%%II"  X-provider has engaged in anticompetitive behavior.M" yOy-ԍXxAnticompetitive behavior is found "if the carrier or carriage service provider: (a) has a substantial degree of power in a telecommunications market; and (b) takes advantage of that power with the effect, or likely effect, of substantially lessening competition in that or any other telecommunications market."  {O-CTS Second Update at 6.(#ƣ Once a competition notice has been issued, the ACCC is able to seek pecuniary penalties and a third party is able to seek damages  X-if the carrier or carriage service provider continues to engage in the specified conduct.iN {O5-ԍXxId.; TI Attachment 5 at 1821.(#i  X-x.47.` ` In sum, we find that Australia offers U.S.based carriers equivalent resale opportunities in Australia. There is an effective regulatory framework in Australia that develops, implements, and enforces legal requirements, interconnection, and other competitive  X_-safeguards. Accordingly, we find that no actual or de facto conditions exist that warrant a  XJ-denial under the Commission's equivalency analysis.  X - B.XxEffective Competitive Opportunities ("ECO") Analysis (#  X -x/48.` ` TI also applies for authority to provide switched resale and resale of non X -interconnected private lines. Under the Foreign Carrier Entry Order, if TI possesses market  X -power, we must apply our ECO analysis.oO D {O-ԍXxForeign Carrier Entry Order, 11 FCC Rcd at 3928.(#o  X-x049.` ` The Foreign Carrier Entry Order defines "market power" as "the ability of the carrier to act anticompetitively against unaffiliated U.S. carriers through the control of  Xh-bottleneck services or facilities on the foreign end."]Ph {O-ԍXxId., 11 FCC Rcd at 3917.(#] Bottleneck services or facilities are "those that are necessary for the provision of international services, including intercity or  X:-local access facilities on the foreign end."HQ:h  {OS-ԍXxId.(#H  X -x150.` ` TI argues that Telstra is no longer treated as dominant in Australia. TI also claims that neither it nor Telstra has market power in the domestic long distance and local  X-access markets.dR  {O"-ԍXxTI Facilitiesbased Application at 8.(#d In response, AT&T asserts that the Australian regulator has not concluded that Telstra lacks market power. AT&T argues that Telstra is the governmentowned, dominant provider of telephone access, local, domestic, long distance, and international" R0*%%II" services in Australia. AT&T asserts that Telstra controls approximately 80 percent of the  X-U.S.Australia route and has the only ubiquitous facilitiesbased local exchange network.*S\ {Ob-ԍXxAT&T 1997 Reply at 4 (footnote omitted); AT&T Petition to Deny TI's Facilitiesbased Application at  {O,-25; AT&T Reply to TI's Opposition to AT&T's Petition to Deny TI's Facilitiesbased Application at 24.(#*  X-x251.` ` TI did not submit market share information for the domestic local services market. Telstra in its Public Offer Document containing information about the sale by the Commonwealth of Australia of up to onethird of the shares in Telstra, however, made a number of statements about the extent of Telstra's network infrastructure. For example, Telstra states that its fixed telecommunications network "extends across Australia, carrying over 90% of all calls and serving virtually all Australian homes and a substantial majority of  X1-Australian businesses."T1 yO -ԍXxTelstra Share Offer, Public Offer Document at 13 (Oct. 1997) (Copies of the relevant pages are available in the International Bureau's reference room, 2000 M Street, N.W., Washington, DC, 20554). (# Telstra also states that it provides basic access and local call services  X -to virtually all homes and most businesses in Australia.IU D {O-ԍXxId. at 17.(#I  X -x352.` ` In addition, in this proceeding TI does not dispute that it has the only ubiquitous facilitiesbased local exchange network in Australia. Optus has built digital switching facilities in major Australian cities and has assembled fiber optic cable links between the facilities. Optus has also built innercity "fiber rings" in the central business districts of Sydney, Melbourne, Canberra, Brisbane, Adelaide, and Perth. Optus also has constructed a hybrid fiber optical cable/coaxial cable ("HFC") network in Sydney, Melbourne, Adelaide, and Brisbane. Optus currently provides telephony service over the HFC network to  XK-approximately 10,000 to 20,000 directly connected customers.VK {O-ԍXxPaul Budde Communications Pty Ltd, Telecommunications Carriers and Service Providers Market  {O-1997/98. See also Mayne to cut Optus exposure, Fin. Rev. 1st ed., Nov. 25, 1997, at 21.(# Although Optus has built out to major cities in Australia, we do not find that these facilities offer a viable bypass alternative to Telstra's ubiquitous facilitiesbased local exchange network. Accordingly, consistent with our precedent, we find that TI's Australia affiliate, Telstra, possesses market power in the Australian market through its control of the only ubiquitous local exchange"2 V0*%%II"  X-network in Australia.W| {Oy-ԍXxBT North America Inc., Order and Authorization, File No. ITC96439, DA 972071  9 (rel. Sept. 25, 1997) (stating that the Commission had previously found that BT North America's U.K. affiliate, BT, possessed market power in the U.K. market through its ownership of the only ubiquitous local access  {O-network in the United Kingdom); Telecom New Zealand Limited, Order, Authorization and Certificate, File No. ITC96097, DA 962182  9 (rel. Dec. 31, 1996) (finding that Telecom New Zealand Limited has the ability to discriminate against unaffiliated U.S. carriers through its control of the only ubiquitous local exchange network in New Zealand).(# As a result, we will apply our "effective competitive opportunities" analysis to the Australian market.  X-x453.` ` AT&T argues that TI's application is "facially deficient" because it does not make the necessary showings that Australia meets the ECO test for switched resale and resale of noninterconnected private lines. In particular, AT&T argues that TI only addresses the legal ability to provide these resale services in Australia. AT&T does not dispute that carriers have the legal ability to provide switched resale and the resale of noninterconnected private lines.  X -x554.` ` We conclude that, because Australia satisfies our equivalency standard and the same factors are relevant for purposes of this ECO analysis, we do not need to conduct a full  X -ECO analysis for TI's application.X  {O-ԍXxIn the Foreign Carrier Entry Order the Commission stated that, with two practical distinctions, the ECO standard and the equivalency standard are the same. First, the ECO analysis applies only on routes where the foreign carrier controls bottleneck facilities, whereas the equivalency standard applies to all routes. Second, the ECO standard requires that ECO be satisfied in the near future, while the  {O-equivalency standard requires equivalency be satisfied at the time we make an equivalency finding.  {O-Foreign Carrier Entry Order, 11 FCC Rcd at 3926.(#Ɩ The only factor we need to examine is whether U.S. carriers have the legal right to provide switched resale and the resale of noninterconnected private lines. No party disputes the legal right to provide such resale. Accordingly, we find that Australia offers U.S.based carriers effective competitive opportunities to provide switched resale and noninterconnected private line resale.  Xy-  Xb-C.XxAdditional Public Interest Factors (#  X4-x655.` ` The additional public interest factors that we consider in assessing these applications include costbased accounting rates, the general significance of the proposed entry to the promotion of competition in the U.S. communications market, and any national security, law enforcement, foreign policy, and trade concerns raised by the Executive Branch.  X-x756.` ` AT&T opposes TI's entrance in the U.S. service market through any arrangement unless TI and Telstra are made subject to the conditions and safeguards in the" X0*%%II"  X-Commission's Benchmarks OrderY {Oy-ԍXxInternational Settlement Rates, Report and Order, IB Docket No. 96261, FCC 97280 (rel. Aug. 18,  {OC-1997) ("Benchmarks Order").(# and any conditions and safeguards adopted in the Foreign  X-Participation Order.}Z$ {O-ԍXxForeign Participation Order, supra note  FPN32 .(#}  X-x857.` ` We agree with AT&T. Thus, TI and Telstra, like any other carrier, are subject  X-to the rules and policies established in the Benchmarks and Foreign Participation orders.  X-Recently, in its Benchmarks Order, the Commission established benchmarks that will govern  X~-the international settlement rates [~ yO -ԍXxThe settlement rate refers to each carrier's portion of the accounting rate. In almost all cases, the settlement rate is equal to onehalf of the negotiated accounting rate. At settlement, each carrier nets the minutes of service it billed against the minutes the other carrier billed. The carrier that billed more minutes of service pays the other carrier a net settlement payment calculated by multiplying the settlement rate by the number of imbalanced minutes.(#  between U.S. carriers and foreign carriers. Pursuant to the  Xg-Benchmarks Order, U.S. carriers must negotiate a settlement rate with Australian carriers that  XR-does not exceed $0.15 before January 1, 1999.\Rf  yOi-ԍXxCurrently, the perminute settlement rate used to calculate net settlement payments for imbalanced minutes on the U.S.Australian route for traffic terminated by Telstra is $0.21.(# In the Benchmarks Order the Commission  X=-also adopted a condition that applies to authorizations to provide switched services over IPLs, effective as of January 1, 1998. The condition provides that carriers may not use their authorized international private lines for the provision of switched basic services "unless and until the Commission has determined that the country at the foreign end of the private line provides equivalent resale opportunities and that settlement rates for 50 percent of the settled U.S.billed traffic between the United States and that country are at or below the benchmark .  X -. . ."]  {O"-ԍXxBenchmarks Order at B4 (to be codified at 47 C.F.R.  63.21).(#ƀ Subsequently, in the Foreign Participation Order, the Commission eliminated the  X-equivalency requirement for WTO Members.r^P  {O-ԍXxForeign Participation Order at  76.(#r  As a result,once those rules take effect, carriers will no longer have to show that a WTO Member provides equivalent private line  Xp-resale opportunities. In the Foreign Participation Order, however, the Commission also concluded that, as an alternative to satisfying the benchmark condition, a carrier seeking to provide switched services over IPLs between the United States and a WTO Member may  X--satisfy the equivalency test.T_- {O#-ԍXxId. at  85.(#T In this Order, we have made an equivalency determination for Australia, a WTO Member. "t_0*%%II("Ԍ X-ԙx958.` ` We anticipate that the rules adopted in the Foreign Participation Order will  X-take effect in early February 1998.` {Od-ԍXxThis effective date complies with the requirements of 5 U.S.C.  801(a)(3) and 44 U.S.C.  3507. See  {O.-Foreign Participation Order at  391.(# As of the January 1, 1998, effective date of the  X-Benchmarks Order, however, all authorizations for the provision of switched basic services over IPLs will be subject to the benchmark condition. Thus, from January 1, 1998, until the  X-effective date of the Foreign Participation Order, the authorizations for the provision of switched basic services over IPLs granted in this Order will be subject to both an equivalency requirement and a requirement that settlement rates for at least 50 percent of the settled U.S.billed traffic between the United States and Australia are at or below the benchmark for Australia. No party has made a showing that the benchmarks requirement is satisfied at this time. Accordingly, U.S. carriers will be prohibited from providing switched services over IPLs between the United States and Australia until such a showing has been made or until the  X -Foreign Participation Order takes effect. At that time, the equivalency finding of this Order will satisfy our rules for providing switched basic services over IPLs.  X -  X -x:59.` `  In the Benchmarks Order the Commission also adopted a settlement rate benchmark condition for authorizations to provide facilitiesbased switched or private line service to destination markets where the authorized carrier is affiliated with a foreign carrier.  X-Specifically, pursuant to the Benchmarks Order, the Commission will condition any such authorization to serve an affiliated market on the affiliated foreign carrier offering U.S. international carriers a settlement rate for the affiliated market at or below the relevant  X@-benchmark.\a@$ {O-ԍXxBenchmarks Order at  231.(#\ In the Foreign Participation Order, however, the Commission declined to apply this benchmark condition to authorizations to provide switched resale services to affiliated  X-routes.tbD {O{-ԍXxForeign Participation Order at  211. The Commission, however, adopted a quarterly traffic and revenue reporting requirement for switched resellers on international routes where they are affiliated with a foreign carrier that possesses sufficient market power on the foreign end of the route to harm competition in the U.S. market and that collects settlement payments from U.S. carriers. The Commission adopted the requirement to enable it to detect whether affiliated resellers are engaging in  {Oe-traffic distortion schemes on affiliated routes. Id. at  211. Because in this order we classify TI as a dominant carrier on the U.S.Australia route, TI will be required to file quarterly traffic and revenue reports for its switched resale and all other services authorized in this order.(#t Thus, in providing switched resale to Australia, TI will not be subject to a benchmark condition.  X-  X- x;60.` ` Finally, the Executive Branch has not raised any national security, law enforcement, foreign policy, or trade concerns with these applications. We find that this authorization will benefit U.S. consumers calling Australia by adding more authorized" b0*%%II" carriers, thus increasing competition on that route. Accordingly, we find no additional public interest factors that warrant a denial of these applications.  X- D.XxOther Matters (#  X-Xx 1. Regulatory Treatment of TI (#  X_-x<61.` ` There is some dispute in the record about whether or not Telstra, TI's parent  XH-company, is a dominant carrier on the U.S.Australia route.cH {O -ԍXxSee e.g., AT&T Petition to Deny TI at 5; AT&T 1996 Reply at 3; AT&T 1997 Reply at 4; TI Opposition at 23.(# Because TI has agreed to be  X1-regulated as dominant we do not need to reach this issue.Ud1" {O -ԍXxTI Application at 34.(#U Accordingly, we will regulate TI as dominant on the U.S.Australia route.  X -Xx 2.X` ` Competitive Safeguards (#`  X -x=62.` ` MCI argues that Telstra has a "pivotal position" as a provider of origination and termination services in Australia and therefore the Commission should impose additional  X-conditions.We {O-ԍXxMCI Comments at 2. (#W MCI argues that the FCC should condition all TI's resale authorizations with the requirements that TI: (1) file with the FCC all agreements between TI and Telstra (including all oral agreements relating to the routing of U.S. traffic through Telstra's facilities); (2) purchase any Telstra services at published rates; and (3) maintain complete records on the provisioning and maintenance of network facilities and services it procures from Telstra and make those records available to the FCC upon request. MCI argues that these proposed conditions are derived from conditions placed on Teleglobe USA, Inc. which is authorized to engage in switched resale between the United States and overseas points and in the initial authorization of British Telecommunications plc to acquire an ownership interest  X-in MCI.]f\F {O-ԍXxMCI Comments at 24 (citing Teleglobe USA Inc., Order, Authorization and Certificate, 11 FCC Rcd 8162, 8171 (Int'l Bur., 1996); MCI Communications Corp. and British Telecommunications plc,  {OJ -Declaratory Ruling and Order, 9 FCC Rcd 3960, 3973 (1994)).(#]  X-x>63.` ` TI argues that TI proposes to act solely as a resale carrier and it would make little sense for Telstra to favor its U.S. affiliate because it would necessarily have to favor the underlying nonaffiliated U.S. facilitiesbased carrier as well. Moreover, TI argues that the first condition regarding FCC filing of agreements between TI and Telstra is covered by"Nj f0*%%II"  X-Section 43.51 of the Commission's rules.]gX yOy-ԍXxSection 43.51 of the Commission's rules require U.S. carriers to file with the Commission contracts, operating agreements, and other arrangements with foreign carriers that involve, among other things, the exchange of services and the interchange or routing of traffic. 47 C.F.R.  43.51.(#] Likewise, TI argues Section 43.51 covers the second requested condition because TI would be required to report the terms on which it acquires international capacity from Telstra. TI argues that whether or not Australia determines that Telstra must provide service in Australia under tariff is a domestic Australia matter. Finally, TI agrees to accept MCI's third condition regarding provisioning and  X-maintenance.Th {O& -ԍXxTI Opposition at 45.(#T  X_-x?64.` ` As a dominant carrier on the U.S.Australia route, TI will be required to comply with Section 63.10 of our rules. Section 63.10 of our rules requires carriers regulated as dominant on a particular route due to a foreign carrier affiliation to: (1) file tariffs on no less than 14days notice; (2) maintain complete records of the provisioning and maintenance of basic network facilities and services procured from the foreign carrier  X -affiliate;uiZ z yO-ԍXxThe recordkeeping requirement for basic network facilities and services includes those facilities and services that the dominant carrier procures on behalf of customers of joint ventures for the provision of  {O-U.S. basic or enhanced services. Foreign Carrier Entry Order, 11 FCC Rcd at 3975.(#u (3) obtain Commission approval pursuant to  63.18 before adding or discontinuing circuits; and (4) file quarterly reports of revenue, number of messages, and  X -number of minutes of both originating and terminating traffic.j  {O -ԍXx47 C.F.R.  63.10(c). We note, however, that in the Foreign Participation Order, the Commission  yO-revised the dominant carrier safeguards to: replace the fourteen-day advance notice tariff filing requirement with a one-day advance notice requirement and accord these tariff filings a presumption of lawfulness; remove the prior approval requirement for circuit additions or discontinuances on the dominant route; require a limited form of structural separation between a U.S. carrier and its foreign affiliate; retain the quarterly traffic and revenue reporting requirement; replace the provisioning and maintenance recordkeeping requirement with a quarterly reporting requirement that summarizes the provisioning and maintenance services provided by the foreign carrier to its U.S. affiliate; and require quarterly circuit status reports. The Commission declined to adopt its proposal to ban exclusive arrangements involving joint marketing, customer steering, and the use of foreign market telephone  {O-customer information. Foreign Participation Order at  222 .(#Ʊ Accordingly, our current rules are sufficient to address the conditions requested by MCI.  Xy-Xx 3.X` ` No Special Concessions (#`  XK-x@65.` ` Sprint argues that, as a result of CWI's affiliation with Optus, CWI may receive faster interconnection at preferential rates, quicker accounting rate reductions, or more"4j0*%%II "  X-favorable provisioning and maintenance arrangements.zk {Oy-ԍXxSprint Petition to Deny CWI at 13; Sprint Reply at 6.(#z CWI responds by certifying that it has not agreed to accept any special concessions directly or indirectly from any foreign carrier, including Optus.  X-xA66.` ` We currently prohibit all U.S. carriers, regardless of their regulatory status or whether they have a foreign affiliate, from agreeing to accept special concessions from any  Xv-foreign carrier or administration.l"vZ {O -ԍXxSee 47 C.F.R.  63.14. Current Commission rules define "special concessions" as "any arrangement that affects traffic or revenue flows to or from the United States that is offered exclusively by a foreign carrier or administration to a particular U.S. international carrier and not also to similarly situated U.S. international carriers authorized to serve a particular route." 47 C.F.R.  63.18(i)(1).(# CWI is subject to our current "No Special Concessions"  X_-rule. We note that in the Foreign Participation Order, the Commission gives greater specificity to the "No Special Concessions" rule by delineating the types of conduct that the  X3-Commission considers to be prohibited.km3D {O(-ԍxForeign Participation Order at  165 .k The Commission also modified its "No Special Concessions" rule so as only to prohibit U.S. carriers from agreeing to accept special concessions from a foreign carrier that possesses sufficient market power on the foreign end  X -of the relevant route to affect competition adversely in the U.S. market.On  {Ou-ԍXxId. at  156.(#O The Commission makes clear, however, that the "No Special Concessions" rule does not alter the International Settlements Policy or the Commission's policy governing alternative settlement  X -arrangements.Vo h  {O-ԍXxId. at  158, n.308.(#V We note that on September 18, 1997, CWI notified us that it has increased its ownership interest in Optus to 49 percent, which constitutes an affiliation under Section  X{-63.18(h)(1)(i) of the Commission's rules.^p{  {O&-ԍXxCWI Letter, supra note 2.(#^ We placed CWI's notification on public notice  Xd-on November 20, 1997.qd  {O-ԍXxForeign Carrier Affiliation Notification, Public Notice, Report No. I8272 (Nov. 20, 1997).(#Ơ No comments were received. We find no evidence either in this record or in CWI's affiliation notification to make a finding that CWI should be regulated as dominant on the U.S.Australia route. We reserve the right to reconsider this decision, however, pursuant to our authority under Section 63.11 of the Commission's rules. "q0*%%II "  X-} IV. CONCLUSION  X- xB67.` ` Because we find that Australia offers equivalent private line resale opportunities to U.S.based carriers for the provision of switched services, we grant the applications before us in this proceeding. We also grant TI authority to provide switched resale and noninterconnected private line resale. We believe that resale between the United States and Australia will promote competition and the introduction of new international telecommunications services.  XH-  X1-6V. ORDERING CLAUSES ă  X -xC68.` ` In view of the foregoing, IT IS HEREBY CERTIFIED that the present and future public convenience and necessity require the provision of resale of private lines for the provision of switched services between the United States and Australia.  X -xD69.` ` Accordingly, IT IS HEREBY ORDERED that File Nos. ITC93328, ITC94 X-435, ITC95015, ITC95116, ITC95185, and ITC96182 ARE GRANTED and Cable & Wireless, Inc., GTI Network, Inc., MFS International, Inc., Communication Telesystems International, INTEX Telecommunications Inc., and Cherry Communications, Inc. are authorized to resell international private lines interconnected to the public switched network for the provision of switched services between the United States and Australia including voice, data, and facsimile.  X-xE70.` ` IT IS FURTHER ORDERED that File No. ITC96319 IS GRANTED and Telstra, Inc. is authorized to: (1) resell international private lines interconnected to the public switched network for the provision of switched services between the United States and Australia including voice, data, and facsimile; (2) resell international private lines not interconnected to the public switched network for the provision of international private line services between the United States and Australia; and (3) provide international switched resale between the United States and Australia.  X7-xF71.` ` IT IS FURTHER ORDERED that the authority granted herein to resell international private lines between the United States and Australia for the provision of switched services is limited to the provision of such services between the United States and Australia only that is, private lines which carry traffic that originates in the United States and terminates in Australia, or traffic that originates in Australia and terminates in the United States. This restriction is subject to the following exceptions: (a) applicants may engage in "switched hubbing" through Australia consistent with Section 63.17 of the Commissions rules,  X"-47 C.F.R.  63.17; and (b) applicants may provide U.S. inbound or outbound switched basic service over their authorized private lines extending between the United States and the United Kingdom, Sweden, New Zealand, and Australia provided that the particular applicant also is"h$q0*%%II(#" authorized to provide switched basic service using resold private lines between the United  X-States and those countries.  X- xG72.55` ` 87DOMIT IS FURTHER ORDERED that Telstra, Inc. shall be regulated as a dominant carrier on the U.S.Australia route, pursuant to Section 214 of the Act, 47 U.S.C.  214, and Section 63.10 of the Commission's rules, 47 C.F.R.  63.10, and shall comply with the requirements of paragraph (c) of that section. The quarterly traffic reports filed pursuant to Section 63.10(c) must include the information required by Section 43.61 of the Commission's rules, 47 C.F.R.  43.61, for "facilities resale" on the U.S.Australia route.  X -xH73.` ` IT IS FURTHER ORDERED that except as provided in paragraph 72, all applicants shall comply with Sections 63.15(b) and 63.21 of the Commission's rules, 47 C.F.R.  63.15(b) and 63.21. In addition, all applicants except Telstra, Inc. shall also file the information required by Section 43.61 for "facilities resale" on the U.S.Australia route on a semiannual basis not later than September 30 for the prior January through June period and March 31 for the second sixmonth calendar period, for the first three calendar years after this equivalency finding.  Xb-xI74.` ` IT IS FURTHER ORDERED that all Motions for Extension of Time ARE GRANTED.  X-xJ75.` ` IT IS FURTHER ORDERED that AT&T's Petitions to Deny ARE DENIED.  X-xK76.` ` IT IS FURTHER ORDERED that Sprint's Petition to Deny in Part IS DENIED.  X-xL77.` ` IT IS FURTHER ORDERED that grant of these authorizations are conditioned upon Australia's continuing to afford resale opportunities to U.S.based carriers equivalent to those afforded under U.S. law.  XN- xM78.` ` This Order is issued under Section 0.261 of the Commission's rules, 47 C.F.R.  0.261 (1996), and is effective upon adoption. Petitions for reconsideration under Section "7q0*%%II?" 1.106 of the Commission's rules, 47 C.F.R.  1.106 (1996), or applications for review under Section 1.115 of the Commission's rules, 47 C.F.R.  1.115 (1996), may be filed within 30 days of the date of public notice of this Memorandum Opinion, Order and Certificate (see 47 C.F.R.  1.4(b)(2)).  X- x` `  hhFEDERAL COMMUNICATIONS COMMISSION  X1- x` `  hhRegina M. Keeney x` `  hhChief, International Bureau