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                       CONSENT DECREE

                      I.  Introduction

     1.   This  consent  decree  is   entered  into  by  the 
Enforcement Bureau of  the Federal Communications Commission 
(``Bureau'') and Verizon  Communications Inc. (``Verizon''), 
terminating an informal  Bureau investigation into Verizon's 
compliance  with  the  Merger   Conditions  imposed  by  the 
Commission in Application of GTE Corp., Transferor, and Bell 
Atlantic Corp., Transferee, for  Consent to Transfer Control 
of  Domestic   and  International   Sections  214   and  310 
Authorizations  and Application  to  Transfer  Control of  a 
Submarine  Cable Landing  License, 15  FCC Rcd  14032 (2000) 
(``BA/GTE Merger Order'').

                       II.  Background

     2.   On June 16, 2000, the Commission approved, subject 
to explicit  conditions, the transfer of  licenses and lines 
from GTE Corporation (``GTE'')  to Bell Atlantic Corporation 
(``BA'') (collectively, ``Verizon'')  in connection with the 
merger of the two companies.   To offset the potential harms 
arising  out  of  the  merger,  Verizon  proposed,  and  the 
Commission  adopted,  a  series of  conditions  intended  to 
enhance local  competition and to strengthen  the incentives 
of Verizon  to expand  competition outside  its territories.  
Verizon   also  proposed   conditions   designed  to   avoid 
violations  of section 271  of the  Act as  a result  of the 
merger.1    In  particular,   Verizon   proposed,  and   the 
Commission  adopted, a  condition to  spin-off substantially 
all of GTE's  nationwide data business to  a separate public 
corporation (i.e., Genuity).  

     3.   Market-Opening  Condition V  of the  BA/GTE Merger 
Order requires Verizon to  file publicly monthly performance 
measurement  data  under  a  Carrier-to-Carrier  Performance 
Assurance  Plan   (``PAP'').2   The  PAP   measures  Verizon 
performance in 17 different categories or metrics, which are 
broken  down into  numerous sub-metrics,  and which  address 
functions that  can affect  Verizon's local  competitors and 
their customers.  These categories cover key aspects of pre-
ordering,  ordering, provisioning,  maintenance and  repair, 
and  billing  associated  with  unbundled  network  elements 
(``UNEs''), interconnection, and  resold services. Under the 
PAP,  Verizon  shall make  voluntary  payments  to the  U.S. 
Treasury  if Verizon  fails to  provide a  certain level  of 
performance.  Verizon is subject to voluntary payments of up 
to $1.164 billion for  continued poor performance over three 
years.3      

     4.   Market-Opening Condition XIX  of the BA/GTE Merger 
Order requires Verizon to  submit quarterly consumer service 
quality   reports.4   Market-Opening   Condition  XIX   also 
requires Verizon  to report  special access  service quality 
data to the  Commission and an independent  auditor in order 
to protect against discrimination in favor of Genuity in the 
provision of special access services.5  

     5.   Market-Opening   Condition    XXII   and   Genuity 
Condition VI of  the BA/GTE Merger Order  require Verizon to 
engage annually an independent  auditor to examine Verizon's 
compliance  with the  Merger Conditions.   The annual  audit 
provides a  thorough and systematic evaluation  of Verizon's 
compliance with the Merger Conditions and the sufficiency of 
Verizon's internal controls.   

     6.   On June 1,  2001, PricewaterhouseCoopers (``PWC'') 
filed an  audit report addressing Verizon's  compliance with 
certain  Market-Opening Conditions  under the  BA/GTE Merger 
Order, from June  30, 2000 through December  31, 2000 (``PWC 
Audit  Report'').   The  PWC  Audit  Report  indicates  that 
Verizon failed to submit certain historical performance data 
to PWC, which limited the scope of the audit.  The PWC Audit 
Report   indicates  that   Verizon  did   not  provide   the 
independent  auditor data  for  2  of 17  Carrier-to-Carrier 
performance  measurements   and  2   of  5   special  access 
performance  measurements.6    The  PWC  Audit   Report  and 
Verizon's  Assertions  accompanying  the audit  report  also 
identify   performance  reporting   inaccuracies.7   Verizon 
states  in its  Assertions  that  its performance  reporting 
inaccuracies were due to  problems with systems development, 
long-term   systems  enhancement,   data  extraction,   data 
calculations,    report   mapping,    data   posting,    and 
misapplication  of business  rules.   Errors in  performance 
reports  can  affect  the   amount  of  Verizon's  voluntary 
payments for failing to meet performance levels specified in 
the  PAP.   Verizon has  disclosed  in  the 2001  audit,  in 
reports  to  the Commission,  and  in  discussions with  the 
Bureau  similar  performance   reporting  inaccuracies  that 
appear  to  have  occurred  during  the  January  1  through 
December 31, 2001 period.  

     7.   Also  on  June 1,  2001,  Verizon  filed with  the 
Commission  an  audit  report   by  Mitchell  &  Titus,  LLP 
(``M&T'') addressing  Verizon's compliance with  the Genuity 
Conditions under the BA/GTE Merger Order, from June 30, 2000 
through December  31, 2000  (``M&T Audit  Report'').  During 
the audit, the independent auditor tested agreements between 
Verizon  and   Genuity  for  compliance  with   the  Genuity 
Conditions.  Of  157 agreements disclosed to  M&T by Verizon 
before June 1, 2001, M&T  reported that 11 were submitted by 
Verizon too late  for M&T to test them in  time for the June 
1, 2001  filing.  After June  1, 2001, Verizon  disclosed to 
M&T that  additional agreements between Verizon  and Genuity 
existed besides the 157 previously disclosed to M&T.  

     8.   The Bureau initiated an Investigation of Verizon's 
potential  non-compliance  with   the  BA/GTE  Merger  Order 
arising out of the facts disclosed  in the PWC and M&T Audit 
Reports   and   continuing   through  December   2001.    In 
particular, the Bureau's  Investigation focused on Verizon's 
compliance with  the performance reporting  requirements and 
the audit requirements.  

                      III.  Definitions

     9.   For  the  purposes  of  this  Consent  Decree  the 
following definitions shall apply:

          (a)  ``Commission'' or  ``FCC'' means  the Federal 
               Communications Commission.

          (b)  ``Bureau''  means the  Enforcement Bureau  of 
               the Federal Communications Commission.

          (c)  ``Verizon'' means Verizon Communications Inc. 
               and any subsidiaries.

          (d)  ``Parties'' means Verizon and the Bureau.

          (e)  ``Adopting  Order''  means  an Order  of  the 
               Bureau adopting  the terms and  conditions of 
               this Consent Decree.

          (f)  ``Effective  Date'' means  the date  on which 
               the Bureau releases the Adopting Order.

          (g)  ``Investigation''  means   the  investigation 
               initiated by the Bureau regarding the matters 
               discussed   in  paragraphs   6  -   8  above, 
               concerning Verizon's conduct  during the June 
               30, 2000 to December 31, 2001 period.

                       IV.  Agreement

     10.  Verizon  agrees that  the Bureau  has jurisdiction 
over the  matters contained in  this Consent Decree  and the 
authority to enter into and adopt this Consent Decree.

     11.  Verizon  agrees to  implement the  Compliance Plan 
attached  hereto  and  incorporated by  reference,  to  help 
ensure   Verizon's  future   compliance   with  the   Merger 
Conditions under the BA/GTE Merger Order.  

     12.  Verizon  agrees that  it  shall  make a  voluntary 
contribution to the United States  Treasury in the amount of 
$260,000 (two hundred sixty  thousand dollars).  This amount 
shall be paid within 30 days  of the date on which the order 
adopting   this   Consent   Decree  becomes   final.    Such 
contribution  shall  be  made, without  further  protest  or 
recourse, by certified check, cashiers check, wire transfer, 
or  money   order  drawn  to   the  order  of   the  Federal 
Communications  Commission,  and  shall  be  mailed  to  the 
Forfeiture  Collection  Section,   Finance  Branch,  Federal 
Communications Commission, P.O. Box 73482, Chicago, Illinois 
60673-7482, or  be submitted  by wire transfer  according to 
instructions provided  by the  Bureau.  Reference  should be 
made  on   the  check   or  money   order  to   ``Acct.  No. 
200232080021.''

     13.  In  express   reliance  upon  the   covenants  and 
representations contained in this Consent Decree, the Bureau 
agrees  to  terminate  its Investigation  into  the  matters 
discussed in paragraphs 6 -  8 above, without any finding of 
liability on the part of Verizon.

     14.  The  Bureau  agrees  that,   based  on  the  facts 
developed  in  this  Investigation  and in  the  absence  of 
material new  evidence related to  this matter, it  will not 
use the  facts developed  in this Investigation  through the 
Effective Date  of the  Consent Decree  or the  existence of 
this Consent Decree to institute, on its own motion, any new 
proceeding, formal  or informal, or  take any action  on its 
own motion against Verizon  concerning the matters discussed 
in paragraphs  6 -  8 above.  The  Bureau also  agrees that, 
based on  the facts developed  in the Investigation,  and in 
the absence of material new evidence related to this matter, 
it will  not use the  facts developed in  this Investigation 
through the  Effective Date  of this  Consent Decree  or the 
existence of  this Consent  Decree to  institute on  its own 
motion  any  proceeding, formal  or  informal,  or take  any 
action on its own motion against Verizon with respect to its 
basic     qualifications,     including    its     character 
qualifications, to be a  Commission licensee or with respect 
to compliance with the Commission's rules and policies.

     15.  Nothing in  this Consent Decree shall  prevent the 
Commission  from adjudicating  complaints filed  pursuant to 
section 208 of the Communications Act, as amended, 47 U.S.C. 
  208,  against  Verizon  or  its  affiliates  for  alleged 
violations of the BA/GTE Merger Order, or for any other type 
of alleged  misconduct, regardless  of when  such misconduct 
took place.  If any such complaint is made, the Commission's 
adjudication of that  complaint will be based  solely on the 
record  developed  in  that  proceeding.   Nothing  in  this 
Consent Decree shall prevent the Commission from instituting 
new  investigations   or  enforcement   proceedings  against 
Verizon  pursuant  to sections  4(i),  403  and 503  of  the 
Communications  Act  in  the  event of  any  alleged  future 
misconduct.

     16.  In  the  event  that   Verizon  is  found  by  the 
Commission or its  delegated authority to have  engaged in a 
violation  of  the BA/GTE  Merger  Order  subsequent to  the 
release  of  the  Adopting  Order,  the  Commission  or  its 
delegated  authority  reserves  the right  to  consider  the 
conduct described in  paragraphs 6 - 8  above in determining 
an appropriate  sanction.  If such conduct  is considered by 
the Commission or its  delegated authority in determining an 
appropriate  sanction, Verizon  will  not  be estopped  from 
litigating the issues  of whether such conduct  or the facts 
involved in  such conduct actually  violated the Act  or the 
Commission's rules, the merits  of Verizon's conduct, or the 
relevance or weight  to be given such  conduct under section 
1.80 of the Commission's rules.

     17.  Verizon waives any  and all rights it  may have to 
seek  administrative  or judicial  reconsideration,  review, 
appeal or  stay, or  to otherwise  challenge or  contest the 
validity  of this  Consent  Decree and  the Adopting  Order, 
provided the Order adopts the Consent Decree without change, 
addition, or modification.

     18.  Verizon waives  any rights  it may have  under any 
provision of  the Equal  Access to Justice  Act, 5  U.S.C.  
504.

     19.  In the event that  this Consent Decree is rendered 
invalid by any court of competent jurisdiction, this Consent 
Decree shall become null and void and may not be used in any 
manner in any legal proceeding.

     20.  If either Party (or the United States on behalf of 
the  Commission) brings  a  judicial action  to enforce  the 
terms  of  the  Adopting  Order,  neither  Verizon  nor  the 
Commission shall contest the  validity of the Consent Decree 
or the Adopting  Order, and Verizon and  the Commission will 
waive any statutory right to a trial de novo with respect to 
any matter upon which the Adopting Order is based, and shall 
consent  to  a  judgment  incorporating the  terms  of  this 
Consent Decree.

     21.  The  Bureau and  Verizon agree  that this  Consent 
Decree is for settlement purposes  only and that it does not 
constitute an admission, denial, adjudication on the merits, 
or a factual or legal determination regarding any compliance 
or noncompliance with the  requirements of the BA/GTE Merger 
Order.

     22.  Verizon agrees  that any violation of  the Consent 
Decree  or the  Adopting  Order will  constitute a  separate 
violation of a Commission order, entitling the Commission to 
exercise any rights or remedies attendant to the enforcement 
of a Commission order.

     23.  This Consent Decree may be signed in counterparts.


For the Enforcement Bureau              For Verizon 
Communications Inc.
Federal Communications Commission       


________________________________        
________________________________
David H. Solomon                   Jeffrey Ward
Chief                              Senior Vice President



_______________________________         
________________________________
Date                          Date
                     COMPLIANCE PLAN OF
                VERIZON COMMUNICATIONS, INC.

     To better ensure compliance with the Merger Conditions 
set forth in the BA/GTE Merger Order, Verizon 
Communications, Inc. (``Verizon'') will establish a formal 
compliance program, which will consist of the following 
remedial actions:

     24.  Vice Presidential steering committees 

Verizon will establish one or more Vice Presidential 
steering committees to review the accuracy of performance 
and service quality reporting pursuant to Market-Opening 
Conditions V and XIX, the retention and submission of 
relevant data needed by independent auditors to examine 
compliance with Market Opening Conditions V, XIX and XXII 
and Genuity Condition VI,  and the remedial actions and 
process improvements for compliance with such conditions set 
forth in this Consent Decree.  The primary goals of the 
steering committees will be to ensure that there are 
reasonable assurances that (1) the performance as measured 
and reported by Verizon is equivalent to the performance 
that Verizon has actually delivered, and (2) all relevant 
information needed to demonstrate compliance with the 
Market-Opening Conditions V, XIX and XXII and Genuity 
Condition VI during the annual merger audits is retained and 
submitted to the independent auditors.  The steering 
committee will oversee Verizon's process improvements and 
remedial actions for improving performance reporting 
accuracy and the retention and submission of data.  To 
accomplish this, the steering committee will oversee the 
following principal efforts:

              Examine Verizon's processes for reviewing 
               reporting accuracy in order to ensure that 
               Verizon consistently can and does 
               appropriately capture, process and report 
               performance information in accordance with 
               the applicable business rules. 
              Conduct analysis of sample metrics data sets 
               and change controls between data providers 
               and data reporters to ensure metric accuracy 
               and business rule compliance. 
              Perform independent internal calculations of 
               performance measures through a dedicated 
               Verizon Quality Assurance Team that performs 
               metrics replication independently of data 
               providers and data reporters to verify metric 
               calculation accuracy and business rule 
               compliance.
              Implement the measures set forth in this 
               Consent Decree regarding the retention and 
               submission of data to the independent 
               auditors conducting the annual merger audits 
               of Market-Opening Conditions V, XIX, XXII and 
               Genuity Condition VI.
          
Verizon will implement these activities within 45 days of 
the Effective Date of this Consent Decree.
               
     25.  Error analysis and prevention process        

Verizon will implement a performance metrics error 
prevention process that will track and analyze metrics 
reporting accuracy for Market-Opening Conditions V and XIX.   
Verizon will develop a tracking mechanism that will be used 
in error prevention and root cause analysis.  Effective with 
the implementation of the tracking mechanism, Verizon data 
providers and data reporters will be graded for their 
ability to deliver data in a timely and accurate manner, 
while their errors will be identified and analyzed for error 
prevention activities in order to reduce their recurrence. 
Vice Presidential-level employees responsible for the 
production of this data will have, as material elements in 
their performance evaluations, the accuracy, timeliness and 
retention of this data, and submission of this data to the 
independent auditors.  Verizon will implement these 
activities within 45 days of the Effective Date of this 
Consent Decree.

     26.  Refresher training 

Verizon will provide refresher training to all data 
providers and data reporters on proper guidelines for 
interpretation of business rules and change control process 
for Market-Opening Conditions V and XIX.  Verizon will 
complete a training package that will be ready for use 
within 45 days of this Consent Decree.  Verizon will review 
metrics business rules and their interpretations, along with 
the metrics change control process, with Verizon data 
providers and data reporters within 4 months of the 
Effective Date of this Consent Decree.  

     27.  Data Retention

Annually, Verizon will communicate to all responsible 
executives for each Merger Condition the importance of 
retaining relevant information to demonstrate compliance 
with the Merger Conditions in the annual merger audits.  
Within 30 days of this Consent Decree, Verizon will (1) 
retain all data that Verizon used in the calculation of 
Market-Opening Conditions V and XIX reports for a period 
ending 12 months after the relevant annual audit report is 
issued; and (2) issue training materials to data providers 
to meet this requirement.
          
     28.  Data Warehouse 

Verizon will establish a ``data warehouse'' for Market-
Opening Condition V reporting data in Verizon East, and 
later incorporate the existing one in Verizon West, that 
will store and retain data for calculation of all reports in 
a centralized location within 12 months for Verizon East, 
and within 18 months for Verizon West, from the Effective 
Date of this Consent Decree.  The data warehouse will 
produce a data reporting architecture for Market-Opening 
Condition V that will provide common platforms and 
procedures across the Verizon footprint for reporting 
metrics.   Verizon will provide a progress report on this 
remedial action to the Enforcement Bureau every 6 months 
from the Effective Date of this Consent Decree until the 
data warehouse is completed.  
                                                       
     29.  Submission of Genuity Transactions

No later than 45 days after the Effective Date of this 
Consent Decree, if Verizon has not already done so, Verizon 
will reinforce in writing and orally, with Verizon managers 
responsible for transactions between Verizon and Genuity 
companies, the requirement for timely provision of Genuity 
transactions to Verizon's Genuity audit management group in 
order to timely submit such transactions to the independent 
auditor for the relevant audit period.  Reinforcement will 
be made in writing in Genuity Condition compliance messages 
periodically sent to such managers and in quarterly 
compliance reporting process documents.  Vice Presidential-
level employees responsible for the submission of these 
transactions will have, as a material element in their 
performance evaluations, the submission of these 
transactions to the independent auditors.

     30.  Review with the Enforcement Bureau 

By December 31, 2002, Verizon will provide to the 
Enforcement Bureau a report on the effectiveness of these 
remedial actions and the need, if any, for further process 
improvements for Market-Opening Conditions V, XIX and XXII 
and Genuity Condition VI. 

     31.  Compliance audit 

Review of Verizon's compliance with these remedial actions 
will be included in the annual audits of Verizon's internal 
controls and compliance under Market-Opening Condition XXII.

     32.  Term of Consent Decree 

These remedial actions will expire when the related Merger 
Conditions expire in accordance with the terms of the BA/GTE 
Merger Order, or subsequent orders by the Commission or its 
delegated authority concerning the merger.






_________________________

1 Section 271 of the Communications Act of 1934, as amended 
(the ``Act''), 47 U.S.C.  271, prohibits a Bell operating 
company (``BOC''), or its affiliate, from entering the in-
region, interLATA market, unless the BOC demonstrates that 
its local market is open to competition in accordance with 
the requirements of section 271.  BA/GTE Merger Order at  
26.

2 BA/GTE Merger Order at Appendix D,  16-17 & Attachment 
A.

3 Id. at Appendix D,  16.

4 The consumer service quality reports must be submitted in 
accordance with a Service Quality White Paper, which was 
adopted by the National Association of Regulatory Utility 
Commissioners (``NARUC''), Technology Policy Subgroup in 
November 1998.  NARUC's Service Quality White Paper measures 
installation and repair performance, switch and transmission 
facility outages, consumer complaints, and answer time 
performance.  This condition was designed to deter service 
quality degradation and motivate Verizon to improve service 
quality.  BA/GTE Merger Order at  328.

5 Id. at  330.

6 PWC Audit Report at 1 (``The Company did not maintain 
historical transaction data related to Verizon East (South) 
Network Performance-1 (Condition V), Verizon East Average 
Installation Interval (Condition XIX) and Verizon East 
Percentage Commitment Met (Condition XIX) measurements, and 
the historical transaction data for the Verizon East 
Provisioning-09 (Condition V) measurement was only available 
within a timeframe of 45 days.  The unavailability of this 
historical transaction data prevented us from applying the 
procedures we considered necessary in the circumstances to 
test these reported measurements.'').

7 May 31, 2001 Report of Management on Compliance with  
Merger Conditions (``Assertions'') at Attachment A 
(Condition V - Carrier-to-Carrier Performance Plan) & 
Attachment C (Condition XIX - Additional Service Quality 
Reporting).