or former signatory financial interest in such entity;

(II) any signatories and former signatories that retain a financial interest in such successor entity do not possess, together or individually, effective control of such successor entity; and

(III) no intergovernmental organization has any ownership interest in a successor entity of INTELSAT or more than a minimal ownership interest in a successor entity of Inmarsat;

(ii) the successor entity provides such financial and other information to the Commission as the Commission may require to verify such certification; and

(iii) the Commission determines, after notice and comment, that the successor entity is in compliance with such certification.

(G) For purposes of subparagraph (F), the term "substantial dilution" means that a majority of the financial interests in the successor entity is no longer held or controlled, directly or indirectly, by signatories or former sig

natories.

(6) REGULATORY TREATMENT.-Any successor entity or separated entity created after the date of enactment of this title shall apply through the appropriate national licensing authorities for international frequency assignments and associated orbital registrations for all satellites.

(7) COMPETITION POLICIES IN DOMICILIARY COUNTRY.-Any successor entity or separated entity shall be subject to the jurisdiction of a nation or nations that

(A) have effective laws and regulations that secure competition in telecommunications services;

(B) are signatories of the World Trade Organization

Basic Telecommunications Services Agreement; and

(C) have a schedule of commitments in such Agreement that includes non-discriminatory market access to their satellite markets.

SEC. 622. [47 U.S.C. 763a] SPECIFIC CRITERIA FOR INTELSAT.

In securing the privatizations required by section 621, the following additional criteria with respect to INTELSAT privatization shall be applied as licensing criteria for purposes of subtitle A:

(1)1 TECHNICAL COORDINATION UNDER INTELSAT AGREEMENTS.-Technical coordination shall not be used to impair competition or competitors, and shall be conducted under International Telecommunication Union procedures and not under Article XIV(d) of the INTELSAT Agreement.

SEC. 623. [47 U.S.C. 763b] SPECIFIC CRITERIA FOR INTELSAT SEPARATED ENTITIES.

In securing the privatizations required by section 621, the following additional criteria with respect to any INTELSAT separated entity shall be applied as licensing criteria for purposes of subtitle A:

1 So in law. There is no paragraph (2).

(1) DATE FOR PUBLIC OFFERING.-Within one year after any decision to create any separated entity, a public offering of the securities of such entity shall be conducted. In the case of a separated entity created before January 1, 1999, such public offering shall be conducted no later than July 1, 2000, except that the Commission may extend this deadline in consideration of market conditions and relevant business factors relating to the timing of an initial public offering, but such extensions shall not permit such offering to be conducted later than July 31, 2001.

(2) INTERLOCKING DIRECTORATES OR EMPLOYEES.-None of the officers, directors, or employees of any separated entity shall be individuals who are officers, directors, or employees of INTELSAT.

(3) SPECTRUM ASSIGNMENTS.-After the initial transfer which may accompany the creation of a separated entity, the portions of the electromagnetic spectrum assigned as of the date of enactment of this title to INTELSAT shall not be transferred between INTELSAT and any separated entity.

(4) REAFFILIATION PROHIBITED.-Any merger or ownership or management ties or exclusive arrangements between a privatized INTELSAT or any successor entity and any separated entity shall be prohibited until 11 years after the completion of INTELSAT privatization under this title.

SEC. 624. [47 U.S.C. 763c] SPACE SEGMENT CAPACITY OF THE GMDSS. The United States shall preserve the space segment capacity of the GMDSS. This section is not intended to alter the status that the GMDSS would otherwise have under United States laws and regulations of the International Telecommunication Union with respect to spectrum, orbital locations, or other operational parameters, or to be a barrier to competition for the provision of GMDSS

services.

SEC. 625. [47 U.S.C. 763d] ENCOURAGING MARKET ACCESS AND PRIVATIZATION.

(a) NTIA DETERMINATION.—

(1) DETERMINATION REQUIRED.-Within 180 days after the date of enactment of this section, the Secretary of Commerce shall, through the Assistant Secretary for Communications and Information, transmit to the Commission—

(A) a list of Member countries of INTELSAT and Inmarsat that are not Members of the World Trade Organization and that impose barriers to market access for private satellite systems; and

(B) a list of Member countries of INTELSAT and Inmarsat that are not Members of the World Trade Organization and that are not supporting pro-competitive privatization of INTELSAT and Inmarsat.

(2) CONSULTATION.-The Secretary's determinations under paragraph (1) shall be made in consultation with the Federal Communications Commission, the Secretary of State, and the United States Trade Representative, and shall take into account the totality of a country's actions in all relevant fora, including the Assemblies of Parties of INTELSAT and Inmarsat.

(b) IMPOSITION

Notwithstanding—

OF COST-BASED SETTLEMENT

RATE.

(1) any higher settlement rate that an overseas carrier charges any United States carrier to originate or terminate international message telephone services; and

(2) any transition period that would otherwise apply, the Commission may by rule prohibit United States carriers from paying an amount in excess of a cost-based settlement rate to overseas carriers in countries listed by the Commission pursuant to subsection (a).

(c) SETTLEMENTS POLICY.-The Commission shall, in exercising its authority to establish settlements rates for United States international common carriers, seek to advance United States policy in favor of cost-based settlements in all relevant fora on international telecommunications policy, including in meetings with parties and signatories of INTELSAT and Inmarsat.

Subtitle C-Deregulation and Other

Statutory Changes

SEC. 641. [47 U.S.C. 765] ACCESS TO INTELSAT.

(a) ACCESS PERMITTED.-Beginning on the date of enactment of this title, users or providers of telecommunications services shall be permitted to obtain direct access to INTELSAT telecommunications services and space segment capacity through purchases of such capacity or services from INTELSAT. Such direct access shall be at the level commonly referred to by INTELSAT, on the date of enactment of this title, as "Level III".

(b) RULEMAKING.-Within 180 days after the date of enactment of this title, the Commission shall complete a rulemaking, with notice and opportunity for submission of comment by interested persons, to determine if users or providers of telecommunications services have sufficient opportunity to access INTELSAT space segment capacity directly from INTELSAT to meet their service or capacity requirements. If the Commission determines that such opportunity to access does not exist, the Commission shall take appropriate action to facilitate such direct access pursuant to its authority under this Act and the Communications Act of 1934. The Commission shall take such steps as may be necessary to prevent the circumvention of the intent of this section.

(c) CONTRACT PRESERVATION.-Nothing in this section shall be construed to permit the abrogation or modification of any contract. SEC. 642. [47 U.S.C. 765a] SIGNATORY ROLE.

(a) LIMITATIONS ON SIGNATORIES.—

(1) NATIONAL SECURITY LIMITATIONS.-The Federal Communications Commission, after a public interest determination, in consultation with the executive branch, may restrict foreign ownership of a United States signatory if the Commission determines that not to do so would constitute a threat to national security.

(2) NO SIGNATORIES REQUIRED.-The United States Government shall not require signatories to represent the United

States in INTELSAT or Inmarsat or in any successor entities after a pro-competitive privatization is achieved consistent with sections 621, 622, and 624.

(b) CLARIFICATION OF PRIVILEGES AND IMMUNITIES OF COMSAT.

(1) GENERALLY NOT IMMUNIZED.-Notwithstanding any other law or executive agreement, COMSAT shall not be entitled to any privileges or immunities under the laws of the United States or any State on the basis of its status as a signatory of INTELSAT or Inmarsat.

(2) LIMITED IMMUNITY.-COMSAT or any successor in interest shall not be liable for action taken by it in carrying out the specific, written instruction of the United States issued in connection with its relationships and activities with foreign governments, international entities, and the intergovernmental satellite organizations.

(3) NO JOINT OR SEVERAL LIABILITY.-If COMSAT is found liable for any action taken in its status as a signatory or a representative of the party to INTELSAT, any such liability shall be limited to the portion of the judgment that corresponds to COMSAT's percentage of the ownership of INTELSAT at the time the activity began which lead to the liability.

(4) PROVISIONS PROSPECTIVE.-Paragraph (1) shall not apply with respect to liability for any action taken by COMSAT before the date of enactment of this title.

(c) PARITY OF TREATMENT.-Notwithstanding any other law or executive agreement, the Commission shall have the authority to impose similar regulatory fees on the United States signatory which it imposes on other entities providing similar services.

SEC. 643. [47 U.S.C. 765b] ELIMINATION OF PROCUREMENT PREFERENCES.

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

SEC. 644. [47 U.S.C. 765c] ITU FUNCTIONS.

(a) TECHNICAL COORDINATION.-The Commission and United States satellite companies shall utilize the International Telecommunication Union procedures for technical coordination with INTELSAT and its successor entities and separated entities, rather than INTELSAT procedures.

(b) ITU NOTIFYING ADMINISTRATION.-The President and the Commission shall take the action necessary to ensure that the United States remains the ITU notifying administration for the privatized INTELSAT's existing and future orbital slot registrations.

SEC. 645. [47 U.S.C. 765d] TERMINATION OF COMMUNICATIONS SATELLITE ACT OF 1962 PROVISIONS.

Effective on the dates specified, the following provisions of this Act shall cease to be effective:

(1) Date of enactment of this title: Paragraphs (1), (5) and (6) of section 201(a); section 201(b); paragraphs (1), (3) through

(5), and (8) through (10) of section 201(c); section 303; section 304; section 502; section 503; paragraphs (2) and (4) of section 504(a); and section 504(c).

(2) Upon the transfer of assets to a successor entity and receipt by signatories or former signatories (including COMSAT) of ownership shares in the successor entity of INTELSAT in accordance with appropriate arrangements determined by INTELSAT to implement privatization: Section 305.

(3) On the effective date of a Commission order determining under section 601(b)(2) that Inmarsat privatization is consistent with criteria in sections 621 and 624: Sections 504(b) and 504(d).

(4) On the effective date of a Commission order determining under section 601(b)(2) that INTELSAT privatization is consistent with criteria in sections 621 and 622: Section 102; section 103(7); paragraphs (2) through (4) and (7) of section 201(a); paragraphs (2), (6), and (7) of section 201(c); section 301; section 302; section 401; section 402; section 403; and section 404.

SEC. 646. [47 U.S.C. 765e] REPORTS TO CONGRESS.

(a) ANNUAL REPORTS.-The President and the Commission shall report to the Committees on Commerce and International Relations of the House of Representatives and the Committees on Commerce, Science, and Transportation and Foreign Relations of the Senate within 90 calendar days of the enactment of this title, and not less than annually thereafter, on the progress made to achieve the objectives and carry out the purposes and provisions of this title. Such reports shall be made available immediately to the public.

(b) CONTENTS OF REPORTS.-The reports submitted pursuant to subsection (a) shall include the following:

(1) Progress with respect to each objective since the most

recent preceding report.

(2) Views of the Parties with respect to privatization.

(3) Views of industry and consumers on privatization.

(4) Impact privatization has had on United States industry, United States jobs, and United States industry's access to the global marketplace.

SEC. 647. [47 U.S.C. 765f] SATELLITE AUCTIONS.

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

services.

SEC. 648. [47 U.S.C. 765g] EXCLUSIVITY ARRANGEMENTS.

(a) IN GENERAL.-No satellite operator shall acquire or enjoy the exclusive right of handling telecommunications to or from the United States, its territories or possessions, and any other country or territory by reason of any concession, contract, understanding, or working arrangement to which the satellite operator or any per