Schwab Announces Results Of Annual 1377 Review

by Glen Shapriro, LawAndTax-News.com, New York

10 April 2008

US Trade Representative Susan C. Schwab on Tuesday announced the conclusions of the 2008 annual review of the operation and effectiveness of telecommunications trade agreements under Section 1377 of the Omnibus Trade and Competitiveness Act of 1988.

The 1377 Review identifies barriers facing US telecommunications service and equipment suppliers, evaluates progress towards resolving ongoing problems, and lays out specific telecommunications-related issues on which USTR will focus its efforts this year.

“Open and competitive telecommunications markets are an important element of US trade policy,” explained Ambassador Schwab.

“Barriers that impede US telecommunications operators and equipment manufacturers from effectively competing abroad ultimately hurt the global economy by slowing down innovation, deterring investment, and stifling development. This year’s 1377 Review identifies practices that serve as impediments to achieving our goals of an open and competitive telecommunications market,” she added.

This year’s 1377 Review focused on country-specific concerns, as well as more general issues of concern. Country-specific concerns included:

• Access to Telstra’s telecommunications network in Australia;
• Impediments to market access in China; including high capitalization requirements and limits on joint venture partnerships;
• Problems interconnecting with a major supplier CTE in El Salvador;
• Access to elements of Deutsche Telecom’s network in Germany;
• Continued problems interconnecting with a major supplier Telgua’s network in Guatemala;
• Concerns related to the application and administration of Jamaica’s universal service
  program;
• Telecom equipment testing requirements in Mexico;
• Delays in licensing basic telecommunications services in Oman; and
• Access to leased lines in Singapore.

This year’s 1377 Review also identified general issues of concern in several countries, including:

• Regulatory frameworks that hinder the development of competitive telecommunications markets;
• Elevated mobile termination rates;
• Continued barriers to use of Voice over Internet Protocol (VoIP) technology; and
• Conformity assessment requirements relating to telecommunications and information technology equipment.

In addition to the problems identified in this year’s 1377 Review, USTR also marked progress in key markets on issues identified in past years’ reviews, including:

• Colombia, which drastically reduced its high licensing fee for long distance service that had long served as a barrier to market entry; and,
• India, which eliminated its Access Deficit Charge, a fee that increased the costs to US carriers sending telecommunications traffic to India.

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