Many WTO Members Reportedly Noncompliant With Trade Agreements

The European Competitive Telecom Assn. (ECTA) echoed the concerns expressed by CompTel/Ascent (CD Dec 21 p7). It said the 2 major problems affecting trade between the U.S. and Europe were “excessive and discriminatory fixed- to-mobile termination rates and excessive pricing and discriminatory provisioning of local access leased lines.” It said average European fixed-to-mobile termination rates were about 200% higher than available cost estimates, and in some cases they were higher than rates charged to “on- net” customers. ECTA urged the USTR to use the key conclusions of the WTO panel decision in the U.S.-Mexico case (CD June 3 p12) to “finally remove these anti- competitive and illegal market barriers.” It also asked that “USTR to strive for changes to ensure that independent regulation and market opening can finally be implemented in Germany.”

AT&T said high mobile termination rates were “a huge and fast-growing problem,” especially in Belgium, Bulgaria, Denmark, Estonia, Finland, Germany, Greece, Hungary, Iceland, Italy, Netherlands, New Zealand, Peru, Portugal, Romania and Switzerland. The company said the mobile termination rates were often “far higher” than fixed network termination rates in the same foreign market,” even though “there is no legitimate justification for the difference between fixed and mobile termination rates.” It said in many of those countries, it paid 20 cents or more to terminate calls on mobile networks, compared to 2 cents on fixed networks. AT&T said the “calling party pays” (CPP) regime impeded the operation of market forces to reduce rates. Citing an ITU study, the company said average fixed-to-mobile interconnection rates were about 20 times higher under the CPP regime than under “receiving party pays” regime. “Although national regulators have taken some action to address high mobile rates in some of these countries, much more needs to be done by all these countries to comply with their WTO obligations,” it said. AT&T added it remained “very concerned” about continuing market access barriers in India and Mexico.

TIA addressed problems in China, India, Korea and Mexico. The complaints varied by country and included standards-related and conformity assessment problems. It said China didn’t comply with certain WTO telecom services commitments. It complained about China’s “unreasonably high” capitalization requirements for foreign investment in basic telecom services, the continued lack of an independent telecom regulatory authority, and the Chinese govt.’s linkage of 3G license issuance to the “maturity” of the govt.’s preferred standard, TD-SCDMA. TIA also expressed concern about limited availability of undersea cable capacity to and from India, complained about unfair standards development practices with regards to the 2.3 GHz band in Korea, and criticized Mexico for failing to implement its N. American Free Trade Agreement (NAFTA) obligations. “TIA strongly believes that it is important that the United States continue its efforts, both bilaterally and multilaterally, to bring about a fully competitive world market for telecommunications equipment,” it said.

The Information Technology Industry Council (ITI) expressed concerns about regulatory processes for conformity assessment procedures (CAPs) as they apply to electromagnetic compatibility and product safety in Argentina, Brazil, Korea, Mexico and Thailand. “These countries have or are proposing CAPs… that do not allow for SDoC [supplier’s declaration of conformity],” it said: “As a result, requirements such as in country testing, fees and labeling… create significant barriers for importers and threaten trade agreements.”

U.S.-based IDT said it was concerned about its difficulties securing interconnection with several major suppliers in Bangladesh, Cambodia, Egypt, Ethiopia, Gabon, Gambia, Kenya, Laos, Jordan, Mauritania, Morocco, Tanzania and Vietnam. It urged the USTR to “work with its foreign counterparts to encourage these countries to abide by their trade commitments.”

Mexico, Argentina, Brazil and S. Korea “regulatory processes for conformity assessment” aren’t in compliance with the principles of the WTO’s Basic Telecom Agreements and Technical Barriers to Trade Framework, said Avaya, Extreme Networks and Agilent. “This includes the approval of products for electromagnetic compatibility, the application of additional labeling requirements beyond requirements of other WTO members, and refusal to recognize Certification Body scheme product safety testing, forcing in-country product evaluation,” the companies said. They added that such additional requirements created “a substantial burden” to importers for entry of telecom and in some cases nontelecom equipment that’s being classified as telecom in those countries.

“The German government is severely in breach [of] U.S. telecommunications trade agreements in a number of fields,” said Germany-based VoIP provider Indigo Networks. It complained about the lack of an independent regulator in Germany, unreasonable licensing fees for “geographic” phone numbers and lack of RegTP’s action on broadband services. Indigo expressed concern that with the emergence of VoIP market, RegTP had been delaying decisions on a number of key issues, a move that “resembles the lengthy process of unbundling the local loop which effectively stifled competition and led to today’s market share of 90% of Deutsche Telekom [DT] in the broadband access market.” It said given that RegTP holds a significant share in DT, “a conflict of interest must be assumed.”

El Salvador failed to comply with the WTO General Agreement on Trade in Services (GATS), Annex on Telecom and Reference Paper, competitive carrier Aestel said. It said incumbent CTE Telecom didn’t provide Aestel international termination rates available to Americatel El Salvador, in violation of the WTO Reference Paper and Telecom Law in El Salvador. Aestel urged the USTR to work with the El Salvador govt. “to open their markets to competition and to ensure fair and non-discriminatory market conditions in accordance with their international trade commitments.”