|US EU Antitrust Divergence
|11/7. William Kolasky, Deputy Assistant Attorney General in
the Antitrust Division,
gave a speech
titled "Conglomerate Mergers and Range Effects: It is a
Long Way from Chicago to Brussels". He criticized the
EU's rejection of the GE Honeywell merger, and stated that
"we view the EU approach to conglomerate mergers as
inconsistent with the central tenet of U.S. antitrust policy
-- that the antitrust laws protect competition, not
He stated that there is "a sharp divergence between the
U.S. and the EU" in "the reasons we challenge
horizontal and vertical mergers". Specifically, "We
challenge horizontal mergers because they eliminate a
competitor and may thereby enable the merged firm to restrict
output and raise price. Similarly, we challenge vertical
mergers that eliminate a key supplier or customer where doing
so may give the merged firm the ability and incentive to raise
its rivals' costs, again allowing them to restrict output and
raise price. By contrast, in its conglomerate merger
decisions, the EU prohibits mergers because they will make the
merged firm a stronger competitor that may ultimately be able
to drive rivals from the market. Under this scenario the
immediate effect of the merger is to reduce prices and
increase output, with the anti competitive effect occurring
only if the other competitors cannot match the merged firm's
offerings and exit the market."
He said that this divergence is "very troubling for at
least three reasons." First, "there are serious
externalities", because the EU "denies consumers
around the world the benefits the merger might have
delivered." Second, this divergence will "increase
the transactions costs associated with the merger clearance
process. The result may well be to deter mergers that would
have been pro competitive and efficiency enhancing."
Third, it "undermines the strong political consensus
supporting vigorous antitrust enforcement".
|Rep. Cubin Introduces Bill
to Limit Right of Way Costs
|11/8. Rep. Barbara
Cubin (R-WY) introduced HR
3258, the Reasonable Right of Way Fees Act of 2001. The
bill would amend the Federal Lands Policy and Management Act
of 1976 with respect to determining the value of rights of
way. The bill states that its purpose is "to prevent
unreasonable increases in certain costs in connection with the
deployment of communications and other critical
|CompTel Addresses Broadband
Rights of Way
|11/14. The Competitive
Telecommunications Association (CompTel) issued a release
regarding rights of way. It wrote that "The bureaucratic
morass of permits and licenses and building codes has received
less attention than the more visible problems of lack of local
loop competition, but the problems over public rights of way
have created serious paralysis in broadband deployment.
Instead of getting services to customers, providers are
finding themselves stuck in halls of local and state
governments, trying to negotiate through a maze of permit and
CompTel also released a twelve point list titled "Public
Rights of Way Principles". Among its recommendations are
the following: "Rights of way access shall extend to all
entities which provide intrastate, interstate or international
telecommunications or telecommunications services or deploy
facilities used directly or indirectly in the provision of
such telecommunications or telecommunications services. In
exercising its legitimate management authority, a government
entity should ensure that service providers have reasonable
and non-discriminatory access to public rights of way. A
government entity's authority to manage the rights of way
shall not include regulatory control over the providerís
operations and services."
|GAO Releases Report on
Internet Backbone Market
|11/14. The GAO
released a report
[PDF] titled "Characteristics and Competitiveness of the
Internet Backbone Market". The report summarizes the
physical structure of interconnection, and the two types of
financial arrangements for interconnection among backbone
providers -- peering and transit.
The report also states that "No publicly available data
exist to allow a precise economic evaluation of the
competitiveness of the Internet backbone market." It does
relate, however, that industry participants view the backbone
market as competitive, and more competitive now that a few
years ago. The report further recommends that "the FCC
periodically evaluate whether existing data collection efforts
are providing needed information on the Internet backbone
market and, if deemed appropriate, exercise its authority to
establish a more formal data collection program."
The report also states that the "Future evolution of this
market is likely to be largely affected by two types of
emerging services. First, demand is likely to increase for
time sensitive applications, such as Internet voice service.
Second, it is expected that more 'broadband' -- bandwidth
intensive -- content, such as video, will flow over the
Internet in the coming years."
This 43 page report was prepared for Sen. Herb Kohl (D-WI) and Sen. Mike DeWine (R-OH),
the Chairman and ranking Republican, respectively, of the Senate Judiciary
Committee's Subcommittee on Antitrust, Business Rights and
|Senate Holds Hearing on
|11/14. The Senate
Judiciary Committee's Technology, Terrorism, and
Government Information Subcommittee held a hearing on
biometric identifiers. See, prepared testimony of witnesses: Michael
Kirkpatrick (FBI), Monte
Belger (FAA), Valerie
Lyons (Identix), Bill
Willis (Iridian Technologies), Martin
Huddart (Recognition Systems), Richard
Haddock (LaserCard Systems), Joanna
Lau (Lau Technologies). See also, prepared
statement of Sen. Orrin Hatch (R-UT).
|People and Appointments
|11/14. Linda Blair was named Deputy Chief of the
FCC's Enforcement Bureau.
She was previously Associate Chief of the Bureau. She will be
responsible for overseeing the Bureau's regional and field
offices, its Technical and Public Safety Division, and the
broadcast and other Title III responsibilities of the
Investigations and Hearings Division. She will also be a
Deputy on the Commission's new Homeland Security Policy
Council. She has worked for the FCC since 1988.
11/14. Andrew Oosterbaan was named Chief of the Child Exploitation
and Obscenity Section (CEOS) of the Criminal Division of
the Department of Justice. He has worked in the CEOS since
January of 2000. The DOJ stated in a release
the Oosterbaan "helped devise, implement, and manage Operation
Avalanche, a first of its kind undercover initiative
involving unprecedented cooperation between local, state, and
federal law enforcement to protect children in cyberspace by
targeting thousands of subscribers to online child pornography
|Tauzin Dingell Bill News
|11/14. CEOs of 107
telecom companies sent a letter
[PDF] to House Speaker Denny Hastert opposing HR 1542,
the Tauzin Dingell bill, and requesting that it not be brought
to the House floor for a vote. They wrote that "If
enacted into law, its consequences would be devastating for
our New Economy companies and consumers. ... H.R. 1542 could
create the worst possible scenario -- four megacompanies each
possessing an unregulated monopoly over local telephone
services and Internet access."
Robert McCormick, P/CEO of the USTA, a group
that represents ILECs,
released a rebuttal statement.
He argued that "By declaring the market for high speed
Internet services to be a free market, the Tauzin Dingell bill
eliminates the barriers to investment in broadband, unleashing
opportunities throughout the telecom and technology
|WTO Members Agree to Launch
New Round of Trade Negotiations
|11/14. 142 countries participating in the World Trade Organization (WTO)
meeting in Doha, Qatar, adopted a declaration
[PDF] in which they agreed to begin a new round of global
trade negotiations. See, WTO
release. Among the topics to be negotiated are e-commerce,
antitrust policy, trade in services, and TRIPS.
Promoting E-Commerce; Duties on E-Commerce. Paragraph
34 of the declaration states, in full: "We take note of
the work which has been done in the General Council and other
relevant bodies since the Ministerial Declaration of 20 May
1998 and agree to continue the Work Programme on Electronic
Commerce. The work to date demonstrates that electronic
commerce creates new challenges and opportunities for trade
for Members at all stages of development, and we recognize the
importance of creating and maintaining an environment which is
favourable to the future development of electronic commerce.
We instruct the General Council to consider the most
appropriate institutional arrangements for handling the Work
Programme, and to report on further progress to the Fifth
Session of the Ministerial Conference. We declare that Members
will maintain their current practice of not imposing customs
duties on electronic transmissions until the Fifth
Services. Paragraph 15 addresses "negotiations on
trade in services". USTR Robert Zoellick stated that
"In the area of services, we're very pleased, because the
declaration sets the stage for a commencement of negotiations
on new liberalization commitments on sectors that would
include telecommunications, financial services, energy, audio
visuals, express delivery -- but much of the focus is on other
sectors. It's worth recording that these negotiations are
really important to our long-term growth because the service
sector now represents 62 percent of the U.S. economy."
Antitrust Policy as Trade Barrier. Paragraphs 23-25
provide that negotiations will take place on the
"interaction between trade and competition policy".
Paragraph 25 states, in part, that "In the period until
the Fifth Session, further work in the Working Group on the
Interaction between Trade and Competition Policy will focus on
the clarification of: core principles, including transparency,
non-discrimination and procedural fairness, and provisions on
hardcore cartels; modalities for voluntary cooperation; and
support for progressive reinforcement of competition
institutions in developing countries through capacity
TRIPS and Pharmaceutical Patents. Paragraphs 17-19
address the TRIPS Agreement. Paragraph 17 states, in full,
that "We stress the importance we attach to
implementation and interpretation of the Agreement on Trade
Related Aspects of Intellectual Property Rights (TRIPS
Agreement) in a manner supportive of public health, by
promoting both access to existing medicines and research and
development into new medicines and, in this connection, are
adopting a separate Declaration."
Technology Transfers. Paragraph 37 provides that
"We agree to an examination ... of the relationship
between trade and transfer of technology, and of any possible
recommendations on steps that might be taken within the
mandate of the WTO to increase flows of technology to
President Bush. Bush stated that "I commend the
decision by the world's trading nations, meeting in Qatar, to
launch a new round of global trade negotiations. This
bold declaration of hope by the World Trade Organization (WTO)
has the potential to expand prosperity and development
throughout the world and revitalize the global economy. It
also sends a powerful signal that the world's trading nations
support peaceful and open exchange and reject the forces of
fear and protectionism." See, WH
|Rep. Dreier Addresses TPA
|11/13. Rep. David
Dreier (R-CA), Chairman of the House Rules Committee,
spoke in the House in favor of granting the President Trade
Promotion Authority (TPA). He stated that TPA "will allow
us to finally make serious progress in the effort to forge new
trade agreements that benefit our constituents. Without TPA we
can give up any notion of leading the world in opening new
markets, promoting worker protection, and setting
international technological standards. And by refusing to
entrust our negotiators with the authority to move ahead on
trade agreements, we are crippling American industries. ... We
must set aside our differences and recognize that the
compromise embodied in H.R.
3005 will benefit the American people." See,
Congressional Record, Nov. 13, 2001, at page H8037.
|Rep. Brown Addresses TPA
Sherrod Brown (D-OH) spoke in the House against TPA. He
stated that "the Bush administration's trade
representative, Bob Zoellick, sought to link the trade
negotiating authority known as Fast Track to our Nation's
antiterrorism efforts. ... Mr. Zoellick's call for an absolute
trade negotiating authority in the name of patriotism must be
recognized for what it is, pure and simple political
|Fighting Terror with Trade
|11/14. The Progressive
Policy Institute (PPI), a Democratic party think tank,
released a paper
titled "Fighting Terror With Trade". It argues that
many problems in the Middle East derive, not from
globalization, but from lack of globalization and trade in the
The paper, written by Ed Gresser, states that "Some
leftist thinkers have speculated that anti Americanism in the
Middle East has its roots in popular resentment of
globalization. But the facts are the reverse." This PPI
paper elaborates that "Most Middle Eastern countries
maintain trade barriers that are among the highest in the
world. Egypt, for example, imposes a 54 percent tariff on
clothes; Syria bans imports of processed foods, puts a 250
percent tariff on cars, and requires a license for all
The paper continues that many regions of the world that were
recently embroiled in wars and violence have obtained
stability and greater prosperity through trade integration
programs, such as the NAFTA, South America's Mercosur,
European Union, and the Association of Southeast Asian Nations
(ASEAN) Free Trade Area. In contrast, "Middle Eastern
nations have done the opposite by imposing trade restrictions
and sanctions on one another. The high trade barriers common
throughout the Arab world block routine intraregional trade.
The Arab League's boycott of Israel, the region's natural
source of technology and capital, further worsens the
environment." Moreover, "Eleven of the Arab League's
22 members, and Iran as well, remain outside the World Trade
Organization (WTO)." The paper concludes that the U.S.
should encourage Middle Eastern nations to join the WTO, and
negotiate bilateral free trade agreements.
|NTIA Seeks Public Comment
on Broadband Issues
|11/14. The National
Telecommunications and Information Administration (NTIA)
released a copy of a notice
to be published in the Federal Register requesting comments on
deployment of broadband networks and advanced
telecommunications services. The NTIA, which is a part of the Department of Commerce, is one
federal agency involved in developing U.S. telecommunications
and Internet policies.
The notice propounds several dozen questions, including:
"What should be the primary policy considerations in
formulating broadband policy for the country? ... How should
broadband services be defined? ... What is the current status
of (1) supply and (2) demand of broadband services in the
United States?, and Do the interconnection, unbundling, and
resale requirements of the Telecommunications Act of 1996
reduce incumbent local exchange carriers' (ILECs') incentives
to invest in broadband facilities and services?"
Comments will be due within 30 of publication in the Federal
Register, which has not yet happened.
|House Passes Conference
Report on CJS Bill
|11/14. The House passed the conference report on HR
2500 by a vote of 411 to 15. See, Roll
Call No. 438. This is the Commerce, Justice, State, and
the Judiciary Appropriations Act for FY 2002 Conference
Report. This includes funding most of the technology related
agencies and departments, including the USPTO, FCC, FTC, DOJ,
NTIA, NIST, BXA, and SEC.
|Thursday, Nov 15
|8:00 AM - 5:30 PM. Day two of a two day conference hosted by
the Securities and Exchange
Commission (SEC) and Northwestern University Law School
titled Securities Regulation in the Global Internet Economy.
release. Location: Grand Hyatt Hotel, 1000 H Street NW.
8:30 - 11:00 AM. The New Millennium Research Council will host
an event titled "The New State of Competition in the
Telecommunications Industry." For more information,
contact Violet Hobsford at 202 263-2941. Location: Murrow
Room, National Press Club, 529 14th St. NW, 13th Floor.
8:45 AM. FTC Chairman Timothy
Muris will speak at the American Bar Association
Antitrust Section's Fall Forum titled "New Technologies /
New Administrators". Location: Georgetown University Law
9:00 AM. Day one of a two day meeting of the Bureau of Export Administration's
Information Systems Technical Advisory Committee (ISTAC). The
ISTAC advises the Office of the Assistant Secretary for Export
Administration on technical questions that affect the level of
export controls applicable to information systems equipment
and technology. Part of this meeting will be opened to the
public, and part will be closed. The items on the open session
agenda include Intel IA64 Roadmap, Applied Micro Devices (AMD)
Roadmap, ultra wide band (UWB) technology, and membership
coverage of control list categories 3 (electronics), 4
(computers), and 5 (telecommunications and information
security). Location: Hoover Building, Room 3884, 14th Street
between Pennsylvania and Constitution Avenues, NW.
Day one of a three day conference hosted by the Federalist Society titled
"Fifteenth Annual National Lawyer's Convention".
form and agenda.
Location: The Mayflower Hotel, 1127 Connecticut Ave., NW.
AM. The Senate
Judiciary Committee will hold a business meeting.
Location: Room 226, Dirksen Building.
10:00 AM - 12:00 NOON. The FCC's Advisory Committee 2003 for
the World Radiocommunication Conference will hold a meeting.
in Federal Register, October 23, 2001, Vol. 66, No. 205, at
Pages 53608 - 53609. Location: TW-C305 (Commission Meeting
Room), FCC, 445 12th Street, SW.
12:15 PM. The Federal
Communications Bar Association's (FCBA) Common Carrier
Committee will host a brown bag lunch titled "A Blast
from the Past" Views from Former Common Carrier Bureau
Chiefs on Current FCC Common Carrier Policy &
Practice." The speakers will be Epstein, Metzger, Tritt,
and Wallman. Location: Wiley
Rein & Fielding, 1750 K Street, 10th Floor.
1:00 PM. The House
Commerce Committee's Subcommittee on Commerce, Trade, and
Consumer Protection will hold a hearing titled Cyber
Security: Private Sector Efforts Addressing Cyber Threats.
The witnesses will be Howard Schmidt (Microsoft), John
Casciano (SAIC), Christopher Klaus (Internet Security
Systems), Mary Ann Davidson (Oracle), David Morrow (EDS),
Warren Axelrod (Pershing), Dave McCurdy (Electronic Industries
Alliance), and Mark Doll (Ernst & Young). Location: Room
2322, Rayburn Building.
2:00 PM? The U.S. International Telecommunication Advisory
Committee (ITAC) will hold a meeting regarding preparations
for the 2002 World Telecommunication Development Conference (WTDC).
in Federal Register. Location: State Department, Room 1408.
2:00 PM. The House
Judiciary Committee's Subcommittee on Immigration and
Claims will hold a legislative hearing on HR 3231, a bill to
replace the Immigration and Naturalization Service (INS) with
the Agency for Immigration Affairs. Location: Room 2237,
|Friday, Nov 16
|Day two of a three day conference hosted by the Federalist Society titled
"Fifteenth Annual National Lawyer's Convention".
form and agenda.
Theodore Olson, Solicitor General of the United States,
will speak at 1:45 PM. Location: The Mayflower Hotel, 1127
Connecticut Ave., NW.
10:00 AM. The House
Government Reform Committee's Government Efficiency,
Financial Management and Intergovernmental Relations
Subcommittee will hold a hearing titled Oversight Hearing
on National Identification Cards. Location: Room 2154,
|Saturday, Nov 17
|Day three of a three day conference hosted by the Federalist Society titled
"Fifteenth Annual National Lawyer's Convention".
form and agenda.
At 9:30 AM the Telecommunications & Electronic Media Group
will host a panel discussion titled "The FCC Versus the
Constitution: Using Constitutional Norms in the Service of
Telecommunications Reform." The speakers will be Jane Mago (General
Counsel, FCC), Randolph May (Progress
& Freedom Foundation), Andrew Schwartzman (Media Access Project),
Gregory Sidak (American
Enterprise Institute), and Stephen Williams (U.S. Court of
Appeals (DCCir)). Location: Mayflower Hotel, 1127 Connecticut
|Monday, Nov 19
|11:00 AM - 12:00 NOON. The American
Enterprise Institute (AEI) will host an event titled
"Trade Policy Briefing: After Doha - What's Next?"
The speakers will be Claude Barfield, Michael Finger, and
Sarath Rajaptirana. They will analyze the decisions made at
the WTO Ministerial Meeting held November 9-13 in Doha, Qatar.
Location: AEI, 12th Floor, 1150 Seventeenth Street, NW.
|7th Circuit Rules in
|11/14. The U.S.
Court of Appeals (7thCir) issued its opinion
Wakeen Doll Company v. Ashton Drake Galleries,
a copyright infringement case involving "Love Me
Tender" dolls. The Appeals Court affirmed the District
Court's denial of Ashton's JMOL, but
vacated the award of attorneys fees.
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