SECTION 1. SHORT TITLE; REFERENCES.
     (a) Short Title.--This Act may be cited as the ``Telecommunications Act of 1996''.
     (b) References.--Except as otherwise expressly provided, whenever in this Act an
amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other
provision, the reference shall be considered to be made to a section or other provision of the
Communications Act of 1934 (47 U.S.C. 151 et seq.).  

SEC. 2. TABLE OF CONTENTS.
     The table of contents for this Act is as follows:

Sec. 1. Short title; references.
Sec. 2. Table of contents.
Sec. 3. Definitions.

              TITLE I--TELECOMMUNICATION SERVICES
            Subtitle A--Telecommunications Services
Sec. 101. Establishment of part II of title II.
``Part II--Development of Competitive Markets
  ``Sec. 251. Interconnection.
  ``Sec. 252. Procedures for negotiation, arbitration, and approval of agreements.
  ``Sec. 253. Removal of barriers to entry.
  ``Sec. 254. Universal service.
  ``Sec. 255. Access by persons with disabilities.
  ``Sec. 256. Coordination for interconnectivity.
  ``Sec. 257. Market entry barriers proceeding.
  ``Sec. 258. Illegal changes in subscriber carrier selections.
  ``Sec. 259. Infrastructure sharing.
  ``Sec. 260. Provision of telemessaging service.
  ``Sec. 261. Effect on other requirements.''
Sec. 102. Eligible telecommunications carriers.
Sec. 103. Exempt telecommunications companies.
Sec. 104. Nondiscrimination principle.
Subtitle B--Special Provisions Concerning Bell Operating Companies
Sec. 151. Bell operating company provisions.
``PART III--SPECIAL PROVISIONS CONCERNING BELL OPERATING COMPANIES
  ``Sec. 271. Bell operating company entry into interLATA services.
  ``Sec. 272. Separate affiliate; safeguards.
  ``Sec. 273. Manufacturing by Bell operating companies.
  ``Sec. 274. Electronic publishing by Bell operating companies.
  ``Sec. 275. Alarm monitoring services.
  ``Sec. 276. Provision of payphone service.''
                                
                  TITLE II--BROADCAST SERVICES
Sec. 201. Broadcast spectrum flexibility.
  ``Sec. 336. Broadcast spectrum flexibility.''
Sec. 202. Broadcast ownership.
Sec. 203. Term of licenses.
Sec. 204. Broadcast license renewal procedures.
Sec. 205. Direct broadcast satellite service.
Sec. 206. Automated ship distress and safety systems.
  ``Sec. 365. Automated ship distress and safety systems.''
Sec. 207. Restrictions on over-the-air reception devices.

                   TITLE III--CABLE SERVICES
Sec. 301. Cable Act reform.
Sec. 302. Cable service provided by telephone companies.
``Part V--Video Programming Services Provided by Telephone Companies
  ``Sec. 651. Regulatory treatment of video programming services.
  ``Sec. 652. Prohibition on buy outs.
  ``Sec. 653. Establishment of open video systems.''
Sec. 303. Preemption of franchising authority regulation of telecommunications services.
Sec. 304. Competitive availability of navigation devices.
  ``Sec. 629. Competitive availability of navigation devices.''
Sec. 305. Video programming accessibility.
  ``Sec. 713. Video programming accessibility.''

                  TITLE IV--REGULATORY REFORM
Sec. 401. Regulatory forbearance.
  ``Sec. 10. Competition in provision of telecommunications service.''
Sec. 402. Biennial review of regulations; regulatory relief.
  ``Sec. 11. Regulatory reform.''
Sec. 403. Elimination of unnecessary Commission regulations and functions.

                TITLE V--OBSCENITY AND VIOLENCE
Subtitle A--Obscene, Harassing, and Wrongful Utilization of Telecommunications Facilities
Sec. 501. Short title.
Sec. 502. Obscene or harassing use of telecommunications facilities under the Communications
Act of 1934.
Sec. 503. Obscene programming on cable television.
Sec. 504. Scrambling of cable channels for nonsubscribers.
  ``Sec. 640. Scrambling of cable channels for nonsubscribers.''
Sec. 505. Scrambling of sexually explicit adult video service programming.
  ``Sec. 641. Scrambling of sexually explicit adult video service programming.''
Sec. 506. Cable operator refusal to carry certain programs.
Sec. 507. Clarification of current laws regarding communication of obscene materials through
the use of computers.
Sec. 508. Coercion and enticement of minors.
Sec. 509. Online family empowerment.
  ``Sec. 230. Protection for private blocking and screening of offensive material.''

                      Subtitle B--Violence
Sec. 551. Parental choice in television programming.
Sec. 552. Technology fund.
                  Subtitle C--Judicial Review
Sec. 561. Expedited review.

                 TITLE VI--EFFECT ON OTHER LAWS
Sec. 601. Applicability of consent decrees and other law.
Sec. 602. Preemption of local taxation with respect to direct-to-home services.

              TITLE VII--MISCELLANEOUS PROVISIONS
Sec. 701. Prevention of unfair billing practices for information or services provided over toll-free telephone calls.
Sec. 702. Privacy of customer information.
  ``Sec. 222. Privacy of customer information.''
Sec. 703. Pole attachments.
Sec. 704. Facilities siting; radio frequency emission standards.
Sec. 705. Mobile services direct access to long distance carriers.
Sec. 706. Advanced telecommunications incentives.
Sec. 707. Telecommunications Development Fund.
  ``Sec. 714. Telecommunications Development Fund.''
Sec. 708. National Education Technology Funding Corporation.
Sec. 709. Report on the use of advanced telecommunications services for medical purposes.
Sec. 710. Authorization of appropriations.

SEC. 3. DEFINITIONS.
     (a) Additional Definitions.--Section 3 (47 U.S.C. 153) is amended--
          (1) in subsection (r)--
               (A) by inserting ``(A)'' after ``means''; and
               (B) by inserting before the period at the end the following: ``, or (B)
          comparable service provided through a system of switches, transmission
          equipment, or other facilities (or combination thereof) by which a subscriber can
          originate and terminate a telecommunications service''; and
          (2) by adding at the end thereof the following:
          ``(33) Affiliate.--The term `affiliate' means a person that (directly or indirectly)
     owns or controls, is owned or controlled by, or is under common ownership or control
     with, another person. For purposes of this paragraph, the term `own' means to own an
     equity interest (or the equivalent thereof) of more than 10 percent.
          ``(34) AT&T consent decree.--The term `AT&T Consent Decree' means the
     order entered August 24, 1982, in the antitrust action styled United States v. Western
     Electric, Civil Action No. 82	0192, in the United States District Court for the District of
     Columbia, and includes any judgment or order with respect to such action entered on or
     after August 24, 1982.
          ``(35) Bell operating company.--The term `Bell operating company'--
               ``(A) means any of the following companies: Bell Telephone Company of
          Nevada, Illinois Bell Telephone Company, Indiana Bell Telephone Company,
          Incorporated, Michigan Bell Telephone Company, New England Telephone and
          Telegraph Company, New Jersey Bell Telephone Company, New York Telephone
          Company, U S West Communications Company, South Central Bell Telephone
          Company, Southern Bell Telephone and Telegraph Company, Southwestern Bell
          Telephone Company, The Bell Telephone Company of Pennsylvania, The
          Chesapeake and Potomac Telephone Company, The Chesapeake and Potomac
          Telephone Company of Maryland, The Chesapeake and Potomac Telephone
          Company of Virginia, The Chesapeake and Potomac Telephone Company of
          West Virginia, The Diamond State Telephone Company, The Ohio Bell
          Telephone Company, The Pacific Telephone and Telegraph Company, or
          Wisconsin Telephone Company; and
               ``(B) includes any successor or assign of any such company that provides
          wireline telephone exchange service; but
               ``(C) does not include an affiliate of any such company, other than an
          affiliate described in subparagraph (A) or (B).
          ``(36) Cable service.--The term `cable service' has the meaning given such term
     in section 602.
          ``(37) Cable system.--The term `cable system' has the meaning given such term
     in section 602.
          ``(38) Customer premises equipment.--The term `customer premises equipment'
     means equipment employed on the premises of a person (other than a carrier) to originate,
     route, or terminate telecommunications.
          ``(39) Dialing parity.--The term `dialing parity' means that a person that is not
     an affiliate of a local exchange carrier is able to provide telecommunications services in
     such a manner that customers have the ability to route automatically, without the use of
     any access code, their telecommunications to the telecommunications services provider of
     the customer's designation from among 2 or more telecommunications services providers
     (including such local exchange carrier).
          ``(40) Exchange access.--The term `exchange access' means the offering of
     access to telephone exchange services or facilities for the purpose of the origination or
     termination of telephone toll services.  
          ``(41) Information service.--The term `information service' means the offering
     of a capability for generating, acquiring, storing, transforming, processing, retrieving,
     utilizing, or making available information via telecommunications, and includes
     electronic publishing, but does not include any use of any such capability for the
     management, control, or operation of a telecommunications system or the management of
     a telecommunications service.
          ``(42) Interlata service.--The term `interLATA service' means
     telecommunications between a point located in a local access and transport area and a
     point located outside such area.
          ``(43) Local access and transport area.--The term `local access and transport
     area' or `LATA' means a contiguous geographic area--
               ``(A) established before the date of enactment of the Telecommunications
          Act of 1996 by a Bell operating company such that no exchange area includes
          points within more than 1 metropolitan statistical area, consolidated metropolitan
          statistical area, or State, except as expressly permitted under the AT&T Consent
          Decree; or
               ``(B) established or modified by a Bell operating company after such date
          of enactment and approved by the Commission.
          ``(44) Local exchange carrier.--The term `local exchange carrier' means any
     person that is engaged in the provision of telephone exchange service or exchange access.
     Such term does not include a person insofar as such person is engaged in the provision of
     a commercial mobile service under section 332(c), except to the extent that the
     Commission finds that such service should be included in the definition of such term.
          ``(45) Network element.--The term `network element' means a facility or
     equipment used in the provision of a telecommunications service. Such term also includes
     features, functions, and capabilities that are provided by means of such facility or
     equipment, including subscriber numbers, databases, signaling systems, and information
     sufficient for billing and collection or used in the transmission, routing, or other provision
     of a telecommunications service.
          ``(46) Number portability.--The term `number portability' means the ability of
     users of telecommunications services to retain, at the same location, existing
     telecommunications numbers without impairment of quality, reliability, or convenience
     when switching from one telecommunications carrier to another.
          ``(47) Rural telephone company.--The term `rural telephone company' means a
     local exchange carrier operating entity to the extent that such entity--
               ``(A) provides common carrier service to any local exchange carrier study
          area that does not include either--
                    ``(i) any incorporated place of 10,000 inhabitants or more, or any
               part thereof, based on the most recently available population statistics of
               the Bureau of the Census; or
                    ``(ii) any territory, incorporated or unincorporated, included in an
               urbanized area, as defined by the Bureau of the Census as of August 10,
               1993;
               ``(B) provides telephone exchange service, including exchange access, to
          fewer than 50,000 access lines; 
               ``(C) provides telephone exchange service to any local exchange carrier
          study area with fewer than 100,000 access lines; or
               ``(D) has less than 15 percent of its access lines in communities of more
          than 50,000 on the date of enactment of the Telecommunications Act of 1996.
          ``(48) Telecommunications.--The term `telecommunications' means the
     transmission, between or among points specified by the user, of information of the user's
     choosing, without change in the form or content of the information as sent and received.
          ``(49) Telecommunications carrier.--The term `telecommunications carrier'
     means any provider of telecommunications services, except that such term does not
     include aggregators of telecommunications services (as defined in section 226).  A
     telecommunications carrier shall be treated as a common carrier under this Act only to the
     extent that it is engaged in providing telecommunications services, except that the
     Commission shall determine whether the provision of fixed and mobile satellite service
     shall be treated as common carriage.



          ``(50) Telecommunications equipment.--The term `telecommunications
     equipment' means equipment, other than customer premises equipment, used by a carrier
     to provide telecommunications services, and includes software integral to such equipment
     (including upgrades).
          ``(51) Telecommunications service.--The term `telecommunications service'
     means the offering of telecommunications for a fee directly to the public, or to such
     classes of users as to be effectively available directly to the public, regardless of the
     facilities used.''.
     (b) Common Terminology.--Except as otherwise provided in this Act, the terms used in
this Act have the meanings provided in section 3 of the Communications Act of 1934 (47 U.S.C.
153), as amended by this section.
     (c) Stylistic Consistency.--Section 3 (47 U.S.C. 153) is amended--
          (1) in subsections (e) and (n), by redesignating clauses (1), (2) and (3), as clauses
     (A), (B), and (C), respectively;
          (2) in subsection (w), by redesignating paragraphs (1) through (5) as
     subparagraphs (A) through (E), respectively;
          (3) in subsections (y) and (z), by redesignating paragraphs (1) and (2) as
     subparagraphs (A) and (B), respectively;
          (4) by redesignating subsections (a) through (ff) as paragraphs (1) through (32);
          (5) by indenting such paragraphs 2 em spaces;
          (6) by inserting after the designation of each such paragraph--
               (A) a heading, in a form consistent with the form of the heading of this
          subsection, consisting of the term defined by such paragraph, or the first term so
          defined if such paragraph defines more than one term; and
               (B) the words ``The term''; 
          (7) by changing the first letter of each defined term in such paragraphs from a
     capital to a lower case letter (except for ``United States'', ``State'', ``State commission'',
     and ``Great Lakes Agreement''); and
          (8) by reordering such paragraphs and the additional paragraphs added by
     subsection (a) in alphabetical order based on the headings of such paragraphs and
     renumbering such paragraphs as so reordered.
     (d) Conforming Amendments.--The Act is amended--
          (1) in section 225(a)(1), by striking ``section 3(h)'' and inserting ``section 3'';
          (2) in section 332(d), by striking ``section 3(n)'' each place it appears and inserting
     ``section 3''; and
          (3) in sections 621(d)(3), 636(d), and 637(a)(2), by striking ``section 3(v)'' and
     inserting ``section 3''.

              TITLE I--TELECOMMUNICATION SERVICES
            Subtitle A--Telecommunications Services
                                
SEC. 101. ESTABLISHMENT OF PART II OF TITLE II.
     (a) Amendment.--Title II is amended by inserting after section 229 (47 U.S.C. 229) the
following new part:

``PART II--DEVELOPMENT OF COMPETITIVE MARKETS

``SEC. 251. INTERCONNECTION.
     ``(a) General Duty of Telecommunications Carriers.--Each telecommunications
carrier has the duty--
          ``(1) to interconnect directly or indirectly with the facilities and equipment of
     other telecommunications carriers; and
          ``(2) not to install network features, functions, or capabilities that do not comply
     with the guidelines and standards established pursuant to section 255 or 256.
     ``(b) Obligations of All Local Exchange Carriers.--Each local exchange carrier has
the following duties:
          ``(1) Resale.--The duty not to prohibit, and not to impose unreasonable or
     discriminatory conditions or limitations on, the resale of its telecommunications services.
          ``(2) Number portability.--The duty to provide, to the extent technically
     feasible, number portability in accordance with requirements prescribed by the
     Commission.
          ``(3) Dialing parity.--The duty to provide dialing parity to competing providers
     of telephone exchange service and telephone toll service, and the duty to permit all such
     providers to have nondiscriminatory access to telephone numbers, operator services,
     directory assistance, and directory listing, with no unreasonable dialing delays.
          ``(4) Access to rights-of-way.--The duty to afford access to the poles, ducts,
     conduits, and rights-of-way of such carrier to competing providers of telecommunications
     services on rates, terms, and conditions that are consistent with section 224.
          ``(5) Reciprocal compensation.--The duty to establish reciprocal compensation
     arrangements for the transport and termination of telecommunications.
     ``(c) Additional Obligations of Incumbent Local Exchange Carriers.--In addition
to the duties contained in subsection (b), each incumbent local exchange carrier has the following
duties:
          ``(1) Duty to negotiate.--The duty to negotiate in good faith in accordance with
     section 252 the particular terms and conditions of agreements to fulfill the duties
     described in paragraphs (1) through (5) of subsection (b) and this subsection. The
     requesting telecommunications carrier also has the duty to negotiate in good faith the
     terms and conditions of such agreements.
          ``(2) Interconnection.--The duty to provide, for the facilities and equipment of
     any requesting telecommunications carrier, interconnection with the local exchange
     carrier's network--
               ``(A) for the transmission and routing of telephone exchange service and
          exchange access;
               ``(B) at any technically feasible point within the carrier's network; 
               ``(C) that is at least equal in quality to that provided by the local exchange
          carrier to itself or to any subsidiary, affiliate, or any other party to which the
          carrier provides interconnection; and 
               ``(D) on rates, terms, and conditions that are just, reasonable, and
          nondiscriminatory, in accordance with the terms and conditions of the agreement
          and the requirements of this section and section 252.
          ``(3) Unbundled access.--The duty to provide, to any requesting
     telecommunications carrier for the provision of a telecommunications service,
     nondiscriminatory access to network elements on an unbundled basis at any technically
     feasible point on rates, terms, and conditions that are just, reasonable, and
     nondiscriminatory in accordance with the terms and conditions of the agreement and the
     requirements of this section and section 252. An incumbent local exchange carrier shall
     provide such unbundled network elements in a manner that allows requesting carriers to
     combine such elements in order to provide such telecommunications service.
          ``(4) Resale.--The duty--
               ``(A) to offer for resale at wholesale rates any telecommunications service
          that the carrier provides at retail to subscribers who are not telecommunications
          carriers; and
               ``(B) not to prohibit, and not to impose unreasonable or discriminatory
          conditions or limitations on, the resale of such telecommunications service, except
          that a State commission may, consistent with regulations prescribed by the
          Commission under this section, prohibit a reseller that obtains at wholesale rates a
          telecommunications service that is available at retail only to a category of
          subscribers from offering such service to a different category of subscribers. 
          ``(5) Notice of changes.--The duty to provide reasonable public notice of
     changes in the information necessary for the transmission and routing of services using
     that local exchange carrier's facilities or networks, as well as of any other changes that
     would affect the interoperability of those facilities and networks.
          ``(6) Collocation.--The duty to provide, on rates, terms, and conditions that are
     just, reasonable, and nondiscriminatory, for physical collocation of equipment necessary
     for interconnection or access to unbundled network elements at the premises of the local
     exchange carrier, except that the carrier may provide for virtual collocation if the local
     exchange carrier demonstrates to the State commission that physical collocation is not
     practical for technical reasons or because of space limitations. 
     ``(d) Implementation.--
          ``(1) In general.--Within 6 months after the date of enactment of the
     Telecommunications Act of 1996, the Commission shall complete all actions necessary to
     establish regulations to implement the requirements of this section.  
          ``(2) Access standards.--In determining what network elements should be made
     available for purposes of subsection (c)(3), the Commission shall consider, at a minimum,
     whether--
               ``(A) access to such network elements as are proprietary in nature is
          necessary; and 
               ``(B) the failure to provide access to such network elements would impair
          the ability of the telecommunications carrier seeking access to provide the
          services that it seeks to offer.
          ``(3) Preservation of state access regulations.--In prescribing and
     enforcing regulations to implement the requirements of this section, the Commission
     shall not preclude the enforcement of any regulation, order, or policy of a State
     commission that--
               ``(A) establishes access and interconnection obligations of local exchange
          carriers;
               ``(B) is consistent with the requirements of this section; and
               ``(C) does not substantially prevent implementation of the requirements of
          this section and the purposes of this part.
     ``(e) Numbering Administration.--
          ``(1) Commission authority and jurisdiction.--The Commission shall create
     or designate one or more impartial entities to administer telecommunications numbering
     and to make such numbers available on an equitable basis. The Commission shall have
     exclusive jurisdiction over those portions of the North American Numbering Plan that
     pertain to the United States. Nothing in this paragraph shall preclude the Commission
     from delegating to State commissions or other entities all or any portion of such
     jurisdiction.

          ``(2)  Costs.--The cost of establishing telecommunications numbering
     administration arrangements and number portability shall be borne by all
     telecommunications carriers on a competitively neutral basis as determined by the
     Commission.
     ``(f) Exemptions, Suspensions, and Modifications.--
          ``(1) Exemption for certain rural telephone companies.--
               ``(A) Exemption.--Subsection (c) of this section shall not apply to a rural
          telephone company until (i) such company has received a bona fide request for
          interconnection, services, or network elements, and (ii) the State commission
          determines (under subparagraph (B)) that such request is not unduly economically
          burdensome, is technically feasible, and is consistent with section 254 (other than
          subsections (b)(7) and (c)(1)(D) thereof).
               ``(B) State termination of exemption and implementation
          schedule.--The party making a bona fide request of a rural telephone company
          for interconnection, services, or network elements shall submit a notice of its
          request to the State commission. The State commission shall conduct an inquiry
          for the purpose of determining whether to terminate the exemption under
          subparagraph (A). Within 120 days after the State commission receives notice of
          the request, the State commission shall terminate the exemption if the request is
          not unduly economically burdensome, is technically feasible, and is consistent
          with section 254 (other than subsections (b)(7) and (c)(1)(D) thereof). Upon
          termination of the exemption, a State commission shall establish an
          implementation schedule for compliance with the request that is consistent in time
          and manner with Commission regulations.
               ``(C) Limitation on exemption.--The exemption provided by this
          paragraph shall not apply with respect to a request under subsection (c) from a
          cable operator providing video programming, and seeking to provide any
          telecommunications service, in the area in which the rural telephone company
          provides video programming. The limitation contained in this subparagraph shall
          not apply to a rural telephone company that is providing video programming on
          the date of enactment of the Telecommunications Act of 1996.
          ``(2) Suspensions and modifications for rural carriers.--A local exchange
     carrier with fewer than 2 percent of the Nation's subscriber lines installed in the aggregate
     nationwide may petition a State commission for a suspension or modification of the
     application of a requirement or requirements of subsection (b) or (c) to telephone
     exchange service facilities specified in such petition. The State commission shall grant
     such petition to the extent that, and for such duration as, the State commission determines
     that such suspension or modification--

               ``(A) is necessary--
                    ``(i) to avoid a significant adverse economic impact on users of
               telecommunications services generally; 
                    ``(ii) to avoid imposing a requirement that is unduly economically
               burdensome; or
                    ``(iii) to avoid imposing a requirement that is technically
               infeasible; and 
               ``(B)  is consistent with the public interest, convenience, and necessity.
     The State commission shall act upon any petition filed under this paragraph within 180
     days after receiving such petition. Pending such action, the State commission may
     suspend enforcement of the requirement or requirements to which the petition applies
     with respect to the petitioning carrier or carriers. 
     ``(g) Continued Enforcement of Exchange Access and Interconnection
Requirements.--On and after the date of enactment of the Telecommunications Act of 1996,
each local exchange carrier, to the extent that it provides wireline services, shall provide
exchange access, information access, and exchange services for such access to interexchange
carriers and information service providers in accordance with the same equal access and
nondiscriminatory interconnection restrictions and obligations (including receipt of
compensation) that apply to such carrier on the date immediately preceding the date of enactment
of the Telecommunications Act of 1996 under any court order, consent decree, or regulation,
order, or policy of the Commission, until such restrictions and obligations are explicitly
superseded by regulations prescribed by the Commission after such date of enactment. During
the period beginning on such date of enactment and until such restrictions and obligations are so
superseded, such restrictions and obligations shall be enforceable in the same manner as
regulations of the Commission.
     ``(h) Definition of Incumbent Local Exchange Carrier.--
          ``(1) Definition.--For purposes of this section, the term `incumbent local
     exchange carrier' means, with respect to an area, the local exchange carrier that--
               ``(A) on the date of enactment of the Telecommunications Act of 1996,
          provided telephone exchange service in such area; and
               ``(B)(i) on such date of enactment, was deemed to be a member of the
          exchange carrier association pursuant to section 69.601(b) of the Commission's
          regulations (47 C.F.R. 69.601(b)); or
               ``(ii) is a person or entity that, on or after such date of enactment, became
          a successor or assign of a member described in clause (i).
          ``(2) Treatment of comparable carriers as incumbents.--The Commission
     may, by rule, provide for the treatment of a local exchange carrier (or class or category
     thereof) as an incumbent local exchange carrier for purposes of this section if--
               ``(A) such carrier occupies a position in the market for telephone exchange
          service within an area that is comparable to the position occupied by a carrier
          described in paragraph (1);
               ``(B) such carrier has substantially replaced an incumbent local exchange
          carrier described in paragraph (1); and
               ``(C) such treatment is consistent with the public interest, convenience,
          and necessity and the purposes of this section.
     ``(i) Savings Provision.--Nothing in this section shall be construed to limit or otherwise
affect the Commission's authority under section 201.

``SEC. 252. PROCEDURES FOR NEGOTIATION, ARBITRATION, AND APPROVAL
OF AGREEMENTS.
     ``(a) Agreements Arrived at Through Negotiation.--
          ``(1) Voluntary negotiations.--Upon receiving a request for interconnection,
     services, or network elements pursuant to section 251, an incumbent local exchange
     carrier may negotiate and enter into a binding agreement with the requesting
     telecommunications carrier or carriers without regard to the standards set forth in
     subsections (b) and (c) of section 251. The agreement shall include a detailed schedule of
     itemized charges for interconnection and each service or network element included in the
     agreement. The agreement, including any interconnection agreement negotiated before
     the date of enactment of the Telecommunications Act of 1996, shall be submitted to the
     State commission under subsection (e) of this section.
          ``(2) Mediation.--Any party negotiating an agreement under this section may, at
     any point in the negotiation, ask a State commission to participate in the negotiation and
     to mediate any differences arising in the course of the negotiation.   
     ``(b) Agreements Arrived at Through Compulsory Arbitration.--
          ``(1) arbitration.--During the period from the 135th to the 160th day (inclusive)
     after the date on which an incumbent local exchange carrier receives a request for
     negotiation under this section, the carrier or any other party to the negotiation may
     petition a State commission to arbitrate any open issues.
          ``(2) Duty of petitioner.--
               ``(A) A party that petitions a State commission under paragraph (1) shall,
          at the same time as it submits the petition, provide the State commission all
          relevant documentation concerning--
                    ``(i) the unresolved issues;
                    ``(ii) the position of each of the parties with respect to those issues;
               and
                    ``(iii) any other issue discussed and resolved by the parties.
               ``(B) A party petitioning a State commission under paragraph (1) shall
          provide a copy of the petition and any documentation to the other party or parties
          not later than the day on which the State commission receives the petition.
          ``(3) Opportunity to respond.--A non-petitioning party to a negotiation under
     this section may respond to the other party's petition and provide such additional
     information as it wishes within 25 days after the State commission receives the petition.
          ``(4) Action by state commission.--
               ``(A) The State commission shall limit its consideration of any petition
          under paragraph (1) (and any response thereto) to the issues set forth in the
          petition and in the response, if any, filed under paragraph (3). 
               ``(B) The State commission may require the petitioning party and the
          responding party to provide such information as may be necessary for the State
          commission to reach a decision on the unresolved issues. If any party refuses or
          fails unreasonably to respond on a timely basis to any reasonable request from the
          State commission, then the State commission may proceed on the basis of the best
          information available to it from whatever source derived. 
               ``(C) The State commission shall resolve each issue set forth in the
          petition and the response, if any, by imposing appropriate conditions as required
          to implement subsection (c) upon the parties to the agreement, and shall conclude
          the resolution of any unresolved issues not later than 9 months after the date on
          which the local exchange carrier received the request under this section. 
          ``(5) Refusal to negotiate.--The refusal of any other party to the negotiation to
     participate further in the negotiations, to cooperate with the State commission in carrying
     out its function as an arbitrator, or to continue to negotiate in good faith in the presence,
     or with the assistance, of the State commission shall be considered a failure to negotiate
     in good faith.
     ``(c) Standards for Arbitration.--In resolving by arbitration under subsection (b) any
open issues and imposing conditions upon the parties to the agreement, a State commission shall--
          ``(1) ensure that such resolution and conditions meet the requirements of section
     251, including the regulations prescribed by the Commission pursuant to section 251; 
          ``(2) establish any rates for interconnection, services, or network elements
     according to subsection (d); and
          ``(3) provide a schedule for implementation of the terms and conditions by the
     parties to the agreement.
     ``(d) Pricing Standards.--
          ``(1) Interconnection and network element charges.--Determinations by a
     State commission of the just and reasonable rate for the interconnection of facilities and
     equipment for purposes of subsection (c)(2) of section 251, and the just and reasonable
     rate for network elements for purposes of subsection (c)(3) of such section-- 
               ``(A) shall be-- 
                    ``(i) based on the cost (determined without reference to a rate-of-return or other rate-based proceeding) of providing the interconnection or
               network element (whichever is applicable), and
                    ``(ii) nondiscriminatory, and 
               ``(B) may include a reasonable profit.
          ``(2) Charges for transport and termination of traffic.--
               ``(A) In general.--For the purposes of compliance by an incumbent local
          exchange carrier with section 251(b)(5), a State commission shall not consider the
          terms and conditions for reciprocal compensation to be just and reasonable unless--
                    ``(i) such terms and conditions provide for the mutual and
               reciprocal recovery by each carrier of costs associated with the transport
               and termination on each carrier's network facilities of calls that originate
               on the network facilities of the other carrier; and
                    ``(ii) such terms and conditions determine such costs on the basis
               of a reasonable approximation of the additional costs of terminating such
               calls.
               ``(B) Rules of construction.--This paragraph shall not be construed--
                    ``(i) to preclude arrangements that afford the mutual recovery of
               costs through the offsetting of reciprocal obligations, including
               arrangements that waive mutual recovery (such as bill-and-keep
               arrangements); or
                    ``(ii) to authorize the Commission or any State commission to
               engage in any rate regulation proceeding to establish with particularity the
               additional costs of transporting or terminating calls, or to require carriers
               to maintain records with respect to the additional costs of such calls.
          ``(3) Wholesale prices for telecommunications services.--For the purposes
     of section 251(c)(4), a State commission shall determine wholesale rates on the basis of
     retail rates charged to subscribers for the telecommunications service requested,
     excluding the portion thereof attributable to any marketing, billing, collection, and other
     costs that will be avoided by the local exchange carrier. 
     ``(e) Approval by State Commission.--
          ``(1) Approval required.--Any interconnection agreement adopted by
     negotiation or arbitration shall be submitted for approval to the State commission. A State
     commission to which an agreement is submitted shall approve or reject the agreement,
     with written findings as to any deficiencies.
          ``(2) Grounds for rejection.--The State commission may only reject--
               ``(A) an agreement (or any portion thereof) adopted by negotiation under
          subsection (a) if it finds that--
                    ``(i) the agreement (or portion thereof) discriminates against a
               telecommunications carrier not a party to the agreement; or
                    ``(ii) the implementation of such agreement or portion is not
               consistent with the public interest, convenience, and necessity; or
               ``(B) an agreement (or any portion thereof) adopted by arbitration under
          subsection (b) if it finds that the agreement does not meet the requirements of
          section 251, including the regulations prescribed by the Commission pursuant to
          section 251, or the standards set forth in subsection (d) of this section.
          ``(3) Preservation of authority.--Notwithstanding paragraph (2), but subject
     to section 253, nothing in this section shall prohibit a State commission from establishing
     or enforcing other requirements of State law in its review of an agreement, including
     requiring compliance with intrastate telecommunications service quality standards or
     requirements.
          ``(4) Schedule for decision.--If the State commission does not act to approve or
     reject the agreement within 90 days after submission by the parties of an agreement
     adopted by negotiation under subsection (a), or within 30 days after submission by the
     parties of an agreement adopted by arbitration under subsection (b), the agreement shall
     be deemed approved.  No State court shall have jurisdiction to review the action of a
     State commission in approving or rejecting an agreement under this section.  
          ``(5) Commission to act if state will not act.--If a State commission fails to
     act to carry out its responsibility under this section in any proceeding or other matter
     under this section, then the Commission shall issue an order preempting the State
     commission's jurisdiction of that proceeding or matter within 90 days after being notified
     (or taking notice) of such failure, and shall assume the responsibility of the State
     commission under this section with respect to the proceeding or matter and act for the
     State commission.
          ``(6) Review of state commission actions.--In a case in which a State fails to
     act as described in paragraph (5), the proceeding by the Commission under such
     paragraph and any judicial review of the Commission's actions shall be the exclusive
     remedies for a State commission's failure to act. In any case in which a State commission
     makes a determination under this section, any party aggrieved by such determination may
     bring an action in an appropriate Federal district court to determine whether the
     agreement or statement meets the requirements of section 251 and this section. 
     ``(f) Statements of Generally Available Terms.--
          ``(1) In general.--A Bell operating company may prepare and file with a State
     commission a statement of the terms and conditions that such company generally offers
     within that State to comply with the requirements of section 251 and the regulations
     thereunder and the standards applicable under this section.
          ``(2) State commission review.--A State commission may not approve such
     statement unless such statement complies with subsection (d) of this section and section
     251 and the regulations thereunder. Except as provided in section 253, nothing in this
     section shall prohibit a State commission from establishing or enforcing other
     requirements of State law in its review of such statement, including requiring compliance
     with intrastate telecommunications service quality standards or requirements.
          ``(3) Schedule for review.--The State commission to which a statement is
     submitted shall, not later than 60 days after the date of such submission--
               ``(A) complete the review of such statement under paragraph (2)
          (including any reconsideration thereof), unless the submitting carrier agrees to an
          extension of the period for such review; or
               ``(B) permit such statement to take effect.
          ``(4) Authority to continue review.--Paragraph (3) shall not preclude the State
     commission from continuing to review a statement that has been permitted to take effect
     under subparagraph (B) of such paragraph or from approving or disapproving such
     statement under paragraph (2).
          ``(5) Duty to negotiate not affected.--The submission or approval of a
     statement under this subsection shall not relieve a Bell operating company of its duty to
     negotiate the terms and conditions of an agreement under section 251.
     ``(g) Consolidation of State Proceedings.--Where not inconsistent with the
requirements of this Act, a State commission may, to the extent practical, consolidate
proceedings under sections 214(e), 251(f), 253, and this section in order to reduce administrative
burdens on telecommunications carriers, other parties to the proceedings, and the State
commission in carrying out its responsibilities under this Act.
     ``(h) Filing Required.--A State commission shall make a copy of each agreement
approved under subsection (e) and each statement approved under subsection (f) available for
public inspection and copying within 10 days after the agreement or statement is approved. The
State commission may charge a reasonable and nondiscriminatory fee to the parties to the
agreement or to the party filing the statement to cover the costs of approving and filing such
agreement or statement.
     ``(i) Availability to Other Telecommunications Carriers.--A local exchange
carrier shall make available any interconnection, service, or network element provided under an
agreement approved under this section to which it is a party to any other requesting
telecommunications carrier upon the same terms and conditions as those provided in the
agreement.
     ``(j) Definition of Incumbent Local Exchange Carrier.--For purposes of this
section, the term `incumbent local exchange carrier' has the meaning provided in section 251(h).

``SEC. 253. REMOVAL OF BARRIERS TO ENTRY.
     ``(a) In General.--No State or local statute or regulation, or other State or local legal
requirement, may prohibit or have the effect of prohibiting the ability of any entity to provide
any interstate or intrastate telecommunications service.
     ``(b) State Regulatory Authority.--Nothing in this section shall affect the ability of a
State to impose, on a competitively neutral basis and consistent with section 254, requirements
necessary to preserve and advance universal service, protect the public safety and welfare, ensure
the continued quality of telecommunications services, and safeguard the rights of consumers.
     ``(c) State and Local Government Authority.--Nothing in this section affects the
authority of a State or local government to manage the public rights-of-way  or to require fair and
reasonable compensation from telecommunications providers, on a competitively neutral and
nondiscriminatory basis, for use of public rights-of-way on a nondiscriminatory basis, if the
compensation required is publicly disclosed by such government.
     ``(d) Preemption.--If, after notice and an opportunity for public comment, the
Commission determines that a State or local government has permitted or imposed any statute,
regulation, or legal requirement that violates subsection (a) or (b), the Commission shall preempt
the enforcement of such statute, regulation, or legal requirement to the extent necessary to correct
such violation or inconsistency. 
     ``(e) Commercial mobile service providers.--Nothing in this section shall affect the
application of section 332(c)(3) to commercial mobile service providers. 
     ``(f) Rural Markets.--It shall not be a violation of this section for a State to require a
telecommunications carrier that seeks to provide telephone exchange service or exchange access
in a service area served by a rural telephone company to meet the requirements in section
214(e)(1) for designation as an eligible telecommunications carrier for that area before being
permitted to provide such service. This subsection shall not apply--
          ``(1) to a service area served by a rural telephone company that has obtained an
     exemption, suspension, or modification of section 251(c)(4) that effectively prevents a
     competitor from meeting the requirements of section 214(e)(1); and
          ``(2) to a provider of commercial mobile services.

``SEC. 254. UNIVERSAL SERVICE.
     ``(a) Procedures to Review Universal Service Requirements.--
          ``(1) Federal-state joint board on universal service.--Within one month
     after the date of enactment of the Telecommunications Act of 1996, the Commission
     shall institute and refer to a Federal-State Joint Board under section 410(c) a proceeding
     to recommend changes to any of its regulations in order to implement sections 214(e) and
     this section, including the definition of the services that are supported by Federal
     universal service support mechanisms and a specific timetable for completion of such
     recommendations. In addition to the members of the Joint Board required under section
     410(c), one member of such Joint Board shall be a State-appointed utility consumer
     advocate nominated by a national organization of State utility consumer advocates. The
     Joint Board shall, after notice and opportunity for public comment, make its
     recommendations to the Commission 9 months after the date of enactment of the
     Telecommunications Act of 1996.
          ``(2) Commission action.--The Commission shall initiate a single proceeding to
     implement the recommendations from the Joint Board required by paragraph (1) and shall
     complete such proceeding within 15 months after the date of enactment of the
     Telecommunications Act of 1996. The rules established by such proceeding shall include
     a definition of the services that are supported by Federal universal service support
     mechanisms and a specific timetable for implementation. Thereafter, the Commission
     shall complete any proceeding to implement subsequent recommendations from any Joint
     Board on universal service within one year after receiving such recommendations.
     ``(b) Universal Service Principles.--The Joint Board and the Commission shall base
policies for the preservation and advancement of universal service on the following principles:
          ``(1) Quality and rates.--Quality services should be available at just,
     reasonable, and affordable rates.
          ``(2) Access to advanced services.--Access to advanced telecommunications
     and information services should be provided in all regions of the Nation.
          ``(3) Access in rural and high cost areas.--Consumers in all regions of the
     Nation, including low-income consumers and those in rural, insular, and high cost areas,
     should have access to telecommunications and information services, including
     interexchange services and advanced telecommunications and information services, that
     are reasonably comparable to those services provided in urban areas and that are available
     at rates that are reasonably comparable to rates charged for similar services in urban
     areas.
          ``(4) Equitable and nondiscriminatory contributions.--All providers of
     telecommunications services should make an equitable and nondiscriminatory
     contribution to the preservation and advancement of universal service.
          ``(5) Specific and predictable support mechanisms.--There should be
     specific, predictable and sufficient Federal and State mechanisms to preserve and advance
     universal service.
          ``(6) Access to advanced telecommunications services for schools,
     health care, and libraries.--Elementary and secondary schools and classrooms, health
     care providers, and libraries should have access to advanced telecommunications services
     as described in subsection (h).
          ``(7) Additional principles.--Such other principles as the Joint Board and the
     Commission determine are necessary and appropriate for the protection of the public
     interest, convenience, and necessity and are consistent with this Act.
     ``(c) Definition.--
          ``(1) In general.--Universal service is an evolving level of telecommunications
     services that the Commission shall establish periodically under this section, taking into
     account advances in telecommunications and information technologies and services. The
     Joint Board in recommending, and the Commission in establishing, the definition of the
     services that are supported by Federal universal service support mechanisms shall
     consider the extent to which such telecommunications services--
               ``(A) are essential to education, public health, or public safety;
               ``(B) have, through the operation of market choices by customers, been
          subscribed to by a substantial majority of residential customers;
               ``(C) are being deployed in public telecommunications networks by
          telecommunications carriers; and
               ``(D) are consistent with the public interest, convenience, and necessity.
          ``(2) Alterations and modifications.--The Joint Board may, from time to
     time, recommend to the Commission modifications in the definition of the services that
     are supported by Federal universal service support mechanisms. 
          ``(3) Special services.--In addition to the services included in the definition of
     universal service under paragraph (1), the Commission may designate additional services
     for such support mechanisms for schools, libraries, and health care providers for the
     purposes of subsection (h).
     ``(d) Telecommunications Carrier Contribution.--Every telecommunications carrier
that provides interstate telecommunications services shall contribute, on an equitable and
nondiscriminatory basis, to the specific, predictable, and sufficient mechanisms established by
the Commission to preserve and advance universal service. The Commission may exempt a
carrier or class of carriers from this requirement if the carrier's telecommunications activities are
limited to such an extent that the level of such carrier's contribution to the preservation and
advancement of universal service would be de minimis.  Any other provider of interstate
telecommunications may be required to contribute to the preservation and advancement of
universal service if the public interest so requires.
     ``(e) Universal Service Support.--After the date on which Commission regulations
implementing this section take effect, only an eligible telecommunications carrier designated
under section 214(e) shall be eligible to receive specific Federal universal service support. A
carrier that receives such support shall use that support only for the provision, maintenance, and
upgrading of facilities and services for which the support is intended.  Any such support should
be explicit and sufficient to achieve the purposes of this section.
     ``(f) State Authority.--A State may adopt regulations not inconsistent with the
Commission's rules to preserve and advance universal service. Every telecommunications carrier
that provides intrastate telecommunications services shall contribute, on an equitable and
nondiscriminatory basis, in a manner determined by the State to the preservation and
advancement of universal service in that State.  A State may adopt regulations to provide for
additional definitions and standards to preserve and advance universal service within that State
only to the extent that such regulations adopt additional specific, predictable, and sufficient
mechanisms to support such definitions or standards that do not rely on or burden Federal
universal service support mechanisms.
     ``(g) Interexchange and Interstate Services.--Within 6 months after the date of
enactment of the Telecommunications Act of 1996, the Commission shall adopt rules to require
that the rates charged by providers of interexchange telecommunications services to subscribers
in rural and high cost areas shall be no higher than the rates charged by each such provider to its
subscribers in urban areas. Such rules shall also require that a provider of interstate interexchange
telecommunications services shall provide such services to its subscribers in each State at rates
no higher than the rates charged to its subscribers in any other State.
     ``(h) Telecommunications Services for Certain Providers.--
          ``(1) In general.--
               ``(A) Health care providers for rural areas.--A telecommunications
          carrier shall, upon receiving a bona fide request, provide telecommunications
          services which are necessary for the provision of health care services in a State,
          including instruction relating to such services, to any public or nonprofit health
          care provider that serves persons who reside in rural areas in that State at rates that
          are reasonably comparable to rates charged for similar services in urban areas in
          that State. A telecommunications carrier providing service under this paragraph
          shall be entitled to have an amount equal to the difference, if any, between the
          rates for services provided to health care providers for rural areas in a State and
          the rates for similar services provided to other customers in comparable rural
          areas in that State treated as a service obligation as a part of its obligation to
          participate in the mechanisms to preserve and advance universal service.
               ``(B) Educational providers and libraries.--All telecommunications
          carriers serving a geographic area shall, upon a bona fide request for any of its
          services that are within the definition of universal service under subsection (c)(3),
          provide such services to elementary schools, secondary schools, and libraries for
          educational purposes at rates less than the amounts charged for similar services to
          other parties. The discount shall be an amount that the Commission, with respect
          to interstate services, and the States, with respect to intrastate services, determine
          is appropriate and necessary to ensure affordable access to and use of such
          services by such entities. A telecommunications carrier providing service under
          this paragraph shall--
                    ``(i) have an amount equal to the amount of the discount treated as
               an offset to its obligation to contribute to the mechanisms to preserve and
               advance universal service, or
                    ``(ii) notwithstanding the provisions of subsection (e) of this
               section, receive reimbursement utilizing the support mechanisms to
               preserve and advance universal service.
          ``(2) Advanced services.--The Commission shall establish competitively
     neutral rules--
               ``(A) to enhance, to the extent technically feasible and economically
          reasonable, access to advanced telecommunications and information services for
          all public and nonprofit elementary and secondary school classrooms, health care
          providers, and libraries; and
               ``(B) to define the circumstances under which a telecommunications
          carrier may be required to connect its network to such public institutional
          telecommunications users.
          ``(3) Terms and conditions.--Telecommunications services and network
     capacity provided to a public institutional telecommunications user under this subsection
     may not be sold, resold, or otherwise transferred by such user in consideration for money
     or any other thing of value.
          ``(4) Eligibility of users.--No entity listed in this subsection shall be entitled to
     preferential rates or treatment as required by this subsection, if such entity operates as a
     for-profit business, is a school described in paragraph (5)(A) with an endowment of more
     than $50,000,000, or is a library not eligible for participation in State-based plans for
     funds under title III of the Library Services and Construction Act (20 U.S.C. 335c et
     seq.). 
          ``(5) Definitions.--For purposes of this subsection:
               ``(A) Elementary and secondary schools.--The term `elementary and
          secondary schools' means elementary schools and secondary schools, as defined
          in paragraphs (14) and (25), respectively, of section 14101 of the Elementary and
          Secondary Education Act of 1965 (20 U.S.C. 8801).

               ``(B) Health care provider.--The term `health care provider' means-- 
                    ``(i) post-secondary educational institutions offering health care
               instruction, teaching hospitals, and medical schools;
                    ``(ii) community health centers or health centers providing health
               care to migrants;
                    ``(iii) local health departments or agencies;
                    ``(iv) community mental health centers;
                    ``(v) not-for-profit hospitals;
                    ``(vi) rural health clinics; and
                    ``(vii) consortia of health care providers consisting of one or more
               entities described in clauses (i) through (vi).
               ``(C) Public institutional telecommunications user.--The term
          `public institutional telecommunications user' means an elementary or secondary
          school, a library, or a health care provider as those terms are defined in this
          paragraph.
     ``(i) Consumer Protection.--The Commission and the States should ensure that
universal service is available at rates that are just, reasonable, and affordable.
     ``(j) Lifeline Assistance.--Nothing in this section shall affect the collection,
distribution, or administration of the Lifeline Assistance Program provided for by the
Commission under regulations set forth in section 69.117 of title 47, Code of Federal
Regulations, and other related sections of such title.
     ``(k) Subsidy of Competitive Services Prohibited.--A telecommunications carrier
may not use services that are not competitive to subsidize services that are subject to
competition. The Commission, with respect to interstate services, and the States, with respect to
intrastate services, shall establish any necessary cost allocation rules, accounting safeguards, and
guidelines to ensure that services included in the definition of universal service bear no more
than a reasonable share of the joint and common costs of facilities used to provide those services.

``SEC. 255. ACCESS BY PERSONS WITH DISABILITIES.
     ``(a) Definitions.--As used in this section--
          ``(1) Disability.--The term `disability' has the meaning given to it by section
     3(2)(A) of the Americans with Disabilities Act of 1990 (42 U.S.C. 12102(2)(A)).
          ``(2) Readily achievable.--The term `readily achievable' has the meaning given
     to it by section 301(9) of that Act (42 U.S.C. 12181(9)).
     ``(b) Manufacturing.--A manufacturer of telecommunications equipment or customer
premises equipment shall ensure that the equipment is designed, developed, and fabricated to be
accessible to and usable by individuals with disabilities, if readily achievable.
     ``(c) Telecommunications Services.--A provider of telecommunications service shall
ensure that the service is accessible to and usable by individuals with disabilities, if readily
achievable.
     ``(d) Compatibility.--Whenever the requirements of subsections (b) and (c) are not
readily achievable, such a manufacturer or provider shall ensure that the equipment or service is
compatible with existing peripheral devices or specialized customer premises equipment
commonly used by individuals with disabilities to achieve access, if readily achievable.
     ``(e) Guidelines.--Within 18 months after the date of enactment of the
Telecommunications Act of 1996, the Architectural and Transportation Barriers Compliance
Board shall develop guidelines for accessibility of telecommunications equipment and customer
premises equipment in conjunction with the Commission. The Board shall review and update the
guidelines periodically.
     ``(f) No Additional Private Rights Authorized.--Nothing in this section shall be
construed to authorize any private right of action to enforce any requirement of this section or
any regulation thereunder. The Commission shall have exclusive jurisdiction with respect to any
complaint under this section.

``SEC. 256. COORDINATION FOR INTERCONNECTIVITY.
     ``(a) Purpose.--It is the purpose of this section--
          ``(1) to promote nondiscriminatory accessibility by the broadest number of users
     and vendors of communications products and services to public telecommunications
     networks used to provide telecommunications service through--
               ``(A) coordinated public telecommunications network planning and design
          by telecommunications carriers and other providers of telecommunications
          service; and
               ``(B) public telecommunications network interconnectivity, and
          interconnectivity of devices with such networks used to provide
          telecommunications service; and
          ``(2) to ensure the ability of users and information providers to seamlessly and
     transparently transmit and receive information between and across telecommunications
     networks.
     ``(b) Commission Functions.--In carrying out the purposes of this section, the
Commission--
          ``(1) shall establish procedures for Commission oversight of coordinated network
     planning by telecommunications carriers and other providers of telecommunications
     service for the effective and efficient interconnection of public telecommunications
     networks used to provide telecommunications service; and
          ``(2) may participate, in a manner consistent with its authority and practice prior
     to the date of enactment of this section, in the development by appropriate industry
     standards-setting organizations of public telecommunications network interconnectivity
     standards that promote access to--
               ``(A) public telecommunications networks used to provide
          telecommunications service;
               ``(B) network capabilities and services by individuals with disabilities; and
               ``(C) information services by subscribers of rural telephone companies.
     ``(c) Commission's Authority.--Nothing in this section shall be construed as expanding
or limiting any authority that the Commission may have under law in effect before the date of
enactment of the Telecommunications Act of 1996.
     ``(d) Definition.--As used in this section, the term `public telecommunications network
interconnectivity' means the ability of two or more public telecommunications networks used to
provide telecommunications service to communicate and exchange information without
degeneration, and to interact in concert with one another.

``SEC. 257. MARKET ENTRY BARRIERS PROCEEDING. 
     ``(a) Elimination of Barriers.--Within 15 months after the date of enactment of the
Telecommunications Act of 1996, the Commission shall complete a proceeding for the purpose
of identifying and eliminating, by regulations pursuant to its authority under this Act (other than
this section), market entry barriers for entrepreneurs and other small businesses in the provision
and ownership of telecommunications services and information services, or in the provision of
parts or services to providers of telecommunications services and information services. 
     ``(b) National Policy.--In carrying out subsection (a), the Commission shall seek to
promote the policies and purposes of this Act favoring diversity of media voices, vigorous
economic competition, technological advancement, and promotion of the public interest,
convenience, and necessity.
     ``(c) Periodic Review.--Every 3 years following the completion of the proceeding
required by subsection (a), the Commission shall review and report to Congress on--
          ``(1) any regulations prescribed to eliminate barriers within its jurisdiction that are
     identified under subsection (a) and that can be prescribed consistent with the public
     interest, convenience, and necessity; and
          ``(2) the statutory barriers identified under subsection (a) that the Commission
     recommends be eliminated, consistent with the public interest, convenience, and
     necessity.

``SEC. 258. ILLEGAL CHANGES IN SUBSCRIBER CARRIER SELECTIONS.
     ``(a) Prohibition .--No telecommunications carrier shall submit or execute a change in a
subscriber's selection of a provider of telephone exchange service or telephone toll service except
in accordance with such verification procedures as the Commission shall prescribe. Nothing in
this section shall preclude any State commission from enforcing such procedures with respect to
intrastate services.
     ``(b) Liability for Charges.--Any telecommunications carrier that violates the
verification procedures described in subsection (a) and that collects charges for telephone
exchange service or telephone toll service from a subscriber shall be liable to the carrier
previously selected by the subscriber in an amount equal to all charges paid by such subscriber
after such violation, in accordance with such procedures as the Commission may prescribe. The
remedies provided by this subsection are in addition to any other remedies available by law.

``SEC. 259. INFRASTRUCTURE SHARING.
     ``(a) Regulations Required.--The Commission shall prescribe, within one year after
the date of enactment of the Telecommunications Act of 1996, regulations that require incumbent
local exchange carriers (as defined in section 251(h)) to make available to any qualifying carrier
such public switched network infrastructure, technology, information, and telecommunications
facilities and functions as may be requested by such qualifying carrier for the purpose of enabling
such qualifying carrier to provide telecommunications services, or to provide access to
information services, in the service area in which such qualifying carrier has requested and
obtained designation as an eligible telecommunications carrier under section 214(e). 
     ``(b) Terms and Conditions of Regulations.--The regulations prescribed by the
Commission pursuant to this section shall-- 
          ``(1) not require a local exchange carrier to which this section applies to take any
     action that is economically unreasonable or that is contrary to the public interest; 
          ``(2) permit, but shall not require, the joint ownership or operation of public
     switched network infrastructure and services by or among such local exchange carrier and
     a qualifying carrier; 
          ``(3) ensure that such local exchange carrier will not be treated by the
     Commission or any State as a common carrier for hire or as offering common carrier
     services with respect to any infrastructure, technology, information, facilities, or
     functions made available to a qualifying carrier in accordance with regulations issued
     pursuant to this section; 
          ``(4) ensure that such local exchange carrier makes such infrastructure,
     technology, information, facilities, or functions available to a qualifying carrier on just
     and reasonable terms and conditions that permit such qualifying carrier to fully benefit
     from the economies of scale and scope of such local exchange carrier, as determined in
     accordance with guidelines prescribed by the Commission in regulations issued pursuant
     to this section; 
          ``(5) establish conditions that promote cooperation between local exchange
     carriers to which this section applies and qualifying carriers; 
          ``(6) not require a local exchange carrier to which this section applies to engage in
     any infrastructure sharing agreement for any services or access which are to be provided
     or offered to consumers by the qualifying carrier in such local exchange carrier's
     telephone exchange area; and 
          ``(7) require that such local exchange carrier file with the Commission or State for
     public inspection, any tariffs, contracts, or other arrangements showing the rates, terms,
     and conditions under which such carrier is making available public switched network
     infrastructure and functions under this section.
     ``(c) Information Concerning Deployment of New Services and Equipment.--A
local exchange carrier to which this section applies that has entered into an infrastructure sharing
agreement under this section shall provide to each party to such agreement timely information on
the planned deployment of telecommunications services and equipment, including any software
or upgrades of software integral to the use or operation of such telecommunications equipment.
     ``(d) Definition.--For purposes of this section, the term `qualifying carrier' means a
telecommunications carrier that-- 
          ``(1) lacks economies of scale or scope, as determined in accordance with
     regulations prescribed by the Commission pursuant to this section; and 
          ``(2) offers telephone exchange service, exchange access, and any other service
     that is included in universal service, to all consumers without preference throughout the
     service area for which such carrier has been designated as an eligible telecommunications
     carrier under section 214(e). 

``SEC. 260. PROVISION OF TELEMESSAGING SERVICE.
     ``(a) Nondiscrimination Safeguards.--Any local exchange carrier subject to the
requirements of section 251(c)  that provides telemessaging service--
          ``(1) shall not subsidize its telemessaging service directly or indirectly from its
     telephone exchange service or its exchange access; and
          ``(2) shall not prefer or discriminate in favor of its telemessaging service
     operations in its provision of telecommunications services.
     ``(b) Expedited Consideration of Complaints.--The Commission shall establish
procedures for the receipt and review of complaints concerning violations of subsection (a) or the
regulations thereunder that result in material financial harm to a provider of telemessaging
service. Such procedures shall ensure that the Commission will make a final determination with
respect to any such complaint within 120 days after receipt of the complaint. If the complaint
contains an appropriate showing that the alleged violation occurred, the Commission shall,
within 60 days after receipt of the complaint, order the local exchange carrier and any affiliates to
cease engaging in such violation pending such final determination.
     ``(c) Definition.--As used in this section, the term `telemessaging service' means voice
mail and voice storage and retrieval services, any live operator services used to record,
transcribe, or relay messages (other than telecommunications relay services), and any ancillary
services offered in combination with these services.

``SEC. 261. EFFECT ON OTHER REQUIREMENTS.
     ``(a) Commission Regulations.--Nothing in this part shall be construed to prohibit the
Commission from enforcing regulations prescribed prior to the date of enactment of the
Telecommunications Act of 1996 in fulfilling the requirements of this part, to the extent that
such regulations are not inconsistent with the provisions of this part.
     ``(b) Existing State Regulations.--Nothing in this part shall be construed to prohibit
any State commission from enforcing regulations prescribed prior to the date of enactment of the
Telecommunications Act of 1996, or from prescribing regulations after such date of enactment,
in fulfilling the requirements of this part, if such regulations are not inconsistent with the
provisions of this part.
     ``(c) Additional state requirements.--Nothing in this part precludes a State from
imposing requirements on a telecommunications carrier for intrastate services that are necessary
to further competition in the provision of telephone exchange service or exchange access, as long
as the State's requirements are not inconsistent with this part or the Commission's regulations to
implement this part.''.

     (b) Designation of Part I.--Title II of the Act is further amended by inserting before the
heading of section 201 the following new heading:
``PART I--COMMON CARRIER REGULATION''.
     (c) Stylistic Consistency.--The Act is amended so that--
          (1) the designation and heading of each title of the Act shall be in the form and
     typeface of the designation and heading of this title of this Act; and
          (2) the designation and heading of each part of each title of the Act shall be in the
     form and typeface of the designation and heading of part I of title II of the Act, as
     amended by subsection (a).

SEC. 102. ELIGIBLE TELECOMMUNICATIONS CARRIERS.
     (a) In General.--Section 214 (47 U.S.C. 214) is amended by adding at the end thereof
the following new subsection:
     ``(e) Provision of Universal Service.--
          ``(1) Eligible telecommunications carriers.--A common carrier designated
     as an eligible telecommunications carrier under paragraph (2) or (3) shall be eligible to
     receive universal service support in accordance with section 254 and shall, throughout the
     service area for which the designation is received--
               ``(A) offer the services that are supported by Federal universal service
          support mechanisms under section 254(c), either using its own facilities or a
          combination of its own facilities and resale of another carrier's services (including
          the services offered by another eligible telecommunications carrier); and
               ``(B) advertise the availability of such services and the charges therefor
          using media of general distribution.
          ``(2) Designation of eligible telecommunications carriers.--A State
     commission shall upon its own motion or upon request designate a common carrier that
     meets the requirements of paragraph (1) as an eligible telecommunications carrier for a
     service area designated by the State commission. Upon request and consistent with the
     public interest, convenience, and necessity, the State commission may, in the case of an
     area served by a rural telephone company, and shall, in the case of all other areas,
     designate more than one common carrier as an eligible telecommunications carrier for a
     service area designated by the State commission, so long as each additional requesting
     carrier meets the requirements of paragraph (1). Before designating an additional eligible
     telecommunications carrier for an area served by a rural telephone company, the State
     commission shall find that the designation is in the public interest.
          ``(3) Designation of eligible telecommunications carriers for unserved
     areas.--If no common carrier will provide the services that are supported by Federal
     universal service support mechanisms under section 254(c) to an unserved community or
     any portion thereof that requests such service, the Commission, with respect to interstate
     services, or a State commission, with respect to intrastate services, shall determine which
     common carrier or carriers are best able to provide such service to the requesting
     unserved community or portion thereof and shall order such carrier or carriers to provide
     such service for that unserved community or portion thereof. Any carrier or carriers
     ordered to provide such service under this paragraph shall meet the requirements of
     paragraph (1) and shall be designated as an eligible telecommunications carrier for that
     community or portion thereof.
          ``(4) Relinquishment of universal service.--A State commission shall permit
     an eligible telecommunications carrier to relinquish its designation as such a carrier in
     any area served by more than one eligible telecommunications carrier. An eligible
     telecommunications carrier that seeks to relinquish its eligible telecommunications carrier
     designation for an area served by more than one eligible telecommunications carrier shall
     give advance notice to the State commission of such relinquishment. Prior to permitting a
     telecommunications carrier designated as an eligible telecommunications carrier to cease
     providing universal service in an area served by more than one eligible
     telecommunications carrier, the State commission shall require the remaining eligible
     telecommunications carrier or carriers to ensure that all customers served by the
     relinquishing carrier will continue to be served, and shall require sufficient notice to
     permit the purchase or construction of adequate facilities by any remaining eligible
     telecommunications carrier. The State commission shall establish a time, not to exceed
     one year after the State commission approves such relinquishment under this paragraph,
     within which such purchase or construction shall be completed.
          ``(5) Service area defined.--The term `service area' means a geographic area
     established by a State commission for the purpose of determining universal service
     obligations and support mechanisms. In the case of an area served by a rural telephone
     company, `service area' means such company's `study area' unless and until the
     Commission and the States, after taking into account recommendations of a Federal-State
     Joint Board instituted under section 410(c), establish a different definition of service area
     for such company.''.

SEC. 103. EXEMPT TELECOMMUNICATIONS COMPANIES.
     The Public Utility Holding Company Act of 1935 (15 U.S.C. 79 and following) is
amended by redesignating sections 34 and 35 as sections 35 and 36, respectively, and by
inserting the following new section after section 33:

``SEC. 34. EXEMPT TELECOMMUNICATIONS COMPANIES.
     ``(a) Definitions.--For purposes of this section--
          ``(1) Exempt Telecommunications Company.--The term `exempt
     telecommunications company' means any person determined by the Federal
     Communications Commission to be engaged directly or indirectly, wherever located,
     through one or more affiliates (as defined in section 2(a)(11)(B)), and exclusively in the
     business of providing---
               ``(A) telecommunications services;
               ``(B) information services;
               ``(C) other services or products subject to the jurisdiction of the Federal
          Communications Commission; or
               ``(D) products or services that are related or incidental to the provision of
          a product or service described in subparagraph (A), (B),  or (C).
     No person shall be deemed to be an exempt telecommunications company under this
     section unless such person has applied to the Federal Communications Commission for a
     determination under this paragraph. A person applying in good faith for such a
     determination shall be deemed an exempt telecommunications company under this
     section, with all of the exemptions provided by this section, until the Federal
     Communications Commission makes such determination. The Federal Communications
     Commission shall make such determination within 60 days of its receipt of any such
     application filed after the enactment of this section and shall notify the Commission
     whenever a determination is made under this paragraph that any person is an exempt
     telecommunications company. Not later than 12 months after the date of enactment of
     this section, the Federal Communications Commission shall promulgate rules
     implementing the provisions of this paragraph which shall be applicable to applications
     filed under this paragraph after the effective date of such rules.
          ``(2) Other terms.--For purposes of this section, the terms `telecommunications
     services' and `information services' shall have the same meanings as provided in the
     Communications Act of 1934. 
     ``(b) State Consent for Sale of Existing Rate-Based Facilities.--If a rate or charge
for the sale of electric energy or natural gas (other than any portion of a rate or charge which
represents recovery of the cost of a wholesale rate or charge) for, or in connection with, assets of
a public utility company that is an associate company or affiliate of a registered holding company
was in effect under the laws of any State as of December 19, 1995, the public utility company
owning such assets may not sell such assets to an exempt telecommunications company that is an
associate company or affiliate unless State commissions having jurisdiction over such public
utility company approve such sale.  Nothing in this subsection shall preempt the otherwise
applicable authority of any State to approve or disapprove the sale of such assets. The approval
of the Commission under this Act shall not be required for the sale of assets as provided in this
subsection.
     ``(c) Ownership of ETCS by Exempt Holding Companies.--Notwithstanding any
provision of this Act, a holding company that is exempt under section 3 of this Act shall be
permitted, without condition or limitation under this Act, to acquire and maintain an interest in
the business of one or more exempt telecommunications companies.
     ``(d) Ownership of ETCS by Registered Holding Companies.--Notwithstanding any
provision of this Act, a registered holding company shall be permitted (without the need to apply
for, or receive, approval from the Commission, and otherwise without condition under this Act)
to acquire and hold the securities, or an interest in the business, of one or more exempt
telecommunications companies.
     ``(e) Financing and Other Relationships Between ETCS and Registered Holding
Companies.--The relationship between an exempt telecommunications company and a registered
holding company, its affiliates and associate companies, shall remain subject to the jurisdiction
of the Commission under this Act: Provided, That--
          ``(1) section 11 of this Act shall not prohibit the ownership of an interest in the
     business of one or more exempt telecommunications companies by a registered holding
     company (regardless of activities engaged in or where facilities owned or operated by
     such exempt telecommunications companies are located), and such ownership by a
     registered holding company shall be deemed consistent with the operation of an
     integrated public utility system; 
          ``(2) the ownership of an interest in the business of one or more exempt
     telecommunications companies by a registered holding company (regardless of activities
     engaged in or where facilities owned or operated by such exempt telecommunications
     companies are located) shall be considered as reasonably incidental, or economically
     necessary or appropriate, to the operations of an integrated public utility system; 
          ``(3) the Commission shall have no jurisdiction under this Act over, and there
     shall be no restriction or approval required under this Act with respect to (A) the issue or
     sale of a security by a registered holding company for purposes of financing the
     acquisition of an exempt telecommunications company, or (B) the guarantee of a security
     of an exempt telecommunications company by a registered holding company; and
          ``(4) except for costs that should be fairly and equitably allocated among
     companies that are associate companies of a registered holding company, the
     Commission shall have no jurisdiction under this Act over the sales, service, and
     construction contracts between an exempt telecommunications company and a registered
     holding company, its affiliates and associate companies.
     ``(f) Reporting Obligations Concerning Investments and Activities of
Registered Public-Utility Holding Company Systems.--
          ``(1) Obligations to report information.--Any registered holding company or
     subsidiary thereof that acquires or holds the securities, or an interest in the business, of an
     exempt telecommunications company shall file with the Commission such information as
     the Commission, by rule, may prescribe concerning--
               ``(A) investments and activities by the registered holding company, or any
          subsidiary thereof, with respect to exempt telecommunications companies, and 
               ``(B) any activities of an exempt telecommunications company within the
          holding company system,
     that are reasonably likely to have a material impact on the financial or operational
     condition of the holding company system.
          ``(2) Authority to require additional information.--If, based on reports
     provided to the Commission pursuant to paragraph (1) of this subsection or other
     available information, the Commission reasonably concludes that it has concerns
     regarding the financial or operational condition of any registered holding company or any
     subsidiary thereof (including an exempt telecommunications company), the Commission
     may require such registered holding company to make additional reports and provide
     additional information.
          ``(3) Authority to limit disclosure of information.--Notwithstanding any
     other provision of law, the Commission shall not be compelled to disclose any
     information required to be reported under this subsection. Nothing in this subsection shall
     authorize the Commission to withhold the information from Congress, or prevent the
     Commission from complying with a request for information from any other Federal or
     State department or agency requesting the information for purposes within the scope of
     its jurisdiction. For purposes of section 552 of title 5, United States Code, this subsection
     shall be considered a statute described in subsection (b)(3)(B) of such section 552.
     ``(g) Assumption of Liabilities.--Any public utility company that is an associate
company, or an affiliate, of a registered holding company and that is subject to the jurisdiction of
a State commission with respect to its retail electric or gas rates shall not issue any security for
the purpose of financing the acquisition, ownership, or operation of an exempt
telecommunications company. Any public utility company that is an associate company, or an
affiliate, of a registered holding company and that is subject to the jurisdiction of a State
commission with respect to its retail electric or gas rates shall not assume any obligation or
liability as guarantor, endorser, surety, or otherwise by the public utility company in respect of
any security of an exempt telecommunications company.
     ``(h) Pledging or Mortgaging of Assets.--Any public utility company that is an
associate company, or affiliate, of a registered holding company and that is subject to the
jurisdiction of a State commission with respect to its retail electric or gas rates shall not pledge,
mortgage, or otherwise use as collateral any assets of the public utility company or assets of any
subsidiary company thereof for the benefit of an exempt telecommunications company.
     ``(i) Protection Against Abusive Affiliate Transactions.--A public utility
company may enter into a contract to purchase services or products described in subsection (a)(1)
from an exempt telecommunications company that is an affiliate or associate company of the
public utility company only if--
          ``(1) every State commission having jurisdiction over the retail rates of such
     public utility company approves such contract; or
          ``(2)  such public utility company is not subject to State commission retail rate
     regulation and the purchased services or products--
               ``(A) would not be resold to any affiliate or associate company; or
               ``(B) would be resold to an affiliate or associate company and every State
          commission having jurisdiction over the retail rates of such affiliate or associate
          company makes the determination required by subparagraph (A).
The requirements of this subsection shall not apply in any case in which the State or the State
commission concerned publishes a notice that the State or State commission waives its authority
under this subsection.
     ``(j) Nonpreemption of Rate Authority.--Nothing in this Act shall preclude the
Federal Energy Regulatory Commission or a State commission from exercising its jurisdiction
under otherwise applicable law to determine whether a public utility company may recover in
rates the costs of products or services purchased from or sold to an associate company or affiliate
that is an exempt telecommunications company, regardless of whether such costs are incurred
through the direct or indirect purchase or sale of products or services from such associate
company or affiliate.
     ``(k) Reciprocal Arrangements Prohibited.--Reciprocal arrangements among
companies that are not affiliates or associate companies of each other that are entered into in
order to avoid the provisions of this section are prohibited.
     ``(l) Books and Records.--(1) Upon written order of a State commission, a State
commission may examine the books, accounts, memoranda, contracts, and records of--
          ``(A) a public utility company subject to its regulatory authority under State law;
          ``(B) any exempt telecommunications company selling products or services to
     such public utility company or to an associate company of such public utility company;
     and
          ``(C) any associate company or affiliate of an exempt telecommunications
     company which sells products or services to a public utility company referred to in
     subparagraph (A),
wherever located, if such examination is required for the effective discharge of the State
commission's regulatory responsibilities affecting the provision of electric or gas service in
connection with the activities of such exempt telecommunications company.
     ``(2) Where a State commission issues an order pursuant to paragraph (1), the State
commission shall not publicly disclose trade secrets or sensitive commercial information.
     ``(3) Any United States district court located in the State in which the State commission
referred to in paragraph (1) is located shall have jurisdiction to enforce compliance with this
subsection.
     ``(4) Nothing in this section shall--
          ``(A) preempt applicable State law concerning the provision of records and other
     information; or
          ``(B) in any way limit rights to obtain records and other information under Federal
     law, contracts, or otherwise.
     ``(m) Independent Audit Authority for State Commissions.--
          ``(1) State may order audit.--Any State commission with jurisdiction over a
     public utility company that--------
               ``(A) is an associate company of a registered holding company; and
               ``(B) transacts business, directly or indirectly, with a subsidiary company,
          an affiliate or an associate company that is an exempt telecommunications
          company,
     may order an independent audit to be performed, no more frequently than on an annual
     basis, of all matters deemed relevant by the selected auditor that reasonably relate to retail
     rates: Provided, That such matters relate, directly or indirectly, to transactions or transfers
     between the public utility company subject to its jurisdiction and such exempt
     telecommunications company. 
          ``(2) Selection of firm to conduct audit.--(A) If a State commission orders an
     audit in accordance with paragraph (1), the public utility company and the State
     commission shall jointly select, within 60 days, a firm to perform the audit. The firm
     selected to perform the audit shall possess demonstrated qualifications relating to---
               ``(i) competency, including adequate technical training and professional
          proficiency in each discipline necessary to carry out the audit; and
               ``(ii) independence and objectivity, including that the firm be free from
          personal or external impairments to independence, and should assume an
          independent position with the State commission and auditee, making certain that
          the audit is based upon an impartial consideration of all pertinent facts and
          responsible opinions.
          ``(B) The public utility company and the exempt telecommunications company
     shall cooperate fully with all reasonable requests necessary to perform the audit and the
     public utility company shall bear all costs of having the audit performed.
          ``(3) Availability of auditor's report.--The auditor's report shall be provided
     to the State commission not later than 6 months after the selection of the auditor, and
     provided to the public utility company not later than 60 days thereafter. 
     ``(n) Applicability of Telecommunications Regulation.--Nothing in this section
shall affect the authority of the Federal Communications Commission under the
Communications Act of 1934, or the authority of State commissions under State laws concerning
the provision of telecommunications services, to regulate the activities of an exempt
telecommunications company.''.

SEC. 104. NONDISCRIMINATION PRINCIPLE.
      Section 1 (47 U.S.C.  151) is amended by inserting after ``to all the people of the United
States'' the following: ``, without discrimination on the basis of race, color, religion, national
origin, or sex,''.

    Subtitle B--Special Provisions Concerning Bell Operating
                           Companies
                                
SEC. 151. BELL OPERATING COMPANY PROVISIONS.
     (a) Establishment of Part III of Title II.--Title II is amended by adding at the end of
part II (as added by section 101) the following new part:
    ``PART III--SPECIAL PROVISIONS CONCERNING BELL OPERATING
                           COMPANIES
                                
``SEC. 271. BELL OPERATING COMPANY ENTRY INTO INTERLATA SERVICES.
     ``(a) General Limitation.--Neither a Bell operating company, nor any affiliate of a Bell
operating company, may provide interLATA services except as provided in this section.
     ``(b) InterLATA Services to Which This Section Applies.--
          ``(1) In-region services.--A Bell operating company, or any affiliate of that Bell
     operating company, may provide interLATA services originating in any of its in-region
     States (as defined in subsection (i)) if the Commission approves the application of such
     company for such State under subsection (d)(3). 
          ``(2) Out-of-region services.--A Bell operating company, or any affiliate of
     that Bell operating company, may provide interLATA services originating outside its in-region States after the date of enactment of the Telecommunications Act of 1996, subject
     to subsection (j).
          ``(3) Incidental interlata services.--A Bell operating company, or any
     affiliate of a Bell operating company, may provide incidental interLATA services (as
     defined in subsection (g)) originating in any State after the date of enactment of the
     Telecommunications Act of 1996.
          ``(4) Termination.--Nothing in this section prohibits a Bell operating company
     or any of its affiliates from providing termination for interLATA services, subject to
     subsection (j).
     ``(c) Requirements for Providing Certain In-Region InterLATA Services.--
          ``(1) Agreement or statement.--A Bell operating company meets the
     requirements of this paragraph if it meets the requirements of subparagraph (A) or
     subparagraph (B) of this paragraph for each State for which the authorization is sought.
               ``(A) Presence of a facilities-based competitor.--A Bell operating
          company meets the requirements of this subparagraph if it has entered into one or
          more binding agreements that have been approved under section 252 specifying
          the terms and conditions under which the Bell operating company is providing
          access and interconnection to its network facilities for the network facilities of one
          or more unaffiliated competing providers of telephone exchange service (as
          defined in section 3(47)(A), but excluding exchange access) to residential and
          business subscribers. For the purpose of this subparagraph, such telephone
          exchange service may be offered by such competing providers either exclusively
          over their own telephone exchange service facilities or predominantly over their
          own telephone exchange service facilities in combination with the resale of the
          telecommunications services of another carrier. For the purpose of this
          subparagraph, services provided pursuant to subpart K of part 22 of the
          Commission's regulations (47 C.F.R. 22.901 et seq.) shall not be considered to be
          telephone exchange services.
               ``(B) Failure to request access.--A Bell operating company meets the
          requirements of this subparagraph if, after 10 months after the date of enactment
          of the Telecommunications Act of 1996, no such provider has requested the
          access and interconnection described in subparagraph (A) before the date which is
          3 months before the date the company makes its application under subsection
          (d)(1), and a statement of the terms and conditions that the company generally
          offers to provide such access and interconnection has been approved or permitted
          to take effect by the State commission under section 252(f).  For purposes of this
          subparagraph, a Bell operating company shall be considered not to have received
          any request for access and interconnection if the State commission of such State
          certifies that the only provider or providers making such a request have (i) failed
          to negotiate in good faith as required by section 252, or (ii) violated the terms of
          an agreement approved under section 252 by the provider's failure to comply,
          within a reasonable period of time, with the implementation schedule contained in
          such agreement.
          ``(2) Specific interconnection requirements.--
               ``(A) Agreement required.--A Bell operating company meets the
          requirements of this paragraph if, within the State for which the authorization is
          sought--
                    ``(i)(I) such company is providing access and interconnection
               pursuant to one or more agreements described in paragraph (1)(A), or
                    ``(II) such company is generally offering access and
               interconnection pursuant to a statement described in paragraph (1)(B), and
                    ``(ii) such access and interconnection meets the requirements of
               subparagraph (B) of this paragraph.
               ``(B) Competitive checklist.--Access or interconnection provided or
          generally offered by a Bell operating company to other telecommunications
          carriers meets the requirements of this subparagraph if such access and
          interconnection includes each of the following:
                    ``(i) Interconnection in accordance with the requirements of
               sections 251(c)(2) and 252(d)(1).
                    ``(ii) Nondiscriminatory access to network elements in accordance
               with the requirements of sections 251(c)(3) and 252(d)(1).

                    ``(iii) Nondiscriminatory access to the poles, ducts, conduits, and
               rights-of-way owned or controlled by the Bell operating company at just
               and reasonable rates in accordance  with the requirements of section 224.
                    ``(iv) Local loop transmission from the central office to the
               customer's premises, unbundled from local switching or other services.
                    ``(v) Local transport from the trunk side of a wireline local
               exchange carrier switch unbundled from switching or other services.
                    ``(vi) Local switching unbundled from transport, local loop
               transmission, or other services.
                    ``(vii) Nondiscriminatory access to--
                         ``(I) 911 and E911 services;
                         ``(II) directory assistance services to allow the other
                    carrier's customers to obtain telephone numbers; and
                         ``(III) operator call completion services.
                    ``(viii) White pages directory listings for customers of the other
               carrier's telephone exchange service.
                    ``(ix) Until the date by which telecommunications numbering
               administration guidelines, plan, or rules are established, nondiscriminatory
               access to telephone numbers for assignment to the other carrier's telephone
               exchange service customers. After that date, compliance with such
               guidelines, plan, or rules.
                    ``(x) Nondiscriminatory access to databases and associated
               signaling necessary for call routing and completion.
                    ``(xi) Until the date by which the Commission issues regulations
               pursuant to section 251 to require number portability, interim
               telecommunications number portability through remote call forwarding,
               direct inward dialing trunks, or other comparable arrangements, with as
               little impairment of functioning, quality, reliability, and convenience as
               possible. After that date, full compliance with such regulations.
                    ``(xii) Nondiscriminatory access to such services or information as
               are necessary to allow the requesting carrier to implement local dialing
               parity in accordance with the requirements of section 251(b)(3).
                    ``(xiii) Reciprocal compensation arrangements in accordance with
               the requirements of section 252(d)(2).
                    ``(xiv) Telecommunications services are available for resale in
               accordance with the requirements of sections 251(c)(4) and 252(d)(3).
     ``(d) Administrative Provisions.--
          ``(1) Application to commission.--On and after the date of enactment of the
     Telecommunications Act of 1996, a Bell operating company or its affiliate may apply to
     the Commission for authorization to provide interLATA services originating in any in-region State. The application shall identify each State for which the authorization is
     sought. 
          ``(2) Consultation.--
               ``(A) Consultation with the attorney general.--The Commission
          shall notify the Attorney General promptly of any application under paragraph (1).
          Before making any determination under this subsection, the Commission shall
          consult with the Attorney General, and if the Attorney General submits any
          comments in writing, such comments shall be included in the record of the
          Commission's decision. In consulting with and submitting comments to the
          Commission under this paragraph, the Attorney General shall provide to the
          Commission an evaluation of the application using any standard the Attorney
          General considers appropriate. The Commission shall give substantial weight to
          the Attorney General's evaluation, but such evaluation shall not have any
          preclusive effect on any Commission decision under paragraph (3).
               ``(B) Consultation with state commissions.--Before making any
          determination under this subsection, the Commission shall consult with the State
          commission of any State that is the subject of the application in order to verify the
          compliance of the Bell operating company with the requirements of subsection
          (c).
          ``(3) Determination.--Not later than 90 days after receiving an application under
     paragraph (1), the Commission shall issue a written determination approving or denying
     the authorization requested in the application for each State. The Commission shall not
     approve the authorization requested in an application submitted under paragraph (1)
     unless it finds that--
               ``(A) the petitioning Bell operating company has met the requirements of
          subsection (c)(1) and--
                    ``(i) with respect to access and interconnection provided pursuant
               to subsection (c)(1)(A), has fully implemented the competitive checklist in
               subsection (c)(2)(B); or
                    ``(ii) with respect to access and interconnection generally offered
               pursuant to a statement under subsection (c)(1)(B), such statement offers
               all of the items included in the competitive checklist in subsection
               (c)(2)(B);
               ``(B) the requested authorization will be carried out in accordance with the
          requirements of section 272; and
               ``(C) the requested authorization is consistent with the public interest,
          convenience, and necessity. 
     The Commission shall state the basis for its approval or denial of the application.
          ``(4) Limitation on commission.--The Commission may not, by rule or
     otherwise, limit or extend the terms used in the competitive checklist set forth in
     subsection (c)(2)(B).
          ``(5) Publication.--Not later than 10 days after issuing a determination under
     paragraph (3), the Commission shall publish in the Federal Register a brief description of
     the determination. 
          ``(6) Enforcement of conditions.--
               ``(A) Commission authority.--If at any time after the approval of an
          application under paragraph (3), the Commission determines that a Bell operating
          company has ceased to meet any of the conditions required for such approval, the
          Commission may, after notice and opportunity for a hearing--
                    ``(i) issue an order to such company to correct the deficiency;
                    ``(ii) impose a penalty on such company pursuant to title V; or
                    ``(iii) suspend or revoke such approval.
               ``(B) Receipt and review of complaints.--The Commission shall
          establish procedures for the review of complaints concerning failures by Bell
          operating companies to meet conditions required for approval under paragraph
          (3). Unless the parties otherwise agree, the Commission shall act on such
          complaint within 90 days.
     ``(e) Limitations.--
          ``(1) Joint marketing of local and long distance services.--Until a Bell
     operating company is authorized pursuant to subsection (d) to provide interLATA
     services in an in-region State, or until 36 months have passed since the date of enactment
     of the Telecommunications Act of 1996, whichever is earlier, a telecommunications
     carrier that serves greater than 5 percent of the Nation's presubscribed access lines may
     not jointly market in such State telephone exchange service obtained from such company
     pursuant to section 251(c)(4) with interLATA services offered by that
     telecommunications carrier.
          ``(2) IntraLATA toll dialing parity.--
               ``(A) Provision required.--A Bell operating company granted authority
          to provide interLATA services under subsection (d) shall provide intraLATA toll
          dialing parity throughout that State coincident with its exercise of that authority.
               ``(B) Limitation.--Except for single-LATA States and States that have
          issued an order by December 19, 1995, requiring a Bell operating company to
          implement intraLATA toll dialing parity, a State may not require a Bell operating
          company to implement intraLATA toll dialing parity in that State before a Bell
          operating company has been granted authority under this section to provide
          interLATA services originating in that State or before 3 years after the date of
          enactment of the Telecommunications Act of 1996, whichever is earlier. Nothing
          in this subparagraph precludes a State from issuing an order requiring intraLATA
          toll dialing parity in that State prior to either such date so long as such order does
          not take effect until after the earlier of either such dates.
     ``(f) Exception for Previously Authorized Activities.--Neither subsection (a) nor
section 273 shall prohibit a Bell operating company or affiliate from engaging, at any time after
the date of enactment of the Telecommunications Act of 1996, in any activity to the extent
authorized by, and subject to the terms and conditions contained in, an order entered by the
United States District Court for the District of Columbia pursuant to section VII or VIII(C) of the
AT&T Consent Decree if such order was entered on or before such date of enactment, to the
extent such order is not reversed or vacated on appeal. Nothing in this subsection shall be
construed to limit, or to impose terms or conditions on, an activity in which a Bell operating
company is otherwise authorized to engage under any other provision of this section.
     ``(g) Definition of Incidental InterLATA Services.--For purposes of this section, the
term `incidental interLATA services' means the interLATA provision by a Bell operating
company or its affiliate--

          ``(1)(A) of audio programming, video programming, or other programming
     services to subscribers to such services of such company or affiliate;
          ``(B) of the capability for interaction by such subscribers to select or respond to
     such audio programming, video programming, or other programming services; 
          ``(C) to distributors of audio programming or video programming that such
     company or affiliate owns or controls, or is licensed by the copyright owner of such
     programming (or by an assignee of such owner) to distribute; or
          ``(D) of alarm monitoring services;
          ``(2) of two-way interactive video services or Internet services over dedicated
     facilities to or for elementary and secondary schools as defined in section 254(h)(5);
          ``(3) of commercial mobile services in accordance with section 332(c) of this Act
     and with the regulations prescribed by the Commission pursuant to paragraph (8) of such
     section;
          ``(4) of a service that permits a customer that is located in one LATA to retrieve
     stored information from, or file information for storage in, information storage facilities
     of such company that are located in another LATA;
          ``(5) of signaling information used in connection with the provision of telephone
     exchange services or exchange access by a local exchange carrier; or
          ``(6) of network control signaling information to, and receipt of such signaling
     information from, common carriers offering interLATA services at any location within
     the area in which such Bell operating company provides telephone exchange services or
     exchange access.
     ``(h) Limitations.--The provisions of subsection (g) are intended to be narrowly
construed. The interLATA services provided under subparagraph (A), (B), or (C) of subsection
(g)(1) are limited to those interLATA transmissions incidental to the provision by a Bell
operating company or its affiliate of video, audio, and other programming services that the
company or its affiliate is engaged in providing to the public.  The Commission shall ensure that
the provision of services authorized under subsection (g) by a Bell operating company or its
affiliate will not adversely affect telephone exchange service ratepayers or competition in any
telecommunications market.
     ``(i) Additional Definitions.--As used in this section--
          ``(1) In-region state.--The term `in-region State' means a State in which a Bell
     operating company or any of its affiliates was authorized to provide wireline telephone
     exchange service pursuant to the reorganization plan approved under the AT&T Consent
     Decree, as in effect on the day before the date of enactment of the Telecommunications
     Act of 1996.
          ``(2) Audio programming services.--The term `audio programming services'
     means programming provided by, or generally considered to be comparable to
     programming provided by, a radio broadcast station. 
          ``(3) Video programming services; other programming services.--The terms
     `video programming service' and `other programming services' have the same meanings
     as such terms have under section 602 of this Act.
     ``(j) Certain Service Applications Treated as In-Region Service Applications.--For purposes of this section, a Bell operating company application to provide 800 service, private
line service, or their equivalents that--
          ``(1) terminate in an in-region State of that Bell operating company, and
          ``(2) allow the called party to determine the interLATA carrier,
shall be considered an in-region service subject to the requirements of subsection (b)(1).

``SEC. 272. SEPARATE AFFILIATE; SAFEGUARDS.
     ``(a) Separate Affiliate Required for Competitive Activities.--
          ``(1) In general.--A Bell operating company (including any affiliate) which is a
     local exchange carrier that is subject to the requirements of section 251(c) may not
     provide any service described in paragraph (2) unless it provides that service through one
     or more affiliates that--
               ``(A) are separate from any operating company entity that is subject to the
          requirements of section 251(c); and
               ``(B) meet the requirements of subsection (b).
          ``(2) Services for which a separate affiliate is required.--The services for
     which a separate affiliate is required by paragraph (1) are:
               ``(A) Manufacturing activities (as defined in section 273(h)).
               ``(B) Origination of interLATA telecommunications services, other than--
                    ``(i) incidental interLATA services described in paragraphs (1),
               (2), (3), (5), and (6) of section 271(g);
                    ``(ii) out-of-region services described in section 271(b)(2); or
                    ``(iii) previously authorized activities described in section 271(f).
               ``(C) InterLATA information services, other than electronic publishing (as
          defined in section 274(h)) and alarm monitoring services (as defined in section
          275(e)).
     ``(b) Structural and Transactional Requirements.--The separate affiliate required
by this section-- 
          ``(1) shall operate independently from the Bell operating company;
          ``(2) shall maintain books, records, and accounts in the manner prescribed by the
     Commission which shall be separate from the books, records, and accounts maintained by
     the Bell operating company of which it is an affiliate;
          ``(3) shall have separate officers, directors, and employees from the Bell operating
     company of which it is an affiliate;
          ``(4) may not obtain credit under any arrangement that would permit a creditor,
     upon default, to have recourse to the assets of the Bell operating company; and
          ``(5) shall conduct all transactions with the Bell operating company of which it is
     an affiliate on an arm's length basis with any such transactions reduced to writing and
     available for public inspection.
 ``(c) Nondiscrimination Safeguards.--In its dealings with its affiliate described in subsection
(a), a Bell operating company--
          ``(1) may not discriminate between that company or affiliate and any other entity
     in the provision or procurement of goods, services, facilities, and information, or in the
     establishment of standards; and
          ``(2) shall account for all transactions with an affiliate described in subsection (a)
     in accordance with accounting principles designated or approved by the Commission.
     ``(d) Biennial Audit.--
          ``(1) General requirement.--A company required to operate a separate affiliate
     under this section shall obtain and pay for a joint Federal/State audit every 2 years
     conducted by an independent auditor to determine whether such company has complied
     with this section and the regulations promulgated under this section, and particularly
     whether such company has complied with the separate accounting requirements under
     subsection (b).
          ``(2) Results submitted to commission; state commissions.--The auditor
     described in paragraph (1) shall submit the results of the audit to the Commission and to
     the State commission of each State in which the company audited provides service, which
     shall make such results available for public inspection. Any party may submit comments
     on the final audit report.
          ``(3) Access to documents.--For purposes of conducting audits and reviews
     under this subsection--
               ``(A) the independent auditor, the Commission, and the State commission
          shall have access to the financial accounts and records of each company and of its
          affiliates necessary to verify transactions conducted with that company that are
          relevant to the specific activities permitted under this section and that are
          necessary for the regulation of rates;
               ``(B) the Commission and the State commission shall have access to the
          working papers and supporting materials of any auditor who performs an audit
          under this section; and
               ``(C) the State commission shall implement appropriate procedures to
          ensure the protection of any proprietary information submitted to it under this
          section.
     ``(e) Fulfillment of Certain Requests.--A Bell operating company and an affiliate
that is subject to the requirements of section 251(c)--
          ``(1) shall fulfill any requests from an unaffiliated entity for telephone exchange
     service and exchange access within a period no longer than the period in which it
     provides such telephone exchange service and exchange access to itself or to its affiliates;
          ``(2) shall not provide any facilities, services, or information concerning its
     provision of exchange access to the affiliate described in subsection (a) unless such
     facilities, services, or information are made available to other providers of interLATA
     services in that market on the same terms and conditions;
          ``(3) shall charge the affiliate described in subsection (a), or impute to itself (if
     using the access for its provision of its own services), an amount for access to its
     telephone exchange service and exchange access that is no less than the amount charged
     to any unaffiliated interexchange carriers for such service; and
          ``(4) may provide any interLATA or intraLATA facilities or services to its
     interLATA affiliate if such services or facilities are made available to all carriers at the
     same rates and on the same terms and conditions, and so long as the costs are
     appropriately allocated.
     ``(f) Sunset.--
          ``(1) Manufacturing and long distance.--The provisions of this section (other
     than subsection (e)) shall cease to apply with respect to the manufacturing activities or the
     interLATA telecommunications services of a Bell operating company 3 years after the
     date such Bell operating company or any Bell operating company affiliate is authorized to
     provide interLATA telecommunications services under section 271(d), unless the
     Commission extends such 3-year period by rule or order.
          ``(2) InterLATA information services.--The provisions of this section (other
     than subsection (e)) shall cease to apply with respect to the interLATA information
     services of a Bell operating company 4 years after the date of enactment of the
     Telecommunications Act of 1996, unless the Commission extends such 4-year period by
     rule or order.
          ``(3) Preservation of existing authority.--Nothing in this subsection shall be
     construed to limit the authority of the Commission under any other section of this Act to
     prescribe safeguards consistent with the public interest, convenience, and necessity.
     ``(g) Joint Marketing.--
          ``(1) Affiliate sales of telephone exchange services.--A Bell operating
     company affiliate required by this section may not market or sell telephone exchange
     services provided by the Bell operating company unless that company permits other
     entities offering the same or similar service to market and sell its telephone exchange
     services.
          ``(2) Bell operating company sales of affiliate services.--A Bell operating
     company may not market or sell interLATA service provided by an affiliate required by
     this section within any of its in-region States until such company is authorized to provide
     interLATA services in such State under section 271(d).
          ``(3) Rule of construction.--The joint marketing and sale of services permitted
     under this subsection shall not be considered to violate the nondiscrimination provisions
     of subsection (c).
     ``(h) Transition.--With respect to any activity in which a Bell operating company is
engaged on the date of enactment of the Telecommunications Act of 1996, such company shall
have one year from such date of enactment to comply with the requirements of this section.
``SEC. 273. MANUFACTURING BY BELL OPERATING COMPANIES.
     ``(a) Authorization.--A Bell operating company may manufacture and provide
telecommunications equipment, and manufacture customer premises equipment, if the
Commission authorizes that Bell operating company or any Bell operating company affiliate to
provide interLATA services under section 271(d), subject to the requirements of this section and
the regulations prescribed thereunder, except that neither a Bell operating company nor any of its
affiliates may engage in such manufacturing in conjunction with a Bell operating company not so
affiliated or any of its affiliates.
     ``(b) Collaboration; Research and Royalty Agreements.--
          ``(1) Collaboration.--Subsection (a) shall not prohibit a Bell operating
     company from engaging in close collaboration with any manufacturer of customer
     premises equipment or telecommunications equipment during the design and
     development of hardware, software, or combinations thereof related to such equipment.
          ``(2) Certain research arrangements; royalty agreements.--Subsection
     (a) shall not prohibit a Bell operating company from--
               ``(A) engaging in research activities related to manufacturing, and
               ``(B) entering into royalty agreements with manufacturers of
          telecommunications equipment.
     ``(c) Information Requirements.--
          ``(1) Information on protocols and technical requirements.--Each Bell
     operating company shall, in accordance with regulations prescribed by the Commission,
     maintain and file with the Commission full and complete information with respect to the
     protocols and technical requirements for connection with and use of its telephone
     exchange service facilities.  Each such company shall report promptly to the Commission
     any material changes or planned changes to such protocols and requirements, and the
     schedule for implementation of such changes or planned changes.
          ``(2) Disclosure of information.--A Bell operating company shall not disclose
     any information required to be filed under paragraph (1) unless that information has been
     filed promptly, as required by regulation by the Commission.
          ``(3) Access by competitors to information.--The Commission may prescribe
     such additional regulations under this subsection as may be necessary to ensure that
     manufacturers have access to the information with respect to the protocols and technical
     requirements for connection with and use of telephone exchange service facilities that a
     Bell operating company makes available to any manufacturing affiliate or any
     unaffiliated manufacturer.
          ``(4) Planning information.--Each Bell operating company shall provide, to
     interconnecting carriers providing telephone exchange service, timely information on the
     planned deployment of telecommunications equipment.
     ``(d) Manufacturing Limitations for Standard-Setting Organizations.--
          ``(1) Application to bell communications research or manufacturers.--Bell Communications Research, Inc., or any successor entity or affiliate--
               ``(A) shall not be considered a Bell operating company or a successor or
          assign of a Bell operating company at such time as it is no longer an affiliate of
          any Bell operating company; and
               ``(B) notwithstanding paragraph (3), shall not engage in manufacturing
          telecommunications equipment or customer premises equipment as long as it is an
          affiliate of more than 1 otherwise unaffiliated Bell operating company or
          successor or assign of any such company.
     Nothing in this subsection prohibits Bell Communications Research, Inc., or any
     successor entity, from engaging in any activity in which it is lawfully engaged on the date
     of enactment of the Telecommunications Act of 1996. Nothing provided in this
     subsection shall render Bell Communications Research, Inc., or any successor entity, a
     common carrier under title II of this Act. Nothing in this subsection restricts any
     manufacturer from engaging in any activity in which it is lawfully engaged on the date of
     enactment of the Telecommunications Act of 1996.
          ``(2) Proprietary information.--Any entity which establishes standards for
     telecommunications equipment or customer premises equipment, or generic network
     requirements for such equipment, or certifies telecommunications equipment or customer
     premises equipment, shall be prohibited from releasing or otherwise using any proprietary
     information, designated as such by its owner, in its possession as a result of such activity,
     for any purpose other than purposes authorized in writing by the owner of such
     information, even after such entity ceases to be so engaged.
          ``(3) Manufacturing safeguards.--(A) Except as prohibited in paragraph (1),
     and subject to paragraph (6), any entity which certifies telecommunications equipment or
     customer premises equipment manufactured by an unaffiliated entity shall only
     manufacture a particular class of telecommunications equipment or customer premises
     equipment for which it is undertaking or has undertaken, during the previous 18 months,
     certification activity for such class of equipment through a separate affiliate.
          ``(B) Such separate affiliate shall--
               ``(i) maintain books, records, and accounts separate from those of the
          entity that certifies such equipment, consistent with generally acceptable
          accounting principles;
               ``(ii) not engage in any joint manufacturing activities with such entity; and
               ``(iii) have segregated facilities and separate employees with such entity.
          ``(C) Such entity that certifies such equipment shall--
               ``(i) not discriminate in favor of its manufacturing affiliate in the
          establishment of standards, generic requirements, or product certification;
               ``(ii) not disclose to the manufacturing affiliate any proprietary
          information that has been received at any time from an unaffiliated manufacturer,
          unless authorized in writing by the owner of the information; and
               ``(iii) not permit any employee engaged in product certification for
          telecommunications equipment or customer premises equipment to engage jointly
          in sales or marketing of any such equipment with the affiliated manufacturer.
          ``(4) Standard-setting entities.--Any entity that is not an accredited standards
     development organization and that establishes industry-wide standards for
     telecommunications equipment or customer premises equipment, or industry-wide
     generic network requirements for such equipment, or that certifies telecommunications
     equipment or customer premises equipment manufactured by an unaffiliated entity, shall--
               ``(A) establish and publish any industry-wide standard for, industry-wide
          generic requirement for, or any substantial modification of an existing industry-wide standard or industry-wide generic requirement for, telecommunications
          equipment or customer premises equipment only in compliance with the
          following procedure:
                    ``(i) such entity shall issue a public notice of its consideration of a
               proposed industry-wide standard or industry-wide generic requirement;
                    ``(ii) such entity shall issue a public invitation to interested
               industry parties to fund and participate in such efforts on a reasonable and
               nondiscriminatory basis, administered in such a manner as not to
               unreasonably exclude any interested industry party;
                    ``(iii) such entity shall publish a text for comment by such parties
               as have agreed to participate in the process pursuant to clause (ii), provide
               such parties a full opportunity to submit comments, and respond to
               comments from such parties;
                    ``(iv) such entity shall publish a final text of the industry-wide
               standard or industry-wide generic requirement, including the comments in
               their entirety, of any funding party which requests to have its comments so
               published; and
                    ``(v) such entity shall attempt, prior to publishing a text for
               comment, to agree with the funding parties as a group on a mutually
               satisfactory dispute resolution process which such parties shall utilize as
               their sole recourse in the event of a dispute on technical issues as to which
               there is disagreement between any funding party and the entity conducting
               such activities, except that if no dispute resolution process is agreed to by
               all the parties, a funding party may utilize the dispute resolution
               procedures established pursuant to paragraph (5) of this subsection;
               ``(B) engage in product certification for telecommunications equipment or
          customer premises equipment manufactured by unaffiliated entities only if--
                    ``(i) such activity is performed pursuant to published criteria;
                    ``(ii) such activity is performed pursuant to auditable criteria; and
                    ``(iii) such activity is performed pursuant to available industry-accepted testing methods and standards, where applicable, unless
               otherwise agreed upon by the parties funding and performing such
               activity;
               ``(C) not undertake any actions to monopolize or attempt to monopolize
          the market for such services; and
               ``(D) not preferentially treat its own telecommunications equipment or
          customer premises equipment, or that of its affiliate, over that of any other entity
          in establishing and publishing industry-wide standards or industry-wide generic
          requirements for, and in certification of, telecommunications equipment and
          customer premises equipment.
          ``(5) Alternate dispute resolution.--Within 90 days after the date of
     enactment of the Telecommunications Act of 1996, the Commission shall prescribe a
     dispute resolution process to be utilized in the event that a dispute resolution process is
     not agreed upon by all the parties when establishing and publishing any industry-wide
     standard or industry-wide generic requirement for telecommunications equipment or
     customer premises equipment, pursuant to paragraph (4)(A)(v). The Commission shall
     not establish itself as a party to the dispute resolution process. Such dispute resolution
     process shall permit any funding party to resolve a dispute with the entity conducting the
     activity that significantly affects such funding party's interests, in an open,
     nondiscriminatory, and unbiased fashion, within 30 days after the filing of such dispute.
     Such disputes may be filed within 15 days after the date the funding party receives a
     response to its comments from the entity conducting the activity. The Commission shall
     establish penalties to be assessed for delays caused by referral of frivolous disputes to the
     dispute resolution process.
          ``(6) Sunset.--The requirements of paragraphs (3) and (4) shall terminate for the
     particular relevant activity when the Commission determines that there are alternative
     sources of industry-wide standards, industry-wide generic requirements, or product
     certification for a particular class of telecommunications equipment or customer premises
     equipment available in the United States. Alternative sources shall be deemed to exist
     when such sources provide commercially viable alternatives that are providing such
     services to customers. The Commission shall act on any application for such a
     determination within 90 days after receipt of such application, and shall receive public
     comment on such application.
          ``(7) Administration and enforcement authority.--For the purposes of
     administering this subsection and the regulations prescribed thereunder, the Commission
     shall have the same remedial authority as the Commission has in administering and
     enforcing the provisions of this title with respect to any common carrier subject to this
     Act.
          ``(8) Definitions.--For purposes of this subsection:
               ``(A) The term `affiliate' shall have the same meaning as in section 3 of
          this Act, except that, for purposes of paragraph (1)(B)--
                    ``(i) an aggregate voting equity interest in Bell Communications
               Research, Inc., of at least 5 percent of its total voting equity, owned
               directly or indirectly by more than 1 otherwise unaffiliated Bell operating
               company, shall constitute an affiliate relationship; and
                    ``(ii) a voting equity interest in Bell Communications Research,
               Inc., by any otherwise unaffiliated Bell operating company of less than 1
               percent of Bell Communications Research's total voting equity shall not be
               considered to be an equity interest under this paragraph.
               ``(B) The term `generic requirement' means a description of acceptable
          product attributes for use by local exchange carriers in establishing product
          specifications for the purchase of telecommunications equipment, customer
          premises equipment, and software integral thereto.
               ``(C) The term `industry-wide' means activities funded by or performed on
          behalf of local exchange carriers for use in providing wireline telephone exchange
          service whose combined total of deployed access lines in the United States
          constitutes at least 30 percent of all access lines deployed by telecommunications
          carriers in the United States as of the date of enactment of the
          Telecommunications Act of 1996.
               ``(D) The term `certification' means any technical process whereby a party
          determines whether a product, for use by more than one local exchange carrier,
          conforms with the specified requirements pertaining to such product.
               ``(E) The term `accredited standards development organization' means an
          entity composed of industry members which has been accredited by an institution
          vested with the responsibility for standards accreditation by the industry.
     ``(e) Bell Operating Company Equipment Procurement and Sales.--
          ``(1) Nondiscrimination standards for manufacturing.--In the procurement
     or awarding of supply contracts for telecommunications equipment, a Bell operating
     company, or any entity acting on its behalf, for the duration of the requirement for a
     separate subsidiary including manufacturing under this Act--
               ``(A) shall consider such equipment, produced or supplied by unrelated
          persons; and
               ``(B) may not discriminate in favor of equipment produced or supplied by
          an affiliate or related person.
          ``(2) Procurement standards.--Each Bell operating company or any entity
     acting on its behalf shall make procurement decisions and award all supply contracts for
     equipment, services, and software on the basis of an objective assessment of price,
     qualify, delivery, and other commercial factors.
          ``(3) Network planning and design.--A Bell operating company shall, to the
     extent consistent with the antitrust laws, engage in joint network planning and design
     with local exchange carriers operating in the same area of interest.  No participant in such
     planning shall be allowed to delay the introduction of new technology or the deployment
     of facilities to provide telecommunications services, and agreement with such other
     carriers shall not be required as a prerequisite for such introduction or deployment. 
          ``(4) Sales restrictions.--Neither a Bell operating company engaged in
     manufacturing nor a manufacturing affiliate of such a company shall restrict sales to any
     local exchange carrier of telecommunications equipment, including software integral to
     the operation of such equipment and related upgrades.
          ``(5) Protection of proprietary information.--A Bell operating company and
     any entity it owns or otherwise controls shall protect the proprietary information
     submitted for procurement decisions from release not specifically authorized by the
     owner of such information.
     ``(f) Administration and Enforcement Authority.--For the purposes of
administering and enforcing the provisions of this section and the regulations prescribed
thereunder, the Commission shall have the same authority, power, and functions with respect to
any Bell operating company or any affiliate thereof as the Commission has in administering and
enforcing the provisions of this title with respect to any common carrier subject to this Act.
     ``(g) Additional Rules and Regulations.--The Commission may prescribe such
additional rules and regulations as the Commission determines are necessary to carry out the
provisions of this section, and otherwise to prevent discrimination and cross-subsidization in a
Bell operating company's dealings with its affiliate and with third parties.
     ``(h) Definition.--As used in this section, the term `manufacturing' has the same
meaning as such term has under the AT&T Consent Decree.

``SEC. 274. ELECTRONIC PUBLISHING BY BELL OPERATING COMPANIES.
     ``(a) Limitations.--No Bell operating company or any affiliate may engage in the
provision of electronic publishing that is disseminated by means of such Bell operating
company's or any of its affiliates' basic telephone service, except that nothing in this section shall
prohibit a separated affiliate or electronic publishing joint venture operated in accordance with
this section from engaging in the provision of electronic publishing.
     ``(b) Separated Affiliate or Electronic Publishing Joint Venture
Requirements.--A separated affiliate or electronic publishing joint venture shall be operated
independently from the Bell operating company. Such separated affiliate or joint venture and the
Bell operating company with which it is affiliated shall--
          ``(1) maintain separate books, records, and accounts and prepare separate financial
     statements;
          ``(2) not incur debt in a manner that would permit a creditor of the separated
     affiliate or joint venture upon default to have recourse to the assets of the Bell operating
     company;
          ``(3) carry out transactions (A) in a manner consistent with such independence,
     (B) pursuant to written contracts or tariffs that are filed with the Commission and made
     publicly available, and (C) in a manner that is auditable in accordance with generally
     accepted auditing standards;
          ``(4) value any assets that are transferred directly or indirectly from the Bell
     operating company to a separated affiliate or joint venture, and record any transactions by
     which such assets are transferred, in accordance with such regulations as may be
     prescribed by the Commission or a State commission to prevent improper cross subsidies;
          ``(5) between a separated affiliate and a Bell operating company--
               ``(A) have no officers, directors, and employees in common after the
          effective date of this section; and
               ``(B) own no property in common;
          ``(6) not use for the marketing of any product or service of the separated affiliate
     or joint venture, the name, trademarks, or service marks of an existing Bell operating
     company except for names, trademarks, or service marks that are owned by the entity that
     owns or controls the Bell operating company;
          ``(7) not permit the Bell operating company--
               ``(A) to perform hiring or training of personnel on behalf of a separated
          affiliate;
               ``(B) to perform the purchasing, installation, or maintenance of equipment
          on behalf of a separated affiliate, except for telephone service that it provides
          under tariff or contract subject to the provisions of this section; or
               ``(C) to perform research and development on behalf of a separated
          affiliate;
          ``(8) each have performed annually a compliance review--
               ``(A) that is conducted by an independent entity for the purpose of
          determining compliance during the preceding calendar year with any provision of
          this section; and
               ``(B) the results of which are maintained by the separated affiliate or joint
          venture and the Bell operating company for a period of 5 years subject to review
          by any lawful authority; and
          ``(9) within 90 days of receiving a review described in paragraph (8), file a report
     of any exceptions and corrective action with the Commission and allow any person to
     inspect and copy such report subject to reasonable safeguards to protect any proprietary
     information contained in such report from being used for purposes other than to enforce
     or pursue remedies under this section.
     ``(c) Joint Marketing.--
          ``(1) In general.--Except as provided in paragraph (2)--
               ``(A) a Bell operating company shall not carry out any promotion,
          marketing, sales, or advertising for or in conjunction with a separated affiliate;
          and
               ``(B) a Bell operating company shall not carry out any promotion,
          marketing, sales, or advertising for or in conjunction with an affiliate that is
          related to the provision of electronic publishing.
          ``(2) Permissible joint activities.--
               ``(A) Joint telemarketing.--A Bell operating company may provide
          inbound telemarketing or referral services related to the provision of electronic
          publishing for a separated affiliate, electronic publishing joint venture, affiliate, or
          unaffiliated electronic publisher, provided that if such services are provided to a
          separated affiliate, electronic publishing joint venture, or affiliate, such services
          shall be made available to all electronic publishers on request, on
          nondiscriminatory terms.
               ``(B) Teaming arrangements.--A Bell operating company may engage
          in nondiscriminatory teaming or business arrangements to engage in electronic
          publishing with any separated affiliate or with any other electronic publisher if (i)
          the Bell operating company only provides facilities, services, and basic telephone
          service information as authorized by this section, and (ii) the Bell operating
          company does not own such teaming or business arrangement.
               ``(C) Electronic publishing joint ventures.--A Bell operating
          company or affiliate may participate on a nonexclusive basis in electronic
          publishing joint ventures with entities that are not a Bell operating company,
          affiliate, or separated affiliate to provide electronic publishing services, if the Bell
          operating company or affiliate has not more than a 50 percent direct or indirect
          equity interest (or the equivalent thereof) or the right to more than 50 percent of
          the gross revenues under a revenue sharing or royalty agreement in any electronic
          publishing joint venture. Officers and employees of a Bell operating company or
          affiliate participating in an electronic publishing joint venture may not have more
          than 50 percent of the voting control over the electronic publishing joint venture.
          In the case of joint ventures with small, local electronic publishers, the
          Commission for good cause shown may authorize the Bell operating company or
          affiliate to have a larger equity interest, revenue share, or voting control but not to
          exceed 80 percent. A Bell operating company participating in an electronic
          publishing joint venture may provide promotion, marketing, sales, or advertising
          personnel and services to such joint venture.
     ``(d) Bell Operating Company Requirement.--A Bell operating company under
common ownership or control with a separated affiliate or electronic publishing joint venture
shall provide network access and interconnections for basic telephone service to electronic
publishers at just and reasonable rates that are tariffed (so long as rates for such services are
subject to regulation) and that are not higher on a per-unit basis than those charged for such
services to any other electronic publisher or any separated affiliate engaged in electronic
publishing.
     ``(e) Private Right of Action.--
          ``(1) Damages.--Any person claiming that any act or practice of any Bell
     operating company, affiliate, or separated affiliate constitutes a violation of this section
     may file a complaint with the Commission or bring suit as provided in section 207 of this
     Act, and such Bell operating company, affiliate, or separated affiliate shall be liable as
     provided in section 206 of this Act; except that damages may not be awarded for a
     violation that is discovered by a compliance review as required by subsection (b)(7) of
     this section and corrected within 90 days.
          ``(2) Cease and desist orders.--In addition to the provisions of paragraph (1),
     any person claiming that any act or practice of any Bell operating company, affiliate, or
     separated affiliate constitutes a violation of this section may make application to the
     Commission for an order to cease and desist such violation or may make application in
     any district court of the United States of competent jurisdiction for an order enjoining
     such acts or practices or for an order compelling compliance with such requirement.
     ``(f) Separated Affiliate Reporting Requirement.--Any separated affiliate under this
section shall file with the Commission annual reports in a form substantially equivalent to the
Form 10	K required by regulations of the Securities and Exchange Commission.
     ``(g) Effective Dates.--
          ``(1) Transition.--Any electronic publishing service being offered to the public
     by a Bell operating company or affiliate on the date of enactment of the
     Telecommunications Act of 1996 shall have one year from such date of enactment to
     comply with the requirements of this section.
          ``(2) Sunset.--The provisions of this section shall not apply to conduct occurring
     after 4 years after the date of enactment of the Telecommunications Act of 1996.
     ``(h) Definition of Electronic Publishing.--
          ``(1) In general.--The term `electronic publishing' means the dissemination,
     provision, publication, or sale to an unaffiliated entity or person, of any one or more of
     the following: news (including sports); entertainment (other than interactive games);
     business, financial, legal, consumer, or credit materials; editorials, columns, or features;
     advertising; photos or images; archival or research material; legal notices or public
     records; scientific, educational, instructional, technical, professional, trade, or other
     literary materials; or other like or similar information.
          ``(2) Exceptions.--The term `electronic publishing' shall not include the
     following services: 
               ``(A) Information access, as that term is defined by the AT&T Consent
          Decree.
               ``(B) The transmission of information as a common carrier.
               ``(C) The transmission of information as part of a gateway to an
          information service that does not involve the generation or alteration of the
          content of information, including data transmission, address translation, protocol
          conversion, billing management, introductory information content, and
          navigational systems that enable users to access electronic publishing services,
          which do not affect the presentation of such electronic publishing services to
          users. 
               ``(D) Voice storage and retrieval services, including voice messaging and
          electronic mail services.
               ``(E) Data processing or transaction processing services that do not
          involve the generation or alteration of the content of information.
               ``(F) Electronic billing or advertising of a Bell operating company's
          regulated telecommunications services.
               ``(G) Language translation or data format conversion.
               ``(H) The provision of information necessary for the management, control,
          or operation of a telephone company telecommunications system.
               ``(I) The provision of directory assistance that provides names, addresses,
          and telephone numbers and does not include advertising.
               ``(J) Caller identification services.
               ``(K) Repair and provisioning databases and credit card and billing
          validation for telephone company operations.
               ``(L) 911	E and other emergency assistance databases.
               ``(M) Any other network service of a type that is like or similar to these
          network services and that does not involve the generation or alteration of the
          content of information.
               ``(N) Any upgrades to these network services that do not involve the
          generation or alteration of the content of information.
               ``(O) Video programming or full motion video entertainment on demand.
     ``(i) Additional Definitions.--As used in this section--
          ``(1) The term `affiliate' means any entity that, directly or indirectly, owns or
     controls, is owned or controlled by, or is under common ownership or control with, a Bell
     operating company. Such term shall not include a separated affiliate. 
          ``(2) The term `basic telephone service' means any wireline telephone exchange
     service, or wireline telephone exchange service facility, provided by a Bell operating
     company in a telephone exchange area, except that such term does not include--
               ``(A) a competitive wireline telephone exchange service provided in a
          telephone exchange area where another entity provides a wireline telephone
          exchange service that was provided on January 1, 1984, or
               ``(B) a commercial mobile service.
          ``(3) The term `basic telephone service information' means network and customer
     information of a Bell operating company and other information acquired by a Bell
     operating company as a result of its engaging in the provision of basic telephone service.
          ``(4) The term `control' has the meaning that it has in 17 C.F.R. 240.12b	2, the
     regulations promulgated by the Securities and Exchange Commission pursuant to the
     Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) or any successor provision to
     such section.
          ``(5) The term `electronic publishing joint venture' means a joint venture owned
     by a Bell operating company or affiliate that engages in the provision of electronic
     publishing which is disseminated by means of such Bell operating company's or any of its
     affiliates' basic telephone service.
          ``(6) The term `entity' means any organization, and includes corporations,
     partnerships, sole proprietorships, associations, and joint ventures.
          ``(7) The term `inbound telemarketing' means the marketing of property, goods, or
     services by telephone to a customer or potential customer who initiated the call.
          ``(8) The term `own' with respect to an entity means to have a direct or indirect
     equity interest (or the equivalent thereof) of more than 10 percent of an entity, or the right
     to more than 10 percent of the gross revenues of an entity under a revenue sharing or
     royalty agreement.
          ``(9) The term `separated affiliate' means a corporation under common ownership
     or control with a Bell operating company that does not own or control a Bell operating
     company and is not owned or controlled by a Bell operating company and that engages in
     the provision of electronic publishing which is disseminated by means of such Bell
     operating company's or any of its affiliates' basic telephone service.
          ``(10) The term `Bell operating company' has the meaning provided in section 3,
     except that such term includes any entity or corporation that is owned or controlled by
     such a company (as so defined) but does not include an electronic publishing joint
     venture owned by such an entity or corporation.

``SEC. 275. ALARM MONITORING SERVICES.
     ``(a) Delayed Entry Into Alarm Monitoring.--
          ``(1) Prohibition.--No Bell operating company or affiliate thereof shall engage in
     the provision of alarm monitoring services before the date which is 5 years after the date
     of enactment of the Telecommunications Act of 1996.
          ``(2) Existing activities.--Paragraph (1) does not prohibit or limit the provision,
     directly or through an affiliate, of alarm monitoring services by a Bell operating company
     that was engaged in providing alarm monitoring services as of November 30, 1995,
     directly or through an affiliate. Such Bell operating company or affiliate may not acquire
     any equity interest in, or obtain financial control of, any unaffiliated alarm monitoring
     service entity after November 30, 1995, and until 5 years after the date of enactment of
     the Telecommunications Act of 1996, except that this sentence shall not prohibit an
     exchange of customers for the customers of an unaffiliated alarm monitoring service
     entity.
     ``(b) Nondiscrimination.--An incumbent local exchange carrier (as defined in section
251(h)) engaged in the provision of alarm monitoring services shall--
          ``(1) provide nonaffiliated entities, upon reasonable request, with the network
     services it provides to its own alarm monitoring operations, on nondiscriminatory terms
     and conditions; and
          ``(2) not subsidize its alarm monitoring services either directly or indirectly from
     telephone exchange service operations.
     ``(c) Expedited Consideration of Complaints.--The Commission shall establish
procedures for the receipt and review of complaints concerning violations of subsection (b) or the
regulations thereunder that result in material financial harm to a provider of alarm monitoring
service. Such procedures shall ensure that the Commission will make a final determination with
respect to any such complaint within 120 days after receipt of the complaint. If the complaint
contains an appropriate showing that the alleged violation occurred, as determined by the
Commission in accordance with such regulations, the Commission shall, within 60 days after
receipt of the complaint, order the incumbent local exchange carrier (as defined in section
251(h)) and its affiliates to cease engaging in such violation pending such final determination.
     ``(d) Use of Data.--A local exchange carrier may not record or use in any fashion the
occurrence or contents of calls received by providers of alarm monitoring services for the
purposes of marketing such services on behalf of such local exchange carrier, or any other entity.
Any regulations necessary to enforce this subsection shall be issued initially within 6 months
after the date of enactment of the Telecommunications Act of 1996. 
     ``(e) Definition of Alarm Monitoring service.--The term `alarm monitoring service'
means a service that uses a device located at a residence, place of business, or other fixed
premises--
          ``(1) to receive signals from other devices located at or about such premises
     regarding a possible threat at such premises to life, safety, or property, from burglary,
     fire, vandalism, bodily injury, or other emergency, and
          ``(2) to transmit a signal regarding such threat by means of transmission facilities
     of a local exchange carrier or one of its affiliates to a remote monitoring center to alert a
     person at such center of the need to inform the customer or another person or police, fire,
     rescue, security, or public safety personnel of such threat,
but does not include a service that uses a medical monitoring device attached to an individual for
the automatic surveillance of an ongoing medical condition.

``SEC. 276. PROVISION OF PAYPHONE SERVICE.
     ``(a) Nondiscrimination Safeguards.--After the effective date of the rules prescribed
pursuant to subsection (b), any Bell operating company that provides payphone service--
          ``(1) shall not subsidize its payphone service directly or indirectly from its
     telephone exchange service operations or its exchange access operations; and
          ``(2) shall not prefer or discriminate in favor of its payphone service.
     ``(b) Regulations.--
          ``(1) Contents of regulations.--In order to promote competition among
     payphone service providers and promote the widespread deployment of payphone
     services to the benefit of the general public, within 9 months after the date of enactment
     of the Telecommunications Act of 1996, the Commission shall take all actions necessary
     (including any reconsideration) to prescribe regulations that--
               ``(A) establish a per call compensation plan to ensure that all payphone
          service providers are fairly compensated for each and every completed intrastate
          and interstate call using their payphone, except that emergency calls and
          telecommunications relay service calls for hearing disabled individuals shall not
          be subject to such compensation;
               ``(B) discontinue the intrastate and interstate carrier access charge
          payphone service elements and payments in effect on such date of enactment, and
          all intrastate and interstate payphone subsidies from basic exchange and exchange
          access revenues, in favor of a compensation plan as specified in subparagraph (A);
               ``(C) prescribe a set of nonstructural safeguards for Bell operating
          company payphone service to implement the provisions of paragraphs (1) and (2)
          of subsection (a), which safeguards shall, at a minimum, include the nonstructural
          safeguards equal to those adopted in the Computer Inquiry-III (CC Docket No.
          90	623) proceeding;
               ``(D) provide for Bell operating company payphone service providers to
          have the same right that independent payphone providers have to negotiate with
          the location provider on the location provider's selecting and contracting with,
          and, subject to the terms of any agreement with the location provider, to select and
          contract with, the carriers that carry interLATA calls from their payphones, unless
          the Commission determines in the rulemaking pursuant to this section that it is not
          in the public interest; and
               ``(E) provide for all payphone service providers to have the right to
          negotiate with the location provider on the location provider's selecting and
          contracting with, and, subject to the terms of any agreement with the location
          provider, to select and contract with, the carriers that carry intraLATA calls from
          their payphones.
          ``(2) Public interest telephones.--In the rulemaking conducted pursuant to
     paragraph (1), the Commission shall determine whether public interest payphones, which
     are provided in the interest of public health, safety, and welfare, in locations where there
     would otherwise not be a payphone, should be maintained, and if so, ensure that such
     public interest payphones are supported fairly and equitably.
          ``(3) Existing contracts.--Nothing in this section shall affect any existing
     contracts between location providers and payphone service providers or interLATA or
     intraLATA carriers that are in force and effect as of the date of enactment of the
     Telecommunications Act of 1996.
     ``(c) State Preemption.--To the extent that any State requirements are inconsistent with
the Commission's regulations, the Commission's regulations on such matters shall preempt such
State requirements.
     ``(d) Definition.--As used in this section, the term `payphone service' means the
provision of public or semi-public pay telephones, the provision of inmate telephone service in
correctional institutions, and any ancillary services.''.
     (b) Review of Entry Decisions.--Section 402(b) (47 U.S.C. 402(b)) is amended--
          (1) in paragraph (6), by striking ``(3), and (4)'' and inserting ``(3), (4), and (9)'';
     and
          (2) by adding at the end the following new paragraph:
     ``(9) By any applicant for authority to provide interLATA services under section 271 of
this Act whose application is denied by the Commission.''.

                  TITLE II--BROADCAST SERVICES
                                
SEC. 201. BROADCAST SPECTRUM FLEXIBILITY.
     Title III is amended by inserting after section 335 (47 U.S.C. 335) the following new
section:

``SEC. 336. BROADCAST SPECTRUM FLEXIBILITY.
     ``(a) Commission Action.--If the Commission determines to issue additional licenses for
advanced television services, the Commission--
          ``(1) should limit the initial eligibility for such licenses to persons that, as of the
     date of such issuance, are licensed to operate a television broadcast station or hold a
     permit to construct such a station (or both); and
          ``(2) shall adopt regulations that allow the holders of such licenses to offer such
     ancillary or supplementary services on designated frequencies as may be consistent with
     the public interest, convenience, and necessity.
     ``(b) Contents of Regulations.--In prescribing the regulations required by subsection
(a), the Commission shall--
          ``(1) only permit such licensee or permittee to offer ancillary or supplementary
     services if the use of a designated frequency for such services is consistent with the
     technology or method designated by the Commission for the provision of advanced
     television services;
          ``(2) limit the broadcasting of ancillary or supplementary services on designated
     frequencies so as to avoid derogation of any advanced television services, including high
     definition television broadcasts, that the Commission may require using such frequencies;
          ``(3) apply to any other ancillary or supplementary service such of the
     Commission's regulations as are applicable to the offering of analogous services by any
     other person, except that no ancillary or supplementary service shall have any rights to
     carriage under section 614 or 615 or be deemed a multichannel video programming
     distributor for purposes of section 628;
          ``(4) adopt such technical and other requirements as may be necessary or
     appropriate to assure the quality of the signal used to provide advanced television
     services, and may adopt regulations that stipulate the minimum number of hours per day
     that such signal must be transmitted; and
          ``(5) prescribe such other regulations as may be necessary for the protection of the
     public interest, convenience, and necessity.
     ``(c) Recovery of License.--If the Commission grants a license for advanced television
services to a person that, as of the date of such issuance, is licensed to operate a television
broadcast station or holds a permit to construct such a station (or both), the Commission shall, as
a condition of such license, require that either the additional license or the original license held
by the licensee be surrendered to the Commission for reallocation or reassignment (or both)
pursuant to Commission regulation.
     ``(d) Public Interest Requirement.--Nothing in this section shall be construed as
relieving a television broadcasting station from its obligation to serve the public interest,
convenience, and necessity. In the Commission's review of any application for renewal of a
broadcast license for a television station that provides ancillary or supplementary services, the
television licensee shall establish that all of its program services on the existing or advanced
television spectrum are in the public interest. Any violation of the Commission rules applicable
to ancillary or supplementary services shall reflect upon the licensee's qualifications for renewal
of its license.
     ``(e) Fees.--
          ``(1) Services to which fees apply.--If the regulations prescribed pursuant to
     subsection (a) permit a licensee to offer ancillary or supplementary services on a
     designated frequency--
               ``(A) for which the payment of a subscription fee is required in order to
          receive such services, or
               ``(B) for which the licensee directly or indirectly receives compensation
          from a third party in return for transmitting material furnished by such third party
          (other than commercial advertisements used to support broadcasting for which a
          subscription fee is not required),
     the Commission shall establish a program to assess and collect from the licensee for such
     designated frequency an annual fee or other schedule or method of payment that promotes
     the objectives described in subparagraphs (A) and (B) of paragraph (2).
          ``(2) Collection of fees.--The program required by paragraph (1) shall--
               ``(A) be designed (i) to recover for the public a portion of the value of the
          public spectrum resource made available for such commercial use, and (ii) to
          avoid unjust enrichment through the method employed to permit such uses of that
          resource;
               ``(B) recover for the public an amount that, to the extent feasible, equals
          but does not exceed (over the term of the license) the amount that would have
          been recovered had such services been licensed pursuant to the provisions of
          section 309(j) of this Act and the Commission's regulations thereunder; and
               ``(C) be adjusted by the Commission from time to time in order to
          continue to comply with the requirements of this paragraph.
          ``(3) Treatment of revenues.--
               ``(A) General rule.--Except as provided in subparagraph (B), all
          proceeds obtained pursuant to the regulations required by this subsection shall be
          deposited in the Treasury in accordance with chapter 33 of title 31, United States
          Code.
               ``(B) Retention of revenues.--Notwithstanding subparagraph (A), the
          salaries and expenses account of the Commission shall retain as an offsetting
          collection such sums as may be necessary from such proceeds for the costs of
          developing and implementing the program required by this section and regulating
          and supervising advanced television services. Such offsetting collections shall be
          available for obligation subject to the terms and conditions of the receiving
          appropriations account, and shall be deposited in such accounts on a quarterly
          basis.
          ``(4) Report.--Within 5 years after the date of enactment of the
     Telecommunications Act of 1996, the Commission shall report to the Congress on the
     implementation of the program required by this subsection, and shall annually thereafter
     advise the Congress on the amounts collected pursuant to such program.
     ``(f) Evaluation.--Within 10 years after the date the Commission first issues additional
licenses for advanced television services, the Commission shall conduct an evaluation of the
advanced television services program. Such evaluation shall include--
          ``(1) an assessment of the willingness of consumers to purchase the television
     receivers necessary to receive broadcasts of advanced television services;
          ``(2) an assessment of alternative uses, including public safety use, of the
     frequencies used for such broadcasts; and
          ``(3) the extent to which the Commission has been or will be able to reduce the
     amount of spectrum assigned to licensees.
     ``(g) Definitions.--As used in this section:
          ``(1) Advanced television services.--The term `advanced television services'
     means television services provided using digital or other advanced technology as further
     defined in the opinion, report, and order of the Commission entitled `Advanced
     Television Systems and Their Impact Upon the Existing Television Broadcast Service',
     MM Docket 87	268, adopted September 17, 1992, and successor proceedings.
          ``(2) Designated frequencies.--The term `designated frequency' means each of
     the frequencies designated by the Commission for licenses for advanced television
     services. 
          ``(3) High definition television.--The term `high definition television' refers to
     systems that offer approximately twice the vertical and horizontal resolution of receivers
     generally available on the date of enactment of the Telecommunications Act of 1996, as
     further defined in the proceedings described in paragraph (1) of this subsection.''.

SEC. 202. BROADCAST OWNERSHIP.
     (a) National Radio Station Ownership Rule Changes Required.--The Commission
shall modify section 73.3555 of its regulations (47 C.F.R. 73.3555) by eliminating any
provisions limiting the number of AM or FM broadcast stations which may be owned or
controlled by one entity nationally.
     (b) Local Radio Diversity.--
          (1) Applicable caps.--The Commission shall revise section 73.3555(a) of its
     regulations (47 C.F.R. 73.3555) to provide that--
               (A) in a radio market with 45 or more commercial radio stations, a party
          may own, operate, or control up to 8 commercial radio stations, not more than 5
          of which are in the same service (AM or FM);
               (B) in a radio market with between 30 and 44 (inclusive) commercial radio
          stations, a party may own, operate, or control up to 7 commercial radio stations,
          not more than 4 of which are in the same service (AM or FM);
               (C) in a radio market with between 15 and 29 (inclusive) commercial radio
          stations, a party may own, operate, or control up to 6 commercial radio stations,
          not more than 4 of which are in the same service (AM or FM); and
               (D) in a radio market with 14 or fewer commercial radio stations, a party
          may own, operate, or control up to 5 commercial radio stations, not more than 3
          of which are in the same service (AM or FM), except that a party may not own,
          operate, or control more than 50 percent of the stations in such market.
          (2) Exception.--Notwithstanding any limitation authorized by this subsection, the
     Commission may permit a person or entity to own, operate, or control, or have a
     cognizable interest in, radio broadcast stations if the Commission determines that such
     ownership, operation, control, or interest will result in an increase in the number of radio
     broadcast stations in operation.
     (c) Television Ownership Limitations.--
          (1) National ownership limitations.--The Commission shall modify its rules
     for multiple ownership set forth in section 73.3555 of its regulations (47 C.F.R. 73.3555)--
               (A) by eliminating the restrictions on the number of television stations that
          a person or entity may directly or indirectly own, operate, or control, or have a
          cognizable interest in, nationwide; and
               (B) by increasing the national audience reach limitation for television
          stations to 35 percent.
          (2) Local ownership limitations.--The Commission shall conduct a
     rulemaking proceeding to determine whether to retain, modify, or eliminate its limitations
     on the number of television stations that a person or entity may own, operate, or control,
     or have a cognizable interest in, within the same television market. 
     (d) Relaxation of One-To-A-Market.--With respect to its enforcement of its one-to-a-market ownership rules under section 73.3555 of its regulations, the Commission shall extend its
waiver policy to any of the top 50 markets, consistent with the public interest, convenience, and
necessity.
     (e) Dual Network Changes.--The Commission shall revise section 73.658(g) of its
regulations (47 C.F.R. 658(g)) to permit a television broadcast station to affiliate with a person or
entity that maintains 2 or more networks of television broadcast stations unless such dual or
multiple networks are composed of--
          (1) two or more persons or entities that, on the date of enactment of the
     Telecommunications Act of 1996, are ``networks'' as defined in section 73.3613(a)(1) of
     the Commission's regulations (47 C.F.R. 73.3613(a)(1)); or
          (2) any network described in paragraph (1) and an English-language program
     distribution service that, on such date, provides 4 or more hours of programming per
     week on a national basis pursuant to network affiliation arrangements with local
     television broadcast stations in markets reaching more than 75 percent of television
     homes (as measured by a national ratings service).
     (f) Cable Cross Ownership.--
          (1) Elimination of restrictions.--The Commission shall revise section 76.501
     of its regulations (47 C.F.R. 76.501) to permit a person or entity to own or control a
     network of broadcast stations and a cable system.
          (2) Safeguards against discrimination.--The Commission shall revise such
     regulations if necessary to ensure carriage, channel positioning, and nondiscriminatory
     treatment of nonaffiliated broadcast stations by a cable system described in paragraph (1).
     (g) Local Marketing Agreements.--Nothing in this section shall be construed to
prohibit the origination, continuation, or renewal of any television local marketing agreement
that is in compliance with the regulations of the Commission. 
     (h) Further Commission Review.--The Commission shall review its rules adopted
pursuant to this section and all of its ownership rules biennially as part of its regulatory reform
review under section 11 of the Communications Act of 1934 and shall determine whether any of
such rules are necessary in the public interest as the result of competition. The Commission shall
repeal or modify any regulation it determines to be no longer in the public interest.
     (i) Elimination of Statutory Restriction.--Section 613(a) (47 U.S.C. 533(a)) is
amended--
          (1) by striking paragraph (1);
          (2) by redesignating paragraph (2) as subsection (a);
          (3) by redesignating subparagraphs (A) and (B) as paragraphs (1) and (2),
     respectively;
          (4) by striking ``and'' at the end of paragraph (1) (as so redesignated);
          (5) by striking the period at the end of paragraph (2) (as so redesignated) and
     inserting ``; and''; and
          (6) by adding at the end the following new paragraph:
          ``(3) shall not apply the requirements of this subsection to any cable operator in
     any franchise area in which a cable operator is subject to effective competition as
     determined under section 623(l).''.

SEC. 203. TERM OF LICENSES.
     Section 307(c) (47 U.S.C. 307(c)) is amended to read as follows:
     ``(c) Terms of Licenses.--
          ``(1) Initial and renewal licenses.--Each license granted for the operation of a
     broadcasting station shall be for a term of not to exceed 8 years.  Upon application
     therefor, a renewal of such license may be granted from time to time for a term of not to
     exceed 8 years from the date of expiration of the preceding license, if the Commission
     finds that public interest, convenience, and necessity would be served thereby. 
     Consistent with the foregoing provisions of this subsection, the Commission may by rule
     prescribe the period or periods for which licenses shall be granted and renewed for
     particular classes of stations, but the Commission may not adopt or follow any rule which
     would preclude it, in any case involving a station of a particular class, from granting or
     renewing a license for a shorter period than that prescribed for stations of such class if, in
     its judgment, the public interest, convenience, or necessity would be served by such
     action.
          ``(2) Materials in application.--In order to expedite action on applications for
     renewal of broadcasting station licenses and in order to avoid needless expense to
     applicants for such renewals, the Commission shall not require any such applicant to file
     any information which previously has been furnished to the Commission or which is not
     directly material to the considerations that affect the granting or denial of such
     application, but the Commission may require any new or additional facts it deems
     necessary to make its findings. 
          ``(3) Continuation pending decision.--Pending any hearing and final decision
     on such an application and the disposition of any petition for rehearing pursuant to
     section 405, the Commission shall continue such license in effect.''.

SEC. 204. BROADCAST LICENSE RENEWAL PROCEDURES.
     (a) Renewal Procedures.--
          (1) Amendment.--Section 309 (47 U.S.C. 309) is amended by adding at the end
     thereof the following new subsection:
     ``(k) Broadcast Station Renewal Procedures.--
          ``(1) Standards for renewal.--If the licensee of a broadcast station submits an
     application to the Commission for renewal of such license, the Commission shall grant
     the application if it finds, with respect to that station, during the preceding term of its
     license--
               ``(A) the station has served the public interest, convenience, and necessity;
               ``(B) there have been no serious violations by the licensee of this Act or
          the rules and regulations of the Commission; and
               ``(C) there have been no other violations by the licensee of this Act or the
          rules and regulations of the Commission which, taken together, would constitute a
          pattern of abuse.
          ``(2) Consequence of failure to meet standard.--If any licensee of a
     broadcast station fails to meet the requirements of this subsection, the Commission may
     deny the application for renewal in accordance with paragraph (3), or grant such
     application on terms and conditions as are appropriate, including renewal for a term less
     than the maximum otherwise permitted.
          ``(3) Standards for denial.--If the Commission determines, after notice and
     opportunity for a hearing as provided in subsection (e), that a licensee has failed to meet
     the requirements specified in paragraph (1) and that no mitigating factors justify the
     imposition of lesser sanctions, the Commission shall--
               ``(A) issue an order denying the renewal application filed by such licensee
          under section 308; and
               ``(B) only thereafter accept and consider such applications for a
          construction permit as may be filed under section 308 specifying the channel or
          broadcasting facilities of the former licensee.
          ``(4) Competitor consideration prohibited.--In making the determinations
     specified in paragraph (1) or (2), the Commission shall not consider whether the public
     interest, convenience, and necessity might be served by the grant of a license to a person
     other than the renewal applicant.''.
          (2) Conforming amendment.--Section 309(d) (47 U.S.C. 309(d)) is amended by
     inserting after ``with subsection (a)'' each place it appears the following: ``(or subsection
     (k) in the case of renewal of any broadcast station license)''.
     (b) Summary of Complaints on Violent Programming.--Section 308 (47 U.S.C. 
308) is amended by adding at the end the following new subsection:
     ``(d) Summary of Complaints.--Each applicant for the renewal of a commercial or
noncommercial television license shall attach as an exhibit to the application a summary of
written comments and suggestions received from the public and maintained by the licensee (in
accordance with Commission regulations) that comment on the applicant's programming, if any,
and that are characterized by the commentor as constituting violent programming.''.
     (c) Effective Date.--The amendments made by this section apply to applications filed
after May 1, 1995.

SEC. 205. DIRECT BROADCAST SATELLITE SERVICE.
     (a) DBS Signal Security.--Section 705(e)(4) (47 U.S.C. 605(e)(4)) is amended by
inserting ``or direct-to-home satellite services,'' after ``programming,''.
     (b) FCC Jurisdiction Over Direct-to-Home Satellite Services.--Section 303 (47
U.S.C. 303) is amended by adding at the end thereof the following new subsection:
     ``(v) Have exclusive jurisdiction to regulate the provision of direct-to-home satellite
services. As used in this subsection, the term `direct-to-home satellite services' means the
distribution or broadcasting of programming or services by satellite directly to the subscriber's
premises without the use of ground receiving or distribution equipment, except at the subscriber's
premises or in the uplink process to the satellite.''.

SEC. 206. AUTOMATED SHIP DISTRESS AND SAFETY SYSTEMS.
     Part II of title III is amended by inserting after section 364 (47 U.S.C. 362) the following
new section:

``SEC. 365. AUTOMATED SHIP DISTRESS AND SAFETY SYSTEMS.
     ``Notwithstanding any provision of this Act or any other provision of law or regulation, a
ship documented under the laws of the United States operating in accordance with the Global
Maritime Distress and Safety System provisions of the Safety of Life at Sea Convention shall not
be required to be equipped with a radio telegraphy station operated by one or more radio officers
or operators. This section shall take effect for each vessel upon a determination by the United
States Coast Guard that such vessel has the equipment required to implement the Global
Maritime Distress and Safety System installed and operating in good working condition.''.

SEC. 207. RESTRICTIONS ON OVER-THE-AIR RECEPTION DEVICES.
     Within 180 days after the date of enactment of this Act, the Commission shall, pursuant
to section 303 of the Communications Act of 1934, promulgate regulations to prohibit
restrictions that impair a viewer's ability to receive video programming services through devices
designed for over-the-air reception of television broadcast signals, multichannel multipoint
distribution service, or direct broadcast satellite services.

                   TITLE III--CABLE SERVICES
                                
SEC. 301. CABLE ACT REFORM.
     (a) Definitions.--
          (1) Definition of cable service.--Section 602(6)(B) (47 U.S.C. 522(6)(B)) is
     amended by inserting ``or use'' after ``the selection''.
          (2) Change in definition of cable system.--Section 602(7) (47 U.S.C. 522(7))
     is amended by striking ``(B) a facility that serves only subscribers in 1 or more multiple
     unit dwellings under common ownership, control, or management, unless such facility or
     facilities uses any public right-of-way;'' and inserting ``(B) a facility that serves
     subscribers without using any public right-of-way;''.
     (b) Rate Deregulation.--
          (1) Upper tier regulation.--Section 623(c) (47 U.S.C. 543(c)) is amended--
               (A) in paragraph (1)(B), by striking ``subscriber, franchising authority, or
          other relevant State or local government entity'' and inserting ``franchising
          authority (in accordance with paragraph (3))''; 
               (B) in paragraph (1)(C), by striking ``such complaint'' and inserting ``the
          first complaint filed with the franchising authority under paragraph (3)''; and
               (C) by striking paragraph (3) and inserting the following:
          ``(3) Review of rate changes.--The Commission shall review any complaint
     submitted by a franchising authority after the date of enactment of the
     Telecommunications Act of 1996 concerning an increase in rates for cable programming
     services and issue a final order within 90 days after it receives such a complaint, unless
     the parties agree to extend the period for such review. A franchising authority may not
     file a complaint under this paragraph unless, within 90 days after such increase becomes
     effective it receives subscriber complaints.
          ``(4) Sunset of upper tier rate regulation.--This subsection shall not apply to
     cable programming services provided after March 31, 1999.''.
          (2) Sunset of uniform rate structure in markets with effective
     competition.--Section 623(d) (47 U.S.C. 543(d)) is amended by adding at the end
     thereof the following: ``This subsection does not apply to (1) a cable operator with
     respect to the provision of cable service over its cable system in any geographic area in
     which the video programming services offered by the operator in that area are subject to
     effective competition, or (2) any video programming offered on a per channel or per
     program basis. Bulk discounts to multiple dwelling units shall not be subject to this
     subsection, except that a cable operator of a cable system that is not subject to effective
     competition may not charge predatory prices to a multiple dwelling unit. Upon a prima
     facie showing by a complainant that there are reasonable grounds to believe that the
     discounted price is predatory, the cable system shall have the burden of showing that its
     discounted price is not predatory.''.
          (3) Effective competition.--Section 623(l)(1) (47 U.S.C. 543(l)(1)) is amended-
               (A) by striking ``or'' at the end of subparagraph (B);
               (B) by striking the period at the end of subparagraph (C) and inserting ``;
          or''; and
               (C) by adding at the end the following:
               ``(D) a local exchange carrier or its affiliate (or any multichannel video
          programming distributor using the facilities of such carrier or its affiliate) offers
          video programming services directly to subscribers by any means (other than
          direct-to-home satellite services) in the franchise area of an unaffiliated cable
          operator which is providing cable service in that franchise area, but only if the
          video programming services so offered in that area are comparable to the video
          programming services provided by the unaffiliated cable operator in that area.''
     (c) Greater Deregulation for Smaller Cable Companies.--Section 623 (47 U.S.C
543) is amended by adding at the end thereof the following:
     ``(m) Special Rules for Small Companies.--
          ``(1) In general.--Subsections (a), (b), and (c) do not apply to a small cable
     operator with respect to--
               ``(A) cable programming services, or
               ``(B) a basic service tier that was the only service tier subject to regulation
          as of December 31, 1994,
     in any franchise area in which that operator services 50,000 or fewer subscribers.
          ``(2) Definition of small cable operator.--For purposes of this subsection, the
     term `small cable operator' means a cable operator that, directly or through an affiliate,
     serves in the aggregate fewer than 1 percent of all subscribers in the United States and is
     not affiliated with any entity or entities whose gross annual revenues in the aggregate
     exceed $250,000,000.''.
     (d) Market Determinations.--
          (1) Market determinations; expedited decisionmaking.--Section
     614(h)(1)(C) (47 U.S.C. 534(h)(1)(C)) is amended--
               (A) by striking ``in the manner provided in section 73.3555(d)(3)(i) of title
          47, Code of Federal Regulations, as in effect on May 1, 1991,'' in clause (i) and
          inserting ``by the Commission by regulation or order using, where available,
          commercial publications which delineate television markets based on viewing
          patterns,''; and
               (B) by striking clause (iv) and inserting the following:
                    ``(iv) Within 120 days after the date on which a request is filed
               under this subparagraph (or 120 days after the date of enactment of the
               Telecommunications Act of 1996, if later), the Commission shall grant or
               deny the request.''.
          (2) Application to pending requests.--The amendment made by paragraph (1)
     shall apply to--
               (A) any request pending under section 614(h)(1)(C) of the
          Communications Act of 1934 (47 U.S.C. 534(h)(1)(C)) on the date of enactment
          of this Act; and
               (B) any request filed under that section after that date.
     (e) Technical Standards.--Section 624(e) (47 U.S.C. 544(e)) is amended by striking
the last two sentences and inserting the following: ``No State or franchising authority may
prohibit, condition, or restrict a cable system's use of any type of subscriber equipment or any
transmission technology.''.
     (f) Cable Equipment Compatibility.--Section 624A (47 U.S.C. 544A) is amended--
          (1) in subsection (a) by striking ``and'' at the end of paragraph (2), by striking the
     period at the end of paragraph (3) and inserting ``; and''; and by adding at the end the
     following new paragraph:
          ``(4) compatibility among televisions, video cassette recorders, and cable systems
     can be assured with narrow technical standards that mandate a minimum degree of
     common design and operation, leaving all features, functions, protocols, and other
     product and service options for selection through open competition in the market.'';
          (2) in subsection (c)(1)--
               (A) by redesignating subparagraphs (A) and (B) as subparagraphs (B) and
          (C), respectively; and
               (B) by inserting before such redesignated subparagraph (B) the following
          new subparagraph:
               ``(A) the need to maximize open competition in the market for all features,
          functions, protocols, and other product and service options of converter boxes and
          other cable converters unrelated to the descrambling or decryption of cable
          television signals;''; and
          (3) in subsection (c)(2)--
               (A) by redesignating subparagraphs (D) and (E) as subparagraphs (E) and
          (F), respectively; and
               (B) by inserting after subparagraph (C) the following new subparagraph:
               ``(D) to ensure that any standards or regulations developed under the
          authority of this section to ensure compatibility between televisions, video
          cassette recorders, and cable systems do not affect features, functions, protocols,
          and other product and service options other than those specified in paragraph
          (1)(B), including telecommunications interface equipment, home automation
          communications, and computer network services;''.
     (g) Subscriber Notice.--Section 632 (47 U.S.C. 552) is amended--
          (1) by redesignating subsection (c) as subsection (d); and
          (2) by inserting after subsection (b) the following new subsection:
     ``(c) Subscriber Notice.--A cable operator may provide notice of service and rate
changes to subscribers using any reasonable written means at its sole discretion. Notwithstanding
section 623(b)(6) or any other provision of this Act, a cable operator shall not be required to
provide prior notice of any rate change that is the result of a regulatory fee, franchise fee, or any
other fee, tax, assessment, or charge of any kind imposed by any Federal agency, State, or
franchising authority on the transaction between the operator and the subscriber.''.
     (h) Program Access.--Section 628 (47 U.S.C. 548) is amended by adding at the end the
following:
     ``(j) Common Carriers.--Any provision that applies to a cable operator under this
section shall apply to a common carrier or its affiliate that provides video programming by any
means directly to subscribers.  Any such provision that applies to a satellite cable programming
vendor in which a cable operator has an attributable interest shall apply to any satellite cable
programming vendor in which such common carrier has an attributable interest. For the purposes
of this subsection, two or fewer common officers or directors shall not by itself establish an
attributable interest by a common carrier in a satellite cable programming vendor (or its parent
company).''.
     (i) Antitrafficking.--Section 617 (47 U.S.C. 537) is amended--
          (1) by striking subsections (a) through (d); and
          (2) in subsection (e), by striking ``(e)'' and all that follows through ``a franchising
     authority'' and inserting ``A franchising authority''.
     (j) Aggregation of Equipment Costs.--Section 623(a) (47 U.S.C. 543(a)) is amended
by adding at the end the following new paragraph:
          ``(7) Aggregation of equipment costs.--
               ``(A) In general.--The Commission shall allow cable operators, pursuant
          to any rules promulgated under subsection (b)(3), to aggregate, on a franchise,
          system, regional, or company level, their equipment costs into broad categories,
          such as converter boxes, regardless of the varying levels of functionality of the
          equipment within each such broad category. Such aggregation shall not be
          permitted with respect to equipment used by subscribers who receive only a rate
          regulated basic service tier.
               ``(B) Revision to commission rules; forms.--Within 120 days of the
          date of enactment of the Telecommunications Act of 1996, the Commission shall
          issue revisions to the appropriate rules and forms necessary to implement
          subparagraph (A).''.
     (k) Treatment of Prior Year Losses.--
          (1) Amendment.--Section 623 (48 U.S.C. 543) is amended by adding at the end
     thereof the following:
     ``(n) Treatment of Prior Year Losses.--Notwithstanding any other provision of this
section or of section 612, losses associated with a cable system (including losses associated with
the grant or award of a franchise) that were incurred prior to September 4, 1992, with respect to a
cable system that is owned and operated by the original franchisee of such system shall not be
disallowed, in whole or in part, in the determination of whether the rates for any tier of service or
any type of equipment that is subject to regulation under this section are lawful.''.
          (2) Effective date.--The amendment made by paragraph (1) shall take effect on
     the date of enactment of this Act and shall be applicable to any rate proposal filed on or
     after September 4, 1993, upon which no final action has been taken by December 1,
     1995.

SEC. 302. CABLE SERVICE PROVIDED BY TELEPHONE COMPANIES.
     (a) Provisions for Regulation of Cable Service Provided by Telephone
Companies.--Title VI (47 U.S.C. 521 et seq.) is amended by adding at the end the following new
part:
              ``PART V--VIDEO PROGRAMMING SERVICES
                PROVIDED BY TELEPHONE COMPANIES
                                
``SEC. 651. REGULATORY TREATMENT OF VIDEO PROGRAMMING SERVICES.
     ``(a) Limitations on Cable Regulation.--
          ``(1) Radio-based systems.--To the extent that a common carrier (or any other
     person) is providing video programming to subscribers using radio communication, such
     carrier (or other person) shall be subject to the requirements of title III and section 652,
     but shall not otherwise be subject to the requirements of this title. 
          ``(2) Common carriage of video traffic.--To the extent that a common carrier
     is providing transmission of video programming on a common carrier basis, such carrier
     shall be subject to the requirements of title II and section 652, but shall not otherwise be
     subject to the requirements of this title. This paragraph shall not affect the treatment
     under section 602(7)(C) of a facility of a common carrier as a cable system.
          ``(3) Cable systems and open video systems.--To the extent that a common
     carrier is providing video programming to its subscribers in any manner other than that
     described in paragraphs (1) and (2)--
               ``(A) such carrier shall be subject to the requirements of this title, unless
          such programming is provided by means of an open video system for which the
          Commission has approved a certification under section 653; or
               ``(B) if such programming is provided by means of an open video system
          for which the Commission has approved a certification under section 653, such
          carrier shall be subject to the requirements of this part, but shall be subject to parts
          I through IV of this title only as provided in 653(c).
          ``(4) Election to operate as open video system.--A common carrier that is
     providing video programming in a manner described in paragraph (1) or (2), or a
     combination thereof, may elect to provide such programming by means of an open video
     system that complies with section 653. If the Commission approves such carrier's
     certification under section 653, such carrier shall be subject to the requirements of this
     part, but shall be subject to parts I through IV of this title only as provided in 653(c).
     ``(b) Limitations on Interconnection Obligations.--A local exchange carrier that
provides cable service through an open video system or a cable system shall not be required,
pursuant to title II of this Act, to make capacity available on a nondiscriminatory basis to any
other person for the provision of cable service directly to subscribers.
     ``(c) Additional Regulatory Relief.--A common carrier shall not be required to
obtain a certificate under section 214 with respect to the establishment or operation of a system
for the delivery of video programming.

``SEC. 652. PROHIBITION ON BUY OUTS.
     ``(a) Acquisitions by Carriers.--No local exchange carrier or any affiliate of such
carrier owned by, operated by, controlled by, or under common control with such carrier may
purchase or otherwise acquire directly or indirectly more than a 10 percent financial interest, or
any management interest, in any cable operator providing cable service within the local exchange
carrier's telephone service area.
     ``(b) Acquisitions by Cable Operators.--No cable operator or affiliate of a cable
operator that is owned by, operated by, controlled by, or under common ownership with such
cable operator may purchase or otherwise acquire, directly or indirectly, more than a 10 percent
financial interest, or any management interest, in any local exchange carrier providing telephone
exchange service within such cable operator's franchise area.
     ``(c) Joint Ventures.--A local exchange carrier and a cable operator whose telephone
service area and cable franchise area, respectively, are in the same market may not enter into any
joint venture or partnership to provide video programming directly to subscribers or to provide
telecommunications services within such market.
     ``(d) Exceptions.--
          ``(1) Rural systems.--Notwithstanding subsections (a), (b), and (c) of this
     section, a local exchange carrier (with respect to a cable system located in its telephone
     service area) and a cable operator (with respect to the facilities of a local exchange carrier
     used to provide telephone exchange service in its cable franchise area) may obtain a
     controlling interest in, management interest in, or enter into a joint venture or partnership
     with the operator of such system or facilities for the use of such system or facilities to the
     extent that--
               ``(A) such system or facilities only serve incorporated or unincorporated--
                    ``(i) places or territories that have fewer than 35,000 inhabitants;
               and
                    ``(ii) are outside an urbanized area, as defined by the Bureau of the
               Census; and
               ``(B) in the case of a local exchange carrier, such system, in the aggregate
          with any other system in which such carrier has an interest, serves less than 10
          percent of the households in the telephone service area of such carrier.
          ``(2) Joint use.--Notwithstanding subsection (c), a local exchange carrier may
     obtain, with the concurrence of the cable operator on the rates, terms, and conditions, the
     use of that part of the transmission facilities of a cable system extending from the last
     multi-user terminal to the premises of the end user, if such use is reasonably limited in
     scope and duration, as determined by the Commission.
          ``(3) Acquisitions in competitive markets.--Notwithstanding subsections (a)
     and (c), a local exchange carrier may obtain a controlling interest in, or form a joint
     venture or other partnership with, or provide financing to, a cable system (hereinafter in
     this paragraph referred to as `the subject cable system'), if--
               ``(A) the subject cable system operates in a television market that is not in
          the top 25 markets, and such market has more than 1 cable system operator, and
          the subject cable system is not the cable system with the most subscribers in such
          television market;
               ``(B) the subject cable system and the cable system with the most
          subscribers in such television market held on May 1, 1995, cable television
          franchises from the largest municipality in the television market and the
          boundaries of such franchises were identical on such date;
               ``(C) the subject cable system is not owned by or under common
          ownership or control of any one of the 50 cable system operators with the most
          subscribers as such operators existed on May 1, 1995; and
               ``(D) the system with the most subscribers in the television market is
          owned by or under common ownership or control of any one of the 10 largest
          cable system operators as such operators existed on May 1, 1995.
          ``(4) Exempt cable systems.--Subsection (a) does not apply to any cable system
     if--
               ``(A) the cable system serves no more than 17,000 cable subscribers, of
          which no less than 8,000 live within an urban area, and no less than 6,000 live
          within a nonurbanized area as of June 1, 1995;
               ``(B) the cable system is not owned by, or under common ownership or
          control with, any of the 50 largest cable system operators in existence on June 1,
          1995; and
               ``(C) the cable system operates in a television market that was not in the
          top 100 television markets as of June 1, 1995.
          ``(5) Small cable systems in nonurban areas.--Notwithstanding subsections
     (a) and (c), a local exchange carrier with less than $100,000,000 in annual operating
     revenues (or any affiliate of such carrier owned by, operated by, controlled by, or under
     common control with such carrier) may purchase or otherwise acquire more than a 10
     percent financial interest in, or any management interest in, or enter into a joint venture or
     partnership with, any cable system within the local exchange carrier's telephone service
     area that serves no more than 20,000 cable subscribers, if no more than 12,000 of those
     subscribers live within an urbanized area, as defined by the Bureau of the Census.
          ``(6) Waivers.--The Commission may waive the restrictions of subsections (a),
     (b), or (c) only if--
               ``(A) the Commission determines that, because of the nature of the market
          served by the affected cable system or facilities used to provide telephone
          exchange service--
                    ``(i) the affected cable operator or local exchange carrier would be
               subjected to undue economic distress by the enforcement of such
               provisions;
                    ``(ii) the system or facilities would not be economically viable if
               such provisions were enforced; or
                    ``(iii) the anticompetitive effects of the proposed transaction are
               clearly outweighed in the public interest by the probable effect of the
               transaction in meeting the convenience and needs of the community to be
               served; and
               ``(B) the local franchising authority approves of such waiver.
     ``(e) Definition of Telephone Service Area.--For purposes of this section, the term
`telephone service area' when used in connection with a common carrier subject in whole or in
part to title II of this Act means the area within which such carrier provided telephone exchange
service as of January 1, 1993, but if any common carrier after such date transfers its telephone
exchange service facilities to another common carrier, the area to which such facilities provide
telephone exchange service shall be treated as part of the telephone service area of the acquiring
common carrier and not of the selling common carrier.

``SEC. 653. ESTABLISHMENT OF OPEN VIDEO SYSTEMS.
     ``(a) Open Video Systems.--
          ``(1) Certificates of compliance.--A local exchange carrier may provide cable
     service to its cable service subscribers in its telephone service area through an open video
     system that complies with this section. To the extent permitted by such regulations as the
     Commission may prescribe consistent with the public interest, convenience, and
     necessity, an operator of a cable system or any other person may provide video
     programming through an open video system that complies with this section. An operator
     of an open video system shall qualify for reduced regulatory burdens under subsection (c)
     of this section if the operator of such system certifies to the Commission that such carrier
     complies with the Commission's regulations under subsection (b) and the Commission
     approves such certification. The Commission shall publish notice of the receipt of any
     such certification and shall act to approve or disapprove any such certification within 10
     days after receipt of such certification.
          ``(2) Dispute resolution.--The Commission shall have the authority to resolve
     disputes under this section and the regulations prescribed thereunder. Any such dispute
     shall be resolved within 180 days after notice of such dispute is submitted to the
     Commission. At that time or subsequently in a separate damages proceeding, the
     Commission may, in the case of any violation of this section, require carriage, award
     damages to any person denied carriage, or any combination of such sanctions.  Any
     aggrieved party may seek any other remedy available under this Act.
     ``(b) Commission Actions.--
          ``(1) Regulations required.--Within 6 months after the date of enactment of the
     Telecommunications Act of 1996, the Commission shall complete all actions necessary
     (including any reconsideration) to prescribe regulations that--
               ``(A) except as required pursuant to section 611, 614, or 615, prohibit an
          operator of an open video system from discriminating among video programming
          providers with regard to carriage on its open video system, and ensure that the
          rates, terms, and conditions for such carriage are just and reasonable, and are not
          unjustly or unreasonably discriminatory;
               ``(B) if demand exceeds the channel capacity of the open video system,
          prohibit an operator of an open video system and its affiliates from selecting the
          video programming services for carriage on more than one-third of the activated
          channel capacity on such system, but nothing in this subparagraph shall be
          construed to limit the number of channels that the carrier and its affiliates may
          offer to provide directly to subscribers;
               ``(C) permit an operator of an open video system to carry on only one
          channel any video programming service that is offered by more than one video
          programming provider (including the local exchange carrier's video programming
          affiliate), provided that subscribers have ready and immediate access to any such
          video programming service;
               ``(D) extend to the distribution of video programming over open video
          systems the Commission's regulations concerning sports exclusivity (47 C.F.R.
          76.67), network nonduplication (47 C.F.R. 76.92 et seq.), and syndicated
          exclusivity (47 C.F.R. 76.151 et seq.); and
               ``(E)(i) prohibit an operator of an open video system from unreasonably
          discriminating in favor of the operator or its affiliates with regard to material or
          information (including advertising) provided by the operator to subscribers for the
          purposes of selecting programming on the open video system, or in the way such
          material or information is presented to subscribers;
               ``(ii) require an operator of an open video system to ensure that video
          programming providers or copyright holders (or both) are able suitably and
          uniquely to identify their programming services to subscribers; 
               ``(iii) if such identification is transmitted as part of the programming
          signal, require the carrier to transmit such identification without change or
          alteration; and
               ``(iv) prohibit an operator of an open video system from omitting
          television broadcast stations or other unaffiliated video programming services
          carried on such system from any navigational device, guide, or menu.
          ``(2) Consumer access.--Subject to the requirements of paragraph (1) and the
     regulations thereunder, nothing in this section prohibits a common carrier or its affiliate
     from negotiating mutually agreeable terms and conditions with over-the-air broadcast
     stations and other unaffiliated video programming providers to allow consumer access to
     their signals on any level or screen of any gateway, menu, or other program guide,
     whether provided by the carrier or its affiliate.
     ``(c) Reduced Regulatory Burdens for Open Video Systems.--
          ``(1) In general.--Any provision that applies to a cable operator under--
               ``(A) sections 613 (other than subsection (a) thereof), 616, 623(f), 628,
          631, and 634 of this title, shall apply, 
               ``(B) sections 611, 614, and 615 of this title, and section 325 of title III,
          shall apply in accordance with the regulations prescribed under paragraph (2), and
               ``(C) sections 612 and 617, and parts III and IV (other than sections
          623(f), 628, 631, and 634), of this title shall not apply, 
     to any operator of an open video system for which the Commission has approved a
     certification under this section.
          ``(2) Implementation.--
               ``(A) Commission action.--In the rulemaking proceeding to prescribe the
          regulations required by subsection (b)(1), the Commission shall, to the extent
          possible, impose obligations that are no greater or lesser than the obligations
          contained in the provisions described in paragraph (1)(B) of this subsection. The
          Commission shall complete all action (including any reconsideration) to prescribe
          such regulations no later than 6 months after the date of enactment of the
          Telecommunications Act of 1996.
               ``(B) Fees.--An operator of an open video system under this part may be
          subject to the payment of fees on the gross revenues of the operator for the
          provision of cable service imposed by a local franchising authority or other
          governmental entity, in lieu of the franchise fees permitted under section 622. The
          rate at which such fees are imposed shall not exceed the rate at which franchise
          fees are imposed on any cable operator transmitting video programming in the
          franchise area, as determined in accordance with regulations prescribed by the
          Commission. An operator of an open video system may designate that portion of a
          subscriber's bill attributable to the fee under this subparagraph as a separate item
          on the bill.
          ``(3) Regulatory streamlining.--With respect to the establishment and
     operation of an open video system, the requirements of this section shall apply in lieu of,
     and not in addition to, the requirements of title II.
          ``(4) Treatment as cable operator.--Nothing in this Act precludes a video
     programming provider making use of a open video system from being treated as an
     operator of a cable system for purposes of section 111 of title 17, United States Code.
     ``(d) Definition of Telephone Service Area.--For purposes of this section, the term
`telephone service area' when used in connection with a common carrier subject in whole or in
part to title II of this Act means the area within which such carrier is offering telephone exchange
service.''.
     (b) Conforming and Technical Amendments.--
          (1) Repeal.--Subsection (b) of section 613 (47 U.S.C. 533(b)) is repealed.
          (2) Definitions.--Section 602 (47 U.S.C. 531) is amended--
               (A) in paragraph (7), by striking ``, or (D)'' and inserting the following: ``,
          unless the extent of such use is solely to provide interactive on-demand services;
          (D) an open video system that complies with section 653 of this title; or (E)'';
               (B) by redesignating paragraphs (12) through (19) as paragraphs (13)
          through (20), respectively; and
               (C) by inserting after paragraph (11) the following new paragraph:
          ``(12) the term `interactive on-demand services' means a service providing video
     programming to subscribers over switched networks on an on-demand, point-to-point
     basis, but does not include services providing video programming prescheduled by the
     programming provider;''.
          (3) Termination of video-dialtone regulations.--The Commission's
     regulations and policies with respect to video dialtone requirements issued in CC Docket
     No. 87	266 shall cease to be effective on the date of enactment of this Act. This
     paragraph shall not be construed to require the termination of any video-dialtone system
     that the Commission has approved before the date of enactment of this Act.

SEC. 303. PREEMPTION OF FRANCHISING AUTHORITY REGULATION OF
TELECOMMUNICATIONS SERVICES.
     (a) Provision of Telecommunications Services by a Cable Operator.--Section
621(b) (47 U.S.C. 541(b)) is amended by adding at the end thereof the following new paragraph:
     ``(3)(A) If a cable operator or affiliate thereof is engaged in the provision of
telecommunications services--
          ``(i) such cable operator or affiliate shall not be required to obtain a franchise
     under this title for the provision of telecommunications services; and 
          ``(ii) the provisions of this title shall not apply to such cable operator or affiliate
     for the provision of telecommunications services.
     ``(B) A franchising authority may not impose any requirement under this title that has the
purpose or effect of prohibiting, limiting, restricting, or conditioning the provision of a
telecommunications service by a cable operator or an affiliate thereof.
     ``(C) A franchising authority may not order a cable operator or affiliate thereof--
          ``(i) to discontinue the provision of a telecommunications service, or
          ``(ii) to discontinue the operation of a cable system, to the extent such cable
     system is used for the provision of a telecommunications service, by reason of the failure
     of such cable operator or affiliate thereof to obtain a franchise or franchise renewal under
     this title with respect to the provision of such telecommunications service.
     ``(D) Except as otherwise permitted by sections 611 and 612, a franchising authority may
not require a cable operator to provide any telecommunications service or facilities, other than
institutional networks, as a condition of the initial grant of a franchise, a franchise renewal, or a
transfer of a franchise.''.
     (b) Franchise Fees.--Section 622(b) (47 U.S.C. 542(b)) is amended by inserting ``to
provide cable services'' immediately before the period at the end of the first sentence thereof.

SEC. 304. COMPETITIVE AVAILABILITY OF NAVIGATION DEVICES.
     Part III of title VI is amended by inserting after section 628 (47 U.S.C. 548) the following
new section:

``SEC. 629. COMPETITIVE AVAILABILITY OF NAVIGATION DEVICES.
     ``(a) Commercial Consumer Availability of Equipment Used To Access Services
Provided by Multichannel Video Programming Distributors.--The Commission shall, in
consultation with appropriate industry standard-setting organizations, adopt regulations to assure
the commercial availability, to consumers of multichannel video programming and other services
offered over multichannel video programming systems, of converter boxes, interactive
communications equipment, and other equipment used by consumers to access multichannel
video programming and other services offered over multichannel video programming systems,
from manufacturers, retailers, and other vendors not affiliated with any multichannel video
programming distributor. Such regulations shall not prohibit any multichannel video
programming distributor from also offering converter boxes, interactive communications
equipment, and other equipment used by consumers to access multichannel video programming
and other services offered over multichannel video programming systems, to consumers, if the
system operator's charges to consumers for such devices and equipment are separately stated and
not subsidized by charges for any such service.
     ``(b) Protection of System Security.--The Commission shall not prescribe regulations
under subsection (a) which would jeopardize security of multichannel video programming and
other services offered over multichannel video programming systems, or impede the legal rights
of a provider of such services to prevent theft of service.
     ``(c) Waiver.--The Commission shall waive a regulation adopted under subsection (a)
for a limited time upon an appropriate showing by a provider of multichannel video
programming and other services offered over multichannel video programming systems, or an
equipment provider, that such waiver is necessary to assist the development or introduction of a
new or improved multichannel video programming or other service offered over multichannel
video programming systems, technology, or products. Upon an appropriate showing, the
Commission shall grant any such waiver request within 90 days of any application filed under
this subsection, and such waiver shall be effective for all service providers and products in that
category and for all providers of services and products.
     ``(d) Avoidance of Redundant Regulations.--
          ``(1) Commercial availability determinations.--Determinations made or
     regulations prescribed by the Commission with respect to commercial availability to
     consumers of converter boxes, interactive communications equipment, and other
     equipment used by consumers to access multichannel video programming and other
     services offered over multichannel video programming systems, before the date of
     enactment of the Telecommunications Act of 1996 shall fulfill the requirements of this
     section.
          ``(2) Regulations.--Nothing in this section affects section 64.702(e) of the
     Commission's regulations (47 C.F.R. 64.702(e)) or other Commission regulations
     governing interconnection and competitive provision of customer premises equipment
     used in connection with basic common carrier communications services.
     ``(e) Sunset.--The regulations adopted under this section shall cease to apply when the
Commission determines that--
          ``(1) the market for the multichannel video programming distributors is fully
     competitive;
          ``(2) the market for converter boxes, and interactive communications equipment,
     used in conjunction with that service is fully competitive; and
          ``(3) elimination of the regulations would promote competition and the public
     interest.
     ``(f) Commission's Authority.--Nothing in this section shall be construed as expanding
or limiting any authority that the Commission may have under law in effect before the date of
enactment of the Telecommunications Act of 1996.''.

SEC. 305. VIDEO PROGRAMMING ACCESSIBILITY.
     Title VII is amended by inserting after section 712 (47 U.S.C. 612) the following new
section:

``SEC. 713. VIDEO PROGRAMMING ACCESSIBILITY.
     ``(a) Commission Inquiry.--Within 180 days after the date of enactment of the
Telecommunications Act of 1996, the Federal Communications Commission shall complete an
inquiry to ascertain the level at which video programming is closed captioned. Such inquiry shall
examine the extent to which existing or previously published programming is closed captioned,
the size of the video programming provider or programming owner providing closed captioning,
the size of the market served, the relative audience shares achieved, or any other related factors.
The Commission shall submit to the Congress a report on the results of such inquiry.
     ``(b) Accountability Criteria.--Within 18 months after such date of enactment, the
Commission shall prescribe such regulations as are necessary to implement this section. Such
regulations shall ensure that--
          ``(1) video programming first published or exhibited after the effective date of
     such regulations is fully accessible through the provision of closed captions, except as
     provided in subsection (d); and
          ``(2) video programming providers or owners maximize the accessibility of video
     programming first published or exhibited prior to the effective date of such regulations
     through the provision of closed captions, except as provided in subsection (d).
     ``(c) Deadlines for Captioning.--Such regulations shall include an appropriate
schedule of deadlines for the provision of closed captioning of video programming.
     ``(d) Exemptions.--Notwithstanding subsection (b)--
          ``(1) the Commission may exempt by regulation programs, classes of programs,
     or services for which the Commission has determined that the provision of closed
     captioning would be economically burdensome to the provider or owner of such
     programming;
          ``(2) a provider of video programming or the owner of any program carried by the
     provider shall not be obligated to supply closed captions if such action would be
     inconsistent with contracts in effect on the date of enactment of the Telecommunications
     Act of 1996, except that nothing in this section shall be construed to relieve a video
     programming provider of its obligations to provide services required by Federal law; and
          ``(3) a provider of video programming or program owner may petition the
     Commission for an exemption from the requirements of this section, and the Commission
     may grant such petition upon a showing that the requirements contained in this section
     would result in an undue burden.
     ``(e) Undue Burden.--The term `undue burden' means significant difficulty or expense.
In determining whether the closed captions necessary to comply with the requirements of this
paragraph would result in an undue economic burden, the factors to be considered include--
          ``(1) the nature and cost of the closed captions for the programming;
          ``(2) the impact on the operation of the provider or program owner;
          ``(3) the financial resources of the provider or program owner; and
          ``(4) the type of operations of the provider or program owner.
     ``(f) Video Descriptions Inquiry.--Within 6 months after the date of enactment of the
Telecommunications Act of 1996, the Commission shall commence an inquiry to examine the
use of video descriptions on video programming in order to ensure the accessibility of video
programming to persons with visual impairments, and report to Congress on its findings.  The
Commission's report shall assess appropriate methods and schedules for phasing video
descriptions into the marketplace, technical and quality standards for video descriptions, a
definition of programming for which video descriptions would apply, and other technical and
legal issues that the Commission deems appropriate.
     ``(g) Video Description.--For purposes of this section, `video description' means the
insertion of audio narrated descriptions of a television program's key visual elements into natural
pauses between the program's dialogue. 
     ``(h) Private Rights of Actions Prohibited.--Nothing in this section shall be
construed to authorize any private right of action to enforce any requirement of this section or
any regulation thereunder. The Commission shall have exclusive jurisdiction with respect to any
complaint under this section.''.

                  TITLE IV--REGULATORY REFORM
                                
SEC. 401. REGULATORY FORBEARANCE.
     Title I is amended by inserting after section 9 (47 U.S.C. 159) the following new section:

``SEC. 10. COMPETITION IN PROVISION OF TELECOMMUNICATIONS SERVICE.
     ``(a) Regulatory flexibility.--Notwithstanding section 332(c)(1)(A) of this Act, the
Commission shall forbear from applying any regulation or any provision of this Act to a
telecommunications carrier or telecommunications service, or class of telecommunications
carriers or telecommunications services, in any or some of its or their geographic markets, if the
Commission determines that-- 
          ``(1) enforcement of such regulation or provision is not necessary to ensure that
     the charges, practices, classifications, or regulations by, for, or in connection with that
     telecommunications carrier or telecommunications service are just and reasonable and are
     not unjustly or unreasonably discriminatory; 
          ``(2) enforcement of such regulation or provision is not necessary for the
     protection of consumers; and
          ``(3) forbearance from applying such provision or regulation is consistent with the
     public interest. 
     ``(b) Competitive Effect To Be Weighed.--In making the determination under
subsection (a)(3), the Commission shall consider whether forbearance from enforcing the
provision or regulation will promote competitive market conditions, including the extent to
which such forbearance will enhance competition among providers of telecommunications
services. If the Commission determines that such forbearance will promote competition among
providers of telecommunications services, that determination may be the basis for a Commission
finding that forbearance is in the public interest.
     ``(c) Petition for Forbearance.--Any telecommunications carrier, or class of
telecommunications carriers, may submit a petition to the Commission requesting that the
Commission exercise the authority granted under this section with respect to that carrier or those
carriers, or any service offered by that carrier or carriers. Any such petition shall be deemed
granted if the Commission does not deny the petition for failure to meet the requirements for
forbearance under subsection (a) within one year after the Commission receives it, unless the
one-year period is extended by the Commission. The Commission may extend the initial one-year period by an additional 90 days if the Commission finds that an extension is necessary to
meet the requirements of subsection (a). The Commission may grant or deny a petition in whole
or in part and shall explain its decision in writing.
     ``(d) Limitation.--Except as provided in section 251(f), the Commission may not forbear
from applying the requirements of section 251(c) or 271 under subsection (a) of this section until
it determines that those requirements have been fully implemented.
     ``(e) State Enforcement After Commission Forbearance.--A State commission
may not continue to apply or enforce any provision of this Act that the Commission has
determined to forbear from applying under subsection (a).''.

SEC. 402. BIENNIAL REVIEW OF REGULATIONS; REGULATORY RELIEF.
     (a) Biennial Review.--Title I is amended by inserting after section 10 (as added by
section 401) the following new section:

``SEC. 11.  REGULATORY REFORM.
     ``(a) Biennial Review of Regulations.--In every even-numbered year (beginning with
1998), the Commission--
          ``(1) shall review all regulations issued under this Act in effect at the time of the
     review that apply to the operations or activities of any provider of telecommunications
     service; and
          ``(2) shall determine whether any such regulation is no longer necessary in the
     public interest as the result of meaningful economic competition between providers of
     such service.
     ``(b) Effect of Determination.--The Commission shall repeal or modify any regulation
it determines to be no longer necessary in the public interest.''.
     (b) Regulatory Relief.--
          (1) Streamlined procedures for changes in charges, classifications,
     regulations, or practices.--
               (A) Section 204(a) (47 U.S.C. 204(a)) is amended--
                    (i) by striking ``12 months'' the first place it appears in paragraph
               (2)(A) and inserting ``5 months'';
                    (ii) by striking ``effective,'' and all that follows in paragraph (2)(A)
               and inserting ``effective.''; and
                    (iii) by adding at the end thereof the following:
          ``(3) A local exchange carrier may file with the Commission a new or revised
     charge, classification, regulation, or practice on a streamlined basis. Any such charge,
     classification, regulation, or practice shall be deemed lawful and shall be effective 7 days
     (in the case of a reduction in rates) or 15 days (in the case of an increase in rates) after the
     date on 
which it is filed with the Commission unless the Commission takes action under paragraph (1)
before the end of that 7-day or 15-day period, as is appropriate.''.
               (B) Section 208(b) (47 U.S.C. 208(b)) is amended--
                    (i) by striking ``12 months'' the first place it appears in paragraph
               (1) and inserting ``5 months''; and
                    (ii) by striking ``filed,'' and all that follows in paragraph (1) and
               inserting ``filed.''.
          (2) Extensions of lines under section 214; armis reports.--The Commission
     shall permit any common carrier--
               (A) to be exempt from the requirements of section 214 of the
          Communications Act of 1934 for the extension of any line; and
               (B) to file cost allocation manuals and ARMIS reports annually, to the
          extent such carrier is required to file such manuals or reports.
          (3) Forbearance authority not limited.--Nothing in this subsection shall be
     construed to limit the authority of the Commission to waive, modify, or forbear from
     applying any of the requirements to which reference is made in paragraph (1) under any
     other provision of this Act or other law.
          (4) Effective date of amendments.--The amendments made by paragraph (1)
     of this subsection shall apply with respect to any charge, classification, regulation, or
     practice filed on or after one year after the date of enactment of this Act.
     (c) Classification of Carriers.--In classifying carriers according to section 32.11 of its
regulations (47 C.F.R. 32.11) and in establishing reporting requirements pursuant to part 43 of its
regulations (47 C.F.R. part 43) and section 64.903 of its regulations (47 C.F.R. 64.903), the
Commission shall adjust the revenue requirements to account for inflation as of the release date
of the Commission's Report and Order in CC Docket No. 91	141, and annually thereafter. This
subsection shall take effect on the date of enactment of this Act.

SEC. 403. ELIMINATION OF UNNECESSARY COMMISSION REGULATIONS AND
FUNCTIONS.
     (a) Modification of Amateur Radio Examination Procedures.--Section 4(f)(4) (47
U.S.C. 154(f)(4)) is amended--
          (1) in subparagraph (A)--
               (A) by inserting ``or administering'' after ``for purposes of preparing'';
               (B) by inserting ``of'' after ``than the class''; and
               (C) by inserting ``or administered'' after ``for which the examination is
          being prepared'';
          (2) by striking subparagraph (B);
          (3) in subparagraph (H), by striking ``(A), (B), and (C)'' and inserting ``(A) and
     (B)'';
          (4) in subparagraph (J)--
               (A) by striking ``or (B)''; and
               (B) by striking the last sentence; and
          (5) by redesignating subparagraphs (C) through (J) as subparagraphs (B) through
     (I), respectively.
     (b) Authority To Designate Entities To Inspect.--Section 4(f)(3) (47 U.S.C.
154(f)(3)) is amended by inserting before the period at the end the following: ``: And provided
further, That, in the alternative, an entity designated by the Commission may make the
inspections referred to in this paragraph''.
     (c) Expediting Instructional Television Fixed Service Processing.--Section 5(c)(1)
(47 U.S.C. 155(c)(1)) is amended by striking the last sentence and inserting the following:
``Except for cases involving the authorization of service in the instructional television fixed
service, or as otherwise provided in this Act, nothing in this paragraph shall authorize the
Commission to provide for the conduct, by any person or persons other than persons referred to
in paragraph (2) or (3) of section 556(b) of title 5, United States Code, of any hearing to which
such section applies.''.
     (d) Repeal Setting of Depreciation Rates.--The first sentence of section 220(b) (47
U.S.C. 220(b)) is amended by striking ``shall prescribe for such carriers'' and inserting ``may
prescribe, for such carriers as it determines to be appropriate,''.
     (e) Use of Independent Auditors.--Section 220(c) (47 U.S.C. 220(c)) is amended by
adding at the end thereof the following: ``The Commission may obtain the services of any person
licensed to provide public accounting services under the law of any State to assist with, or
conduct, audits under this section. While so employed or engaged in conducting an audit for the
Commission under this section, any such person shall have the powers granted the Commission
under this subsection and shall be subject to subsection (f) in the same manner as if that person
were an employee of the Commission.''.
     (f) Delegation of Equipment Testing and Certification to Private
Laboratories.--Section 302 (47 U.S.C. 302) is amended by adding at the end the following:
     ``(e) The Commission may--
          ``(1) authorize the use of private organizations for testing and certifying the
     compliance of devices or home electronic equipment and systems with regulations
     promulgated under this section;
          ``(2) accept as prima facie evidence of such compliance the certification by any
     such organization; and
          ``(3) establish such qualifications and standards as it deems appropriate for such
     private organizations, testing, and certification.''.
     (g) Making License Modification Uniform.--Section 303(f) (47 U.S.C. 303(f)) is
amended by striking ``unless, after a public hearing,'' and inserting ``unless''.
     (h) Eliminate FCC Jurisdiction Over Government-Owned Ship Radio Stations.-- 
          (1) Section 305 (47 U.S.C. 305) is amended by striking subsection (b) and
     redesignating subsections (c) and (d) as (b) and (c), respectively.
          (2) Section 382(2) (47 U.S.C. 382(2)) is amended by striking ``except a vessel of
     the United States Maritime Administration, the Inland and Coastwise Waterways Service,
     or the Panama Canal Company,''.
     (i) Permit Operation of Domestic Ship and Aircraft Radios Without License.--Section 307(e) (47 U.S.C.  307(e)) is amended to read as follows:
     ``(e)(1) Notwithstanding any license requirement established in this Act, if the
Commission determines that such authorization serves the public interest, convenience, and
necessity, the Commission may by rule authorize the operation of radio stations without
individual licenses in the following radio services: (A) the citizens band radio service; (B) the
radio control service; (C) the aviation radio service for aircraft stations operated on domestic
flights when such aircraft are not otherwise required to carry a radio station; and (D) the
maritime radio service for ship stations navigated on domestic voyages when such ships are not
otherwise required to carry a radio station.
     ``(2) Any radio station operator who is authorized by the Commission to operate without
an individual license shall comply with all other provisions of this Act and with rules prescribed
by the Commission under this Act.
     ``(3) For purposes of this subsection, the terms `citizens band radio service', `radio
control service', `aircraft station' and `ship station' shall have the meanings given them by the
Commission by rule.''.
     (j) Expedited Licensing for Fixed Microwave Service.--Section 309(b)(2) (47 U.S.C.
309(b)(2)) is amended by striking subparagraph (A) and redesignating subparagraphs (B) through
(G) as subparagraphs (A) through (F), respectively.
     (k) Foreign Directors.--Section 310(b) (47 U.S.C. 310(b)) is amended--
          (1) in paragraph (3), by striking ``of which any officer or director is an alien or'';
     and
          (2) in paragraph (4), by striking ``of which any officer or more than one-fourth of
     the directors are aliens, or''.
     (l) Limitation on Silent Station Authorizations.--Section 312 (47 U.S.C. 312) is
amended by adding at the end the following:
     ``(g) If a broadcasting station fails to transmit broadcast signals for any consecutive 12-month period, then the station license granted for the operation of that broadcast station expires
at the end of that period, notwithstanding any provision, term, or condition of the license to the
contrary.''.
     (m) Modification of Construction Permit Requirement.--Section 319(d) is
amended by striking the last two sentences and inserting the following: ``With respect to any
broadcasting station, the Commission shall not have any authority to waive the requirement of a
permit for construction, except that the Commission may by regulation determine that a permit
shall not be required for minor changes in the facilities of authorized broadcast stations. With
respect to any other station or class of stations, the Commission shall not waive the requirement
for a construction permit unless the Commission determines that the public interest, convenience,
and necessity would be served by such a waiver.''.
     (n) Conduct of Inspections.--Section 362(b) (47 U.S.C. 362(b)) is amended to read as
follows:
     ``(b) Every ship of the United States that is subject to this part shall have the equipment
and apparatus prescribed therein inspected at least once each year by the Commission or an entity
designated by the Commission. If, after such inspection, the Commission is satisfied that all
relevant provisions of this Act and the station license have been complied with, the fact shall be
so certified on the station license by the Commission. The Commission  shall make such
additional inspections at frequent intervals as the Commission determines may be necessary to
ensure compliance with the requirements of this Act. The Commission may, upon a finding that
the public interest could be served thereby--
          ``(1) waive the annual inspection required under this section for a period of up to
     90 days for the sole purpose of enabling a vessel to complete its voyage and proceed to a
     port in the United States where an inspection can be held; or
          ``(2) waive the annual inspection required under this section for a vessel that is in
     compliance with the radio provisions of the Safety Convention and that is operating
     solely in waters beyond the jurisdiction of the United States, provided that such
     inspection shall be performed within 30 days of such vessel's return to the United States.''.
     (o) Inspection by Other Entities.--Section 385 (47 U.S.C. 385) is amended--
          (1) by inserting ``or an entity designated by the Commission'' after ``The
     Commission''; and
          (2) by adding at the end thereof the following: ``In accordance with such other
     provisions of law as apply to Government contracts, the Commission may enter into
     contracts with any person for the purpose of carrying out such inspections and certifying
     compliance with those requirements, and may, as part of any such contract, allow any
     such person to accept reimbursement from the license holder for travel and expense costs
     of any employee conducting an inspection or certification.''.

                TITLE V--OBSCENITY AND VIOLENCE
  Subtitle A--Obscene, Harassing, and Wrongful Utilization of
                 Telecommunications Facilities
                                
SEC. 501. SHORT TITLE.
     This title may be cited as the ``Communications Decency Act of 1996''.

SEC. 502. OBSCENE OR HARASSING USE OF TELECOMMUNICATIONS
FACILITIES UNDER THE COMMUNICATIONS ACT OF 1934.
     Section 223 (47 U.S.C. 223) is amended--
          (1) by striking subsection (a) and inserting in lieu thereof:
     ``(a) Whoever--
          ``(1) in interstate or foreign communications--
               ``(A) by means of a telecommunications device knowingly--
                    ``(i) makes, creates, or solicits, and
                    ``(ii) initiates the transmission of,
          any comment, request, suggestion, proposal, image, or other communication
          which is obscene, lewd, lascivious, filthy, or indecent, with intent to annoy, abuse,
          threaten, or harass another person;
               ``(B) by means of a telecommunications device knowingly--
                    ``(i) makes, creates, or solicits, and
                    ``(ii) initiates the transmission of,
          any comment, request, suggestion, proposal, image, or other communication
          which is obscene or indecent, knowing that the recipient of the communication is
          under 18 years of age, regardless of whether the maker of such communication
          placed the call or initiated the communication;
               ``(C) makes a telephone call or utilizes a telecommunications device,
          whether or not conversation or communication ensues, without disclosing his
          identity and with intent to annoy, abuse, threaten, or harass any person at the
          called number or who receives the communications;
               ``(D) makes or causes the telephone of another repeatedly or continuously
          to ring, with intent to harass any person at the called number; or
               ``(E) makes repeated telephone calls or repeatedly initiates communication
          with a telecommunications device, during which conversation or communication
          ensues, solely to harass any person at the called number or who receives the
          communication; or
          ``(2) knowingly permits any telecommunications facility under his control to be
     used for any activity prohibited by paragraph (1) with the intent that it be used for such
     activity,
shall be fined under title 18, United States Code, or imprisoned not more than two years, or
both.''; and 
          (2) by adding at the end the following new subsections: 
     ``(d) Whoever--
          ``(1) in interstate or foreign communications knowingly--
               ``(A) uses an interactive computer service to send to a specific person or
          persons under 18 years of age, or
               ``(B) uses any interactive computer service to display in a manner
          available to a person under 18 years of age,
     any comment, request, suggestion, proposal, image, or other communication that, in
     context, depicts or describes, in terms patently offensive as measured by contemporary
     community standards, sexual or excretory activities or organs, regardless of whether the
     user of such service placed the call or initiated the communication; or 
          ``(2) knowingly permits any telecommunications facility under such person's
     control to be used for an activity prohibited by paragraph (1) with the intent that it be
     used for such activity,
shall be fined under title 18, United States Code, or imprisoned not more than two years, or both. 
     ``(e) In addition to any other defenses available by law:
          ``(1) No person shall be held to have violated subsection (a) or (d) solely for
     providing access or connection to or from a facility, system, or network not under that
     person's control, including transmission, downloading, intermediate storage, access
     software, or other related capabilities that are incidental to providing such access or
     connection that does not include the creation of the content of the communication.
          ``(2) The defenses provided by paragraph (1) of this subsection shall not be
     applicable to a person who is a conspirator with an entity actively involved in the creation
     or knowing distribution of communications that violate this section, or who knowingly
     advertises the availability of such communications.
          ``(3) The defenses provided in paragraph (1) of this subsection shall not be
     applicable to a person who provides access or connection to a facility, system, or network
     engaged in the violation of this section that is owned or controlled by such person.
          ``(4) No employer shall be held liable under this section for the actions of an
     employee or agent unless the employee's or agent's conduct is within the scope of his or
     her employment or agency and the employer (A) having knowledge of such conduct,
     authorizes or ratifies such conduct, or (B) recklessly disregards such conduct.
          ``(5) It is a defense to a prosecution under subsection (a)(1)(B) or (d), or under
     subsection (a)(2) with respect to the use of a facility for an activity under subsection
     (a)(1)(B) that a person--
               ``(A) has taken, in good faith, reasonable, effective, and appropriate
          actions under the circumstances to restrict or prevent access by minors to a
          communication specified in such subsections, which may involve any appropriate
          measures to restrict minors from such communications, including any method
          which is feasible under available technology; or
               ``(B) has restricted access to such communication by requiring use of a
          verified credit card, debit account, adult access code, or adult personal
          identification number.
          ``(6) The Commission may describe measures which are reasonable, effective,
     and appropriate to restrict access to prohibited communications under subsection (d).
     Nothing in this section authorizes the Commission to enforce, or is intended to provide
     the Commission with the authority to approve, sanction, or permit, the use of such
     measures. The Commission shall have no enforcement authority over the failure to utilize
     such measures. The Commission shall not endorse specific products relating to such
     measures. The use of such measures shall be admitted as evidence of good faith efforts
     for purposes of paragraph (5) in any action arising under subsection (d). Nothing in this
     section shall be construed to treat interactive computer services as common carriers or
     telecommunications carriers.
     ``(f)(1) No cause of action may be brought in any court or administrative agency against
any person on account of any activity that is not in violation of any law punishable by criminal or
civil penalty, and that the person has taken in good faith to implement a defense authorized under
this section or otherwise to restrict or prevent the transmission of, or access to, a communication
specified in this section.
     ``(2) No State or local government may impose any liability for commercial activities or
actions by commercial entities, nonprofit libraries, or institutions of higher education in
connection with an activity or action described in subsection (a)(2) or (d) that is inconsistent with
the treatment of those activities or actions under this section: Provided, however, That nothing
herein shall preclude any State or local government from enacting and enforcing complementary
oversight, liability, and regulatory systems, procedures, and requirements, so long as such
systems, procedures, and requirements govern only intrastate services and do not result in the
imposition of inconsistent rights, duties or obligations on the provision of interstate services.
Nothing in this subsection shall preclude any State or local government from governing conduct
not covered by this section.
     ``(g) Nothing in subsection (a), (d), (e), or (f) or in the defenses to prosecution under (a)
or (d) shall be construed to affect or limit the application or enforcement of any other Federal
law.
     ``(h) For purposes of this section--
          ``(1) The use of the term `telecommunications device' in this section--
               ``(A) shall not impose new obligations on broadcasting station licensees
          and cable operators covered by obscenity and indecency provisions elsewhere in
          this Act; and
               ``(B) does not include an interactive computer service.
          ``(2) The term `interactive computer service' has the meaning provided in section
     230(e)(2).
          ``(3) The term `access software' means software (including client or server
     software) or enabling tools that do not create or provide the content of the communication
     but that allow a user to do any one or more of the following:
               ``(A) filter, screen, allow, or disallow content;
               ``(B) pick, choose, analyze, or digest content; or
               ``(C) transmit, receive, display, forward, cache, search, subset, organize,
          reorganize, or translate content.
          ``(4) The term `institution of higher education' has the meaning provided in
     section 1201 of the Higher Education Act of 1965 (20 U.S.C. 1141).
          ``(5) The term `library' means a library eligible for participation in State-based
     plans for funds under title III of the Library Services and Construction Act (20 U.S.C.
     355e et seq.).''.

SEC. 503. OBSCENE PROGRAMMING ON CABLE TELEVISION.
     Section 639 (47 U.S.C. 559) is amended by striking ``not more than $10,000'' and
inserting ``under title 18, United States Code,''.

SEC. 504. SCRAMBLING OF CABLE CHANNELS FOR NONSUBSCRIBERS. 
     Part IV of title VI (47 U.S. C. 551 et seq.) is amended by adding at the end the following:

``SEC. 640. SCRAMBLING OF CABLE CHANNELS FOR NONSUBSCRIBERS. 
     ``(a) Subscriber Request.--Upon request by a cable service subscriber, a cable operator
shall, without charge, fully scramble or otherwise fully block the audio and video programming
of each channel carrying such programming so that one not a subscriber does not receive it.
     ``(b) Definition.--As used in this section, the term `scramble' means to rearrange the
content of the signal of the programming so that the programming cannot be viewed or heard in
an understandable manner.''.

SEC. 505. SCRAMBLING OF SEXUALLY EXPLICIT ADULT VIDEO SERVICE
PROGRAMMING.
     (a) Requirement.--Part IV of title VI (47 U.S.C. 551 et seq.), as amended by this Act, is
further amended by adding at the end the following:

``SEC. 641. SCRAMBLING OF SEXUALLY EXPLICIT ADULT VIDEO SERVICE
PROGRAMMING.
     ``(a) Requirement.--In providing sexually explicit adult programming or other
programming that is indecent on any channel of its service primarily dedicated to sexually-oriented programming, a multichannel video programming distributor shall fully scramble or
otherwise fully block the video and audio portion of such channel so that one not a subscriber to
such channel or programming does not receive it.
     ``(b) Implementation.--Until a multichannel video programming distributor complies
with the requirement set forth in subsection (a), the distributor shall limit the access of children
to the programming referred to in that subsection by not providing such programming during the
hours of the day (as determined by the Commission) when a significant number of children are
likely to view it.
     ``(c) Definition.--As used in this section, the term `scramble' means to rearrange the
content of the signal of the programming so that the programming cannot be viewed or heard in
an understandable manner.''.
     (b) Effective Date.--The amendment made by subsection (a) shall take effect 30 days
after the date of enactment of this Act.

SEC. 506. CABLE OPERATOR REFUSAL TO CARRY CERTAIN PROGRAMS. 
     (a) Public, Educational, and Governmental Channels.--Section 611(e) (47 U.S.C.
531(e)) is amended by inserting before the period the following: ``, except a cable operator may
refuse to transmit any public access program or portion of a public access program which
contains obscenity, indecency, or nudity''.
     (b) Cable Channels for Commercial Use.--Section 612(c)(2) (47 U.S.C. 532(c)(2)) is
amended by striking ``an operator'' and inserting ``a cable operator may refuse to transmit any
leased access program or portion of a leased access program which contains obscenity,
indecency, or nudity and''. 

SEC. 507. CLARIFICATION OF CURRENT LAWS REGARDING COMMUNICATION
OF OBSCENE MATERIALS THROUGH THE USE OF COMPUTERS.
     (a) Importation or Transportation.--Section 1462 of title 18, United States Code, is
amended--
          (1) in the first undesignated paragraph, by inserting ``or interactive computer
     service (as defined in section 230(e)(2) of the Communications Act of 1934)'' after
     ``carrier''; and
          (2)  in the second undesignated paragraph--
               (A) by inserting ``or receives,'' after ``takes''; 
               (B) by inserting ``or interactive computer service (as defined in section
          230(e)(2) of the Communications Act of 1934)'' after ``common carrier''; and
               (C) by inserting ``or importation'' after ``carriage''.
     (b) Transportation for Purposes of Sale or Distribution.--The first undesignated
paragraph of section 1465 of title 18, United States Code, is amended--
          (1) by striking ``transports in'' and inserting ``transports or travels in, or uses a
     facility or means of,''; 
          (2) by inserting ``or an interactive computer service (as defined in section
     230(e)(2) of the Communications Act of 1934) in or affecting such commerce'' after
     ``foreign commerce'' the first place it appears;
          (3) by striking ``, or knowingly travels in'' and all that follows through ``obscene
     material in interstate or foreign commerce,'' and inserting ``of''.
     (c) Interpretation.--The amendments made by this section are clarifying and shall not
be interpreted to limit or repeal any prohibition contained in sections 1462 and 1465 of title 18,
United States Code, before such amendment, under the rule established in United States v.
Alpers, 338 U.S. 680 (1950).

SEC. 508. COERCION AND ENTICEMENT OF MINORS.
     Section 2422 of title 18, United States Code, is amended--
          (1) by inserting ``(a)'' before ``Whoever knowingly''; and
          (2) by adding at the end the following:
     ``(b) Whoever, using any facility or means of interstate or foreign commerce, including
the mail, or within the special maritime and territorial jurisdiction of the United States,
knowingly persuades, induces, entices, or coerces any individual who has not attained the age of
18 years to engage in prostitution or any sexual act for which any person may be criminally
prosecuted, or attempts to do so, shall be fined under this title or imprisoned not more than 10
years, or both.''.

SEC. 509. ONLINE FAMILY EMPOWERMENT.
     Title II of the Communications Act of 1934 (47 U.S.C. 201 et seq.) is amended by adding
at the end the following new section:

``SEC. 230. PROTECTION FOR PRIVATE BLOCKING AND SCREENING OF
OFFENSIVE MATERIAL.
     ``(a) Findings.--The Congress finds the following:
          ``(1) The rapidly developing array of Internet and other interactive computer
     services available to individual Americans represent an extraordinary advance in the
     availability of educational and informational resources to our citizens.
          ``(2) These services offer users a great degree of control over the information that
     they receive, as well as the potential for even greater control in the future as technology
     develops.
          ``(3) The Internet and other interactive computer services offer a forum for a true
     diversity of political discourse, unique opportunities for cultural development, and
     myriad avenues for intellectual activity.
          ``(4) The Internet and other interactive computer services have flourished, to the
     benefit of all Americans, with a minimum of government regulation.
          ``(5) Increasingly Americans are relying on interactive media for a variety of
     political, educational, cultural, and entertainment services.
     ``(b) Policy.--It is the policy of the United States--
          ``(1) to promote the continued development of the Internet and other interactive
     computer services and other interactive media;
          ``(2) to preserve the vibrant and competitive free market that presently exists for
     the Internet and other interactive computer services,  unfettered by Federal or State
     regulation;
          ``(3) to encourage the development of technologies which maximize user control
     over what information is received by individuals, families, and schools who use the
     Internet and other interactive computer services;
          ``(4) to remove disincentives for the development and utilization of blocking and
     filtering technologies that empower parents to restrict their children's access to
     objectionable or inappropriate online material; and
          ``(5) to ensure vigorous enforcement of Federal criminal laws to deter and punish
     trafficking in obscenity, stalking, and harassment by means of computer.
     ``(c) Protection for `Good Samaritan' Blocking and Screening of Offensive
Material.--
          ``(1) Treatment of publisher or speaker.--No provider or user of an
     interactive computer service shall be treated as the publisher or speaker of any
     information provided by another information content provider.
          ``(2) Civil liability.--No provider or user of an interactive computer service
     shall be held liable on account of--
               ``(A) any action voluntarily taken in good faith to restrict access to or
          availability of material that the provider or user considers to be obscene, lewd,
          lascivious, filthy, excessively violent, harassing, or otherwise objectionable,
          whether or not such material is constitutionally protected; or
               ``(B) any action taken to enable or make available to information content
          providers or others the technical means to restrict access to material described in
          paragraph (1). 
     ``(d) Effect on Other Laws.--
          ``(1) No effect on criminal law.--Nothing in this section shall be construed to
     impair the enforcement of section 223 of this Act, chapter 71 (relating to obscenity) or
     110 (relating to sexual exploitation of children) of title 18, United States Code, or any
     other Federal criminal statute.
          ``(2) No effect on intellectual property law.--Nothing in this section shall
     be construed to limit or expand any law pertaining to intellectual property.
          ``(3) State law.--Nothing in this section shall be construed to prevent any State
     from enforcing any State law that is consistent with this section. No cause of action may
     be brought and no liability may be imposed under any State or local law that is
     inconsistent with this section.
          ``(4) No effect on communications privacy law.--Nothing in this section
     shall be construed to limit the application of the Electronic Communications Privacy Act
     of 1986 or any of the amendments made by such Act, or any similar State law.
     ``(e) Definitions.--As used in this section:
          ``(1) Internet.--The term `Internet' means the international computer network of
     both Federal and non-Federal interoperable packet switched data networks.
          ``(2) Interactive computer service.--The term `interactive computer service'
     means any information service, system, or access software provider that provides or
     enables computer access by multiple users to a computer server, including specifically a
     service or system that provides access to the Internet and such systems operated or
     services offered by libraries or educational institutions.
          ``(3) Information content provider.--The term `information content provider'
     means any person or entity that is responsible, in whole or in part, for the creation or
     development of information provided through the Internet or any other interactive
     computer service.
          ``(4) Access software provider.--The term `access software provider' means a
     provider of software (including client or server software), or enabling tools that do any
     one or more of the following:
               ``(A) filter, screen, allow, or disallow content;
               ``(B) pick, choose, analyze, or digest content; or
               ``(C) transmit, receive, display, forward, cache, search, subset, organize,
          reorganize, or translate content.''.
                                
                       Subtitle Bviolence
                                
SEC. 551. PARENTAL CHOICE IN TELEVISION PROGRAMMING.
     (a) Findings.--The Congress makes the following findings:
          (1) Television influences children's perception of the values and behavior that are
     common and acceptable in society.
          (2) Television station operators, cable television system operators, and video
     programmers should follow practices in connection with video programming that take
     into consideration that television broadcast and cable programming has established a
     uniquely pervasive presence in the lives of American children.
          (3) The average American child is exposed to 25 hours of television each week
     and some children are exposed to as much as 11 hours of television a day.
          (4) Studies have shown that children exposed to violent video programming at a
     young age have a higher tendency for violent and aggressive behavior later in life than
     children not so exposed, and that children exposed to violent video programming are
     prone to assume that acts of violence are acceptable behavior.
          (5) Children in the United States are, on average, exposed to an estimated 8,000
     murders and 100,000 acts of violence on television by the time the child completes
     elementary school.
          (6) Studies indicate that children are affected by the pervasiveness and casual
     treatment of sexual material on television, eroding the ability of parents to develop
     responsible attitudes and behavior in their children.
          (7) Parents express grave concern over violent and sexual video programming and
     strongly support technology that would give them greater control to block video
     programming in the home that they consider harmful to their children.
          (8) There is a compelling governmental interest in empowering parents to limit
     the negative influences of video programming that is harmful to children.
          (9) Providing parents with timely information about the nature of upcoming video
     programming and with the technological tools that allow them easily to block violent,
     sexual, or other programming that they believe harmful to their children is a nonintrusive
     and narrowly tailored means of achieving that compelling governmental interest.
     (b) Establishment of Television Rating Code.--
          (1) Amendment.--Section 303 (47 U.S.C. 303) is amended by adding at the end
     the following:
     ``(w) Prescribe--
          ``(1) on the basis of recommendations from an advisory committee established by
     the Commission in accordance with section 551(b)(2) of the Telecommunications Act of
     1996, guidelines and recommended procedures for the identification and rating of video
     programming that contains sexual, violent, or other indecent material about which parents
     should be informed before it is displayed to children, provided that nothing in this
     paragraph shall be construed to authorize any rating of video programming on the basis of
     its political or religious content; and
          ``(2) with respect to any video programming that has been rated, and in
     consultation with the television industry, rules requiring distributors of such video
     programming to transmit such rating to permit parents to block the display of video
     programming that they have determined is inappropriate for their children.''.
          (2) Advisory committee requirements.--In establishing an advisory committee
     for purposes of the amendment made by paragraph (1) of this subsection, the
     Commission shall--
               (A) ensure that such committee is composed of parents, television
          broadcasters, television programming producers, cable operators, appropriate
          public interest groups, and other interested individuals from the private sector and
          is fairly balanced in terms of political affiliation, the points of view represented,
          and the functions to be performed by the committee; 
               (B) provide to the committee such staff and resources as may be necessary
          to permit it to perform its functions efficiently and promptly; and
               (C) require the committee to submit a final report of its recommendations
          within one year after the date of the appointment of the initial members.
     (c) Requirement for Manufacture of Televisions That Block Programs.--Section
303 (47 U.S.C. 303), as amended by subsection (a), is further amended by adding at the end the
following:
     ``(x) Require, in the case of an apparatus designed to receive television signals that are
shipped in interstate commerce or manufactured in the United States and that have a picture
screen 13 inches or greater in size (measured diagonally), that such apparatus be equipped with a
feature designed to enable viewers to block display of all programs with a common rating, except
as otherwise permitted by regulations pursuant to section 330(c)(4).''.
     (d) Shipping of Televisions That Block Programs.--
          (1) Regulations.--Section 330 (47 U.S.C. 330) is amended--
               (A) by redesignating subsection (c) as subsection (d); and 
               (B) by adding after subsection (b) the following new subsection (c):

     ``(c)(1) Except as provided in paragraph (2), no person shall ship in interstate commerce
or manufacture in the United States any apparatus described in section 303(x) of this Act except
in accordance with rules prescribed by the Commission pursuant to the authority granted by that
section. 
     ``(2) This subsection shall not apply to carriers transporting apparatus referred to in
paragraph (1) without trading in it.
     ``(3) The rules prescribed by the Commission under this subsection shall provide for the
oversight by the Commission of the adoption of standards by industry for blocking technology.
Such rules shall require that all such apparatus be able to receive the rating signals which have
been transmitted by way of line 21 of the vertical blanking interval and which conform to the
signal and blocking specifications established by industry under the supervision of the
Commission. 
     ``(4) As new video technology is developed, the Commission shall take such action as the
Commission determines appropriate to ensure that blocking service continues to be available to
consumers. If the Commission determines that an alternative blocking technology exists that--
          ``(A) enables parents to block programming based on identifying programs
     without ratings,
          ``(B) is available to consumers at a cost which is comparable to the cost of
     technology that allows parents to block programming based on common ratings, and
          ``(C) will allow parents to block a broad range of programs on a multichannel
     system as effectively and as easily as technology that allows parents to block
     programming based on common ratings, 
the Commission shall amend the rules prescribed pursuant to section 303(x) to require that the
apparatus described in such section be equipped with either the blocking technology described in
such section or the alternative blocking technology described in this paragraph.''.
          (2) Conforming amendment.--Section 330(d), as redesignated by subsection
     (d)(1)(A), is amended by striking ``section 303(s), and section 303(u)'' and inserting in
     lieu thereof ``and sections 303(s), 303(u), and 303(x)''.
     (e) Applicability and Effective Dates.--
          (1) Applicability of rating provision.--The amendment made by subsection
     (b) of this section shall take effect 1 year after the date of enactment of this Act, but only
     if the Commission determines, in consultation with appropriate public interest groups and
     interested individuals from the private sector, that distributors of video programming
     have not, by such date--
               (A) established voluntary rules for rating video programming that contains
          sexual, violent, or other indecent material about which parents should be informed
          before it is displayed to children, and such rules are acceptable to the
          Commission; and
               (B) agreed voluntarily to broadcast signals that contain ratings of such
          programming.
          (2) Effective date of manufacturing provision.--In prescribing regulations to
     implement the amendment made by subsection (c), the Federal Communications
     Commission shall, after consultation with the television manufacturing industry, specify
     the effective date for the applicability of the requirement to the apparatus covered by such
     amendment, which date shall not be less than two years after the date of enactment of this
     Act.

SEC. 552. TECHNOLOGY FUND.
     It is the policy of the United States to encourage broadcast television, cable, satellite,
syndication, other video programming distributors, and relevant related industries (in
consultation with appropriate public interest groups and interested individuals from the private
sector) to--
          (1) establish a technology fund to encourage television and electronics equipment
     manufacturers to facilitate the development of technology which would empower parents
     to block programming they deem inappropriate for their children and to encourage the
     availability thereof to low income parents;
          (2) report to the viewing public on the status of the development of affordable,
     easy to use blocking technology; and
          (3) establish and promote effective procedures, standards, systems, advisories, or
     other mechanisms for ensuring that users have easy and complete access to the
     information necessary to effectively utilize blocking technology and to encourage the
     availability thereof to low income parents.
                                
                  Subtitle C--Judicial Review
                                
SEC. 561. EXPEDITED REVIEW.
     (a) Three-Judge District Court Hearing.--Notwithstanding any other provision of
law, any civil action challenging the constitutionality, on its face, of this title or any amendment
made by this title, or any provision thereof, shall be heard by a district court of 3 judges
convened pursuant to the provisions of section 2284 of title 28, United States Code.
     (b) Appellate Review.--Notwithstanding any other provision of law, an interlocutory or
final judgment, decree, or order of the court of 3 judges in an action under subsection (a) holding
this title or an amendment made by this title, or any provision thereof, unconstitutional shall be
reviewable as a matter of right by direct appeal to the Supreme Court. Any such appeal shall be
filed not more than 20 days after entry of such judgment, decree, or order.

                 TITLE VI--EFFECT ON OTHER LAWS
                                
SEC. 601. APPLICABILITY OF CONSENT DECREES AND OTHER LAW.
     (a) Applicability of Amendments to Future Conduct.--
          (1) AT&T consent decree.--Any conduct or activity that was, before the date of
     enactment of this Act, subject to any restriction or obligation imposed by the AT&T
     Consent Decree shall, on and after such date, be subject to the restrictions and obligations
     imposed by the Communications Act of 1934 as amended by this Act and shall not be
     subject to the restrictions and the obligations imposed by such Consent Decree.
          (2) GTE consent decree.--Any conduct or activity that was, before the date of
     enactment of this Act, subject to any restriction or obligation imposed by the GTE
     Consent Decree shall, on and after such date, be subject to the restrictions and obligations
     imposed by the Communications Act of 1934 as amended by this Act and shall not be
     subject to the restrictions and the obligations imposed by such Consent Decree.
          (3) McCaw consent decree.--Any conduct or activity that was, before the date
     of enactment of this Act, subject to any restriction or obligation imposed by the McCaw
     Consent Decree shall, on and after such date, be subject to the restrictions and obligations
     imposed by the Communications Act of 1934 as amended by this Act and subsection (d)
     of this section and shall not be subject to the restrictions and the obligations imposed by
     such Consent Decree.
     (b) Antitrust Laws.--
          (1) Savings clause.--Except as provided in paragraphs (2) and (3), nothing in
     this Act or the amendments made by this Act shall be construed to modify, impair, or
     supersede the applicability of any of the antitrust laws.
          (2) Repeal.--Subsection (a) of section 221 (47 U.S.C. 221(a)) is repealed.
          (3) Clayton act.--Section 7 of the Clayton Act (15 U.S.C. 18) is amended in the
     last paragraph by striking ``Federal Communications Commission,''.
     (c) Federal, State, and Local Law.--
          (1) No implied effect.--This Act and the amendments made by this Act shall not
     be construed to modify, impair, or supersede Federal, State, or local law unless expressly
     so provided in such Act or amendments.
          (2) State tax savings provision.--Notwithstanding paragraph (1), nothing in
     this Act or the amendments made by this Act shall be construed to modify, impair, or
     supersede, or authorize the modification, impairment, or supersession of, any State or
     local law pertaining to taxation, except as provided in sections 622 and 653(c) of the
     Communications Act of 1934 and section 602 of this Act.
     (d) Commercial Mobile Service Joint Marketing.--Notwithstanding section 22.903
of the Commission's regulations (47 C.F.R. 22.903) or any other Commission regulation, a Bell
operating company or any other company may, except as provided in sections 271(e)(1) and 272
of the Communications Act of 1934 as amended by this Act as they relate to wireline service,
jointly market and sell commercial mobile services in conjunction with telephone exchange
service, exchange access, intraLATA telecommunications service, interLATA
telecommunications service, and information services.
     (e) Definitions.--As used in this section:
          (1) AT&T consent decree.--The term ``AT&T Consent Decree'' means the order
     entered August 24, 1982, in the antitrust action styled United States v. Western Electric,
     Civil Action No. 82	0192, in the United States District Court for the District of
     Columbia, and includes any judgment or order with respect to such action entered on or
     after August 24, 1982.
          (2) GTE consent decree.--The term ``GTE Consent Decree'' means the order
     entered December 21, 1984, as restated January 11, 1985, in the action styled United
     States v. GTE Corp., Civil Action No. 83	1298, in the United States District Court for
     the District of Columbia, and any judgment or order with respect to such action entered
     on or after December 21, 1984.
          (3) McCaw consent decree.--The term ``McCaw Consent Decree'' means the
     proposed consent decree filed on July 15, 1994, in the antitrust action styled United
     States v. AT&T Corp. and McCaw Cellular Communications, Inc., Civil Action No. 94-01555, in the United States District court for the District of Columbia. Such term includes
     any stipulation that the parties will abide by the terms of such proposed consent decree
     until it is entered and any order entering such proposed consent decree.
          (4) Antitrust laws.--The term ``antitrust laws'' has the meaning given it in
     subsection (a) of the first section of the Clayton Act (15 U.S.C. 12(a)), except that such
     term includes the Act of June 19, 1936 (49 Stat. 1526; 15 U.S.C. 13 et seq.), commonly
     known as the Robinson-Patman Act, and section 5 of the Federal Trade Commission Act
     (15 U.S.C. 45) to the extent that such section 5 applies to unfair methods of competition.

SEC. 602. PREEMPTION OF LOCAL TAXATION WITH RESPECT TO DIRECT-TO-HOME SERVICES.
     (a) Preemption.--A provider of direct-to-home satellite service shall be exempt from the
collection or remittance, or both, of any tax or fee imposed by any local taxing jurisdiction on
direct-to-home satellite service.
     (b) Definitions.--For the purposes of this section--
          (1) Direct-to-home satellite service.--The term ``direct-to-home satellite
     service'' means only programming transmitted or broadcast by satellite directly to the
     subscribers' premises without the use of ground receiving or distribution equipment,
     except at the subscribers' premises or in the uplink process to the satellite.
          (2) Provider of direct-to-home satellite service.--For purposes of this
     section, a ``provider of direct-to-home satellite service'' means a person who transmits,
     broadcasts, sells, or distributes direct-to-home satellite service.
          (3) Local taxing jurisdiction.--The term ``local taxing jurisdiction'' means any
     municipality, city, county, township, parish, transportation district, or assessment
     jurisdiction, or any other local jurisdiction in the territorial jurisdiction of the  United
     States with the authority to impose a tax or fee, but does not include a State.
          (4) State.--The term ``State'' means any of the several States, the District of
     Columbia, or any territory or possession of the United States.
          (5) Tax or fee.--The terms ``tax'' and ``fee'' mean any local sales tax, local use
     tax, local intangible tax, local income tax, business license tax, utility tax, privilege tax,
     gross receipts tax, excise tax, franchise fees, local telecommunications tax, or any other
     tax, license, or fee that is imposed for the privilege of doing business, regulating, or
     raising revenue for a local taxing jurisdiction.
     (c) Preservation of State Authority.--This section shall not be construed to prevent
taxation of a provider of direct-to-home satellite service by a State or to prevent a local taxing
jurisdiction from receiving revenue derived from a tax or fee imposed and collected by a State.

              TITLE VII--MISCELLANEOUS PROVISIONS
                                
SEC. 701. PREVENTION OF UNFAIR BILLING PRACTICES FOR INFORMATION
OR SERVICES PROVIDED OVER TOLL-FREE TELEPHONE CALLS.
     (a) Prevention of Unfair Billing Practices.--
          (1) In general.--Section 228(c) (47 U.S.C. 228(c)) is amended--
               (A) by striking out subparagraph (C) of paragraph (7) and inserting in lieu
          thereof the following:
               ``(C) the calling party being charged for information conveyed during the
          call unless--
                    ``(i) the calling party has a written agreement (including an
               agreement transmitted through electronic medium) that meets the
               requirements of paragraph (8); or
                    ``(ii) the calling party is charged for the information in accordance
               with paragraph (9); or'';
               (B)(i) by striking ``or'' at the end of subparagraph (C) of such paragraph; 
               (ii) by striking the period at the end of subparagraph (D) of such paragraph
          and inserting a semicolon and ``or''; and
               (iii) by adding at the end thereof the following: 
               ``(E) the calling party being assessed, by virtue of being asked to connect
          or otherwise transfer to a pay-per-call service, a charge for the call.''; and
               (C) by adding at the end the following new paragraphs:
          ``(8) Subscription agreements for billing for information provided via
     toll-free calls.--
               ``(A) In general.--For purposes of paragraph (7)(C)(i), a written
          subscription does not meet the requirements of this paragraph unless the
          agreement specifies the material terms and conditions under which the
          information is offered and includes--
                    ``(i) the rate at which charges are assessed for the information;
                    ``(ii) the information provider's name;
                    ``(iii) the information provider's business address;
                    ``(iv) the information provider's regular business telephone
               number;
                    ``(v) the information provider's agreement to notify the subscriber
               at least one billing cycle in advance of all future changes in the rates
               charged for the information; and
                    ``(vi) the subscriber's choice of payment method, which may be by
               direct remit, debit, prepaid account, phone bill, or credit or calling card.
               ``(B) Billing arrangements.--If a subscriber elects, pursuant to
          subparagraph (A)(vi), to pay by means of a phone bill--
                    ``(i) the agreement shall clearly explain that the subscriber will be
               assessed for calls made to the information service from the subscriber's
               phone line; 
                    ``(ii) the phone bill shall include, in prominent type, the following
               disclaimer:
                         `Common carriers may not disconnect local or long
                    distance telephone service for failure to pay disputed charges for
                    information services.'; and
                    ``(iii) the phone bill shall clearly list the 800 number dialed.
               ``(C) Use of pins to prevent unauthorized use.--A written agreement
          does not meet the requirements of this paragraph unless it--
                    ``(i) includes a unique personal identification number or other
               subscriber-specific identifier and requires a subscriber to use this number
               or identifier to obtain access to the information provided and includes
               instructions on its use; and
                    ``(ii) assures that any charges for services accessed by use of the
               subscriber's personal identification number or subscriber-specific identifier
               be assessed to subscriber's source of payment elected pursuant to
               subparagraph (A)(vi).
               ``(D) Exceptions.--Notwithstanding paragraph (7)(C), a written
          agreement that meets the requirements of this paragraph is not required--
                    ``(i) for calls utilizing telecommunications devices for the deaf;
                    ``(ii) for directory services provided by a common carrier or its
               affiliate or by a local exchange carrier or its affiliate; or
                    ``(iii) for any purchase of goods or of services that are not
               information services.
               ``(E) Termination of service.--On receipt by a common carrier of a
          complaint by any person that an information provider is in violation of the
          provisions of this section, a carrier shall--
                    ``(i) promptly investigate the complaint; and 
                    ``(ii) if the carrier reasonably determines that the complaint is
               valid, it may terminate the provision of service to an information provider
               unless the provider supplies evidence of a written agreement that meets the
               requirements of this section. 
               ``(F) Treatment of remedies.--The remedies provided in this paragraph
          are in addition to any other remedies that are available under title V of this Act.
          ``(9) Charges by credit, prepaid, debit, charge, or calling card in absence
     of agreement.--For purposes of paragraph (7)(C)(ii), a calling party is not charged in
     accordance with this paragraph unless the calling party is charged by means of a credit,
     prepaid, debit, charge, or calling card and the information service provider includes in
     response to each call an introductory disclosure message that--
               ``(A) clearly states that there is a charge for the call;
               ``(B) clearly states the service's total cost per minute and any other fees for
          the service or for any service to which the caller may be transferred;
               ``(C) explains that the charges must be billed on either a credit, prepaid,
          debit, charge, or calling card;
               ``(D) asks the caller for the card number;
               ``(E) clearly states that charges for the call begin at the end of the
          introductory message; and
               ``(F) clearly states that the caller can hang up at or before the end of the
          introductory message without incurring any charge whatsoever.
          ``(10) Bypass of introductory disclosure message.--The requirements of
     paragraph (9) shall not apply to calls from repeat callers using a bypass mechanism to
     avoid listening to the introductory message, provided that information providers shall
     disable such a bypass mechanism after the institution of any price increase and for a
     period of time determined to be sufficient by the Federal Trade Commission to give
     callers adequate and sufficient notice of a price increase.
          ``(11) Definition of calling card.--As used in this subsection, the term `calling
     card' means an identifying number or code unique to the individual, that is issued to the
     individual by a common carrier and enables the individual to be charged by means of a
     phone bill for charges incurred independent of where the call originates.''.
          (2) Regulations.--The Federal Communications Commission shall revise its
     regulations to comply with the amendment made by paragraph (1) not later than 180 days
     after the date of enactment of this Act. 
          (3) Effective date.--The amendments made by paragraph (1) shall take effect on
     the date of enactment of this Act.
     (b) Clarification of ``Pay-Per-Call Services''.--
          (1) Telephone disclosure and dispute resolution act.--Section 204(1) of the
     Telephone Disclosure and Dispute Resolution Act (15 U.S.C. 5714(1)) is amended to
     read as follows:
          ``(1) The term `pay-per-call services' has the meaning provided in section 228(i)
     of the Communications Act of 1934, except that the Commission by rule may,
     notwithstanding subparagraphs (B) and (C) of section 228(i)(1) of such Act, extend such
     definition to other similar services providing audio information or audio entertainment if
     the Commission determines that such services are susceptible to the unfair and deceptive
     practices that are prohibited by the rules prescribed pursuant to section 201(a).''.
          (2) Communications act.--Section 228(i)(2) (47 U.S.C. 228(i)(2)) is amended
     by striking ``or any service the charge for which is tariffed,''.

SEC. 702. PRIVACY OF CUSTOMER INFORMATION.
     Title II is amended by inserting after section 221 (47 U.S.C. 221) the following new
section:

``SEC. 222. PRIVACY OF CUSTOMER INFORMATION.
     ``(a) In General.--Every telecommunications carrier has a duty to protect the
confidentiality of proprietary information of, and relating to, other telecommunication carriers,
equipment manufacturers, and customers, including telecommunication carriers reselling
telecommunications services provided by a telecommunications carrier.
     ``(b) Confidentiality of Carrier Information.--A telecommunications carrier that
receives or obtains proprietary information from another carrier for purposes of providing any
telecommunications service shall use such information only for such purpose, and shall not use
such information for its own marketing efforts.
     ``(c) Confidentiality of Customer Proprietary Network Information.--
          ``(1) Privacy requirements for telecommunications carriers.--Except as
     required by law or with the approval of the customer, a telecommunications carrier that
     receives or obtains customer proprietary network information by virtue of its provision of
     a telecommunications service shall only use, disclose, or permit access to individually
     identifiable customer proprietary network information in its provision of (A) the
     telecommunications service from which such information is derived, or (B) services
     necessary to, or used in, the provision of such telecommunications service, including the
     publishing of directories.
          ``(2) Disclosure on request by customers.--A telecommunications carrier
     shall disclose customer proprietary network information, upon affirmative written request
     by the customer, to any person designated by the customer.
          ``(3) Aggregate customer information.--A telecommunications carrier that
     receives or obtains customer proprietary network information by virtue of its provision of
     a telecommunications service may use, disclose, or permit access to aggregate customer
     information other than for the purposes described in paragraph (1). A local exchange
     carrier may use, disclose, or permit access to aggregate customer information other than
     for purposes described in paragraph (1) only if it provides such aggregate information to
     other carriers or persons on reasonable and nondiscriminatory terms and conditions upon
     reasonable request therefor.
     ``(d) Exceptions.--Nothing in this section prohibits a telecommunications carrier from
using, disclosing, or permitting access to customer proprietary network information obtained
from its customers, either directly or indirectly through its agents--
          ``(1) to initiate, render, bill, and collect for telecommunications services;
          ``(2) to protect the rights or property of the carrier, or to protect users of those
     services and other carriers from fraudulent, abusive, or unlawful use of, or subscription
     to, such services; or
          ``(3) to provide any inbound telemarketing, referral, or administrative services to
     the customer for the duration of the call, if such call was initiated by the customer and the
     customer approves of the use of such information to provide such service.
     ``(e) Subscriber List Information.--Notwithstanding subsections (b), (c), and (d), a
telecommunications carrier that provides telephone exchange service shall provide subscriber list
information gathered in its capacity as a provider of such service on a timely and unbundled
basis, under nondiscriminatory and reasonable rates, terms, and conditions, to any person upon
request for the purpose of publishing directories in any format.
     ``(f) Definitions.--As used in this section:
          ``(1) Customer proprietary network information.--The term `customer
     proprietary network information' means--

               ``(A) information that relates to the quantity, technical configuration, type,
          destination, and amount of use of a telecommunications service subscribed to by
          any customer of a telecommunications carrier, and that is made available to the
          carrier by the customer solely by virtue of the carrier-customer relationship; and
               ``(B) information contained in the bills pertaining to telephone exchange
          service or telephone toll service received by a customer of a carrier; 
     except that such term does not include subscriber list information.
          ``(2) Aggregate information.--The term `aggregate customer information'
     means collective data that relates to a group or category of services or customers, from
     which individual customer identities and characteristics have been removed.
          ``(3) Subscriber list information.--The term `subscriber list information'
     means any information--
               ``(A) identifying the listed names of subscribers of a carrier and such
          subscribers' telephone numbers, addresses, or primary advertising classifications
          (as such classifications are assigned at the time of the establishment of such
          service), or any combination of such listed names, numbers, addresses, or
          classifications; and
               ``(B) that the carrier or an affiliate has published, caused to be published,
          or accepted for publication in any directory format.''.

SEC. 703. POLE ATTACHMENTS.
     Section 224 (47 U.S.C. 224) is amended--
          (1) in subsection (a)(1), by striking the first sentence and inserting the following:
     ``The term `utility' means any person who is a local exchange carrier or an electric, gas,
     water, steam, or other public utility, and who owns or controls poles, ducts, conduits, or
     rights-of-way used, in whole or in part, for any wire communications.'';
          (2) in subsection (a)(4), by inserting after ``system'' the following: ``or provider of
     telecommunications service'';
          (3) by inserting after subsection (a)(4) the following:
          ``(5) For purposes of this section, the term `telecommunications carrier' (as
     defined in section 3 of this Act) does not include any incumbent local exchange carrier as
     defined in section 251(h).'';
          (4) by inserting after ``conditions'' in subsection (c)(1) a comma and the
     following: ``or access to poles, ducts, conduits, and rights-of-way as provided in
     subsection (f),'':
          (5) in subsection (c)(2)(B), by striking ``cable television services'' and inserting
     ``the services offered via such attachments'';
          (6) by inserting after subsection (d)(2) the following:
          ``(3) This subsection shall apply to the rate for any pole attachment used by a
     cable television system solely to provide cable service. Until the effective date of the
     regulations required under subsection (e), this subsection shall also apply to the rate for
     any pole attachment used by a cable system or any telecommunications carrier (to the
     extent such carrier is not a party to a pole attachment agreement) to provide any
     telecommunications service.''; and 
          (7) by adding at the end thereof the following:
     ``(e)(1) The Commission shall, no later than 2 years after the date of enactment of the
Telecommunications Act of 1996, prescribe regulations in accordance with this subsection to
govern the charges for pole attachments used by telecommunications carriers to provide
telecommunications services, when the parties fail to resolve a dispute over such charges. Such
regulations shall ensure that a utility charges just, reasonable, and nondiscriminatory rates for
pole attachments. 
     ``(2) A utility shall apportion the cost of providing space on a pole, duct, conduit, or
right-of-way other than the usable space among entities so that such apportionment equals two-thirds of the costs of providing space other than the usable space that would be allocated to such
entity under an equal apportionment of such costs among all attaching entities.
     ``(3) A utility shall apportion the cost of providing usable space among all entities
according to the percentage of usable space required for each entity. 
     ``(4) The regulations required under paragraph (1) shall become effective 5 years after the
date of enactment of the Telecommunications Act of 1996. Any increase in the rates for pole
attachments that result from the adoption of the regulations required by this subsection shall be
phased in equal annual increments over a period of 5 years beginning on the effective date of
such regulations. 
     ``(f)(1) A utility shall provide a cable television system or any telecommunications carrier
with nondiscriminatory access to any pole, duct, conduit, or right-of-way owned or controlled by
it.
     ``(2) Notwithstanding paragraph (1), a utility providing electric service may deny a cable
television system or any telecommunications carrier access to its poles, ducts, conduits, or rights-of-way, on a non-discriminatory basis where there is insufficient capacity and for reasons of
safety, reliability and generally applicable engineering purposes.
     ``(g) A utility that engages in the provision of telecommunications services or cable
services shall impute to its costs of providing such services (and charge any affiliate, subsidiary,
or associate company engaged in the provision of such services) an equal amount to the pole
attachment rate for which such company would be liable under this section.
     ``(h) Whenever the owner of a pole, duct, conduit, or right-of-way intends to modify or
alter such pole, duct, conduit, or right-of-way, the owner shall provide written notification of
such action to any entity that has obtained an attachment to such conduit or right-of-way so that
such entity may have a reasonable opportunity to add to or modify its existing attachment. Any
entity that adds to or modifies its existing attachment after receiving such notification shall bear a
proportionate share of the costs incurred by the owner in making such pole, duct, conduit, or
right-of-way accessible.
     ``(i) An entity that obtains an attachment to a pole, conduit, or right-of-way shall not be
required to bear any of the costs of rearranging or replacing its attachment, if such rearrangement
or replacement is required as a result of an additional attachment or the modification of an
existing attachment sought by any other entity (including the owner of such pole, duct, conduit,
or right-of-way).''.

SEC. 704. FACILITIES SITING; RADIO FREQUENCY EMISSION STANDARDS.
     (a) National Wireless Telecommunications Siting Policy.--Section 332(c) (47
U.S.C. 332(c)) is amended by adding at the end the following new paragraph:
          ``(7) Preservation of local zoning authority.--
               ``(A) General authority.--Except as provided in this paragraph, nothing
          in this Act shall limit or affect the authority of a State or local government or
          instrumentality thereof over decisions regarding the placement, construction, and
          modification of personal wireless service facilities.
               ``(B) Limitations.--
                    ``(i) The regulation of the placement, construction, and
               modification of personal wireless service facilities by any State or local
               government or instrumentality thereof--
                         ``(I) shall not unreasonably discriminate among providers
                    of functionally equivalent services; and
                         ``(II) shall not prohibit or have the effect of prohibiting the
                    provision of personal wireless services.
                    ``(ii) A State or local government or instrumentality thereof shall
               act on any request for authorization to place, construct, or modify personal
               wireless service facilities within a reasonable period of time after the
               request is duly filed with such government or instrumentality, taking into
               account the nature and scope of such request.
                    ``(iii) Any decision by a State or local government or
               instrumentality thereof to deny a request to place, construct, or modify
               personal wireless service facilities shall be in writing and supported by
               substantial evidence contained in a written record.
                    ``(iv) No State or local government or instrumentality thereof may
               regulate the placement, construction, and modification of personal wireless
               service facilities on the basis of the environmental effects of radio
               frequency emissions to the extent that such facilities comply with the
               Commission's regulations concerning such emissions.
                    ``(v) Any person adversely affected by any final action or failure to
               act by a State or local government or any instrumentality thereof that is
               inconsistent with this subparagraph may, within 30 days after such action
               or failure to act, commence an action in any court of competent
               jurisdiction. The court shall hear and decide such action on an expedited
               basis. Any person adversely affected by an act or failure to act by a State
               or local government or any instrumentality thereof that is inconsistent with
               clause (iv) may petition the Commission for relief.
               ``(C) Definitions.--For purposes of this paragraph--
                    ``(i) the term `personal wireless services' means commercial
               mobile services, unlicensed wireless services, and common carrier
               wireless exchange access services;
                    ``(ii) the term `personal wireless service facilities' means facilities
               for the provision of personal wireless services; and
                    ``(iii) the term `unlicensed wireless service' means the offering of
               telecommunications services using duly authorized devices which do not
               require individual licenses, but does not mean the provision of direct-to-home satellite services (as defined in section 303(v)).''.
     (b) Radio Frequency Emissions.--Within 180 days after the enactment of this Act, the
Commission shall complete action in ET Docket 93	62 to prescribe and make effective rules
regarding the environmental effects of radio frequency emissions.
     (c) Availability of Property.--Within 180 days of the enactment of this Act, the
President or his designee shall prescribe procedures by which Federal departments and agencies
may make available on a fair, reasonable, and nondiscriminatory basis, property, rights-of-way,
and easements under their control for the placement of new telecommunications services that are
dependent, in whole or in part, upon the utilization of Federal spectrum rights for the
transmission or reception of such services. These procedures may establish a presumption that
requests for the use of property, rights-of-way, and easements by duly authorized providers
should be granted absent unavoidable direct conflict with the department or agency's mission, or
the current or planned use of the property, rights-of-way, and easements in question. Reasonable
fees may be charged to providers of such telecommunications services for use of property, rights-of-way, and easements. The Commission shall provide technical support to States to encourage
them to make property, rights-of-way, and easements under their jurisdiction available for such
purposes.

SEC. 705. MOBILE SERVICES DIRECT ACCESS TO LONG DISTANCE CARRIERS.
     Section 332(c) (47 U.S.C. 332(c)) is amended by adding at the end the following new
paragraph:
          ``(8) Mobile services access.--A person engaged in the provision of
     commercial mobile services, insofar as such person is so engaged, shall not be required to
     provide equal access to common carriers for the provision of telephone toll services. If
     the Commission determines that subscribers to such services are denied access to the
     provider of telephone toll services of the subscribers' choice, and that such denial is
     contrary to the public interest, convenience, and necessity, then the Commission shall
     prescribe regulations to afford subscribers unblocked access to the provider of telephone
     toll services of the subscribers' choice through the use of a carrier identification code
     assigned to such provider or other mechanism. The requirements for unblocking shall not
     apply to mobile satellite services unless the Commission finds it to be in the public
     interest to apply such requirements to such services.''.

SEC. 706. ADVANCED TELECOMMUNICATIONS INCENTIVES.
     (a) In General.--The Commission and each State commission with regulatory
jurisdiction over telecommunications services shall encourage the deployment on a reasonable
and timely basis of advanced telecommunications capability to all Americans (including, in
particular, elementary and secondary schools and classrooms) by utilizing, in a manner consistent
with the public interest, convenience, and necessity, price cap regulation, regulatory forbearance,
measures that promote competition in the local telecommunications market, or other regulating
methods that remove barriers to infrastructure investment.
     (b) Inquiry.--The Commission shall, within 30 months after the date of enactment of this
Act, and regularly thereafter, initiate a notice of inquiry concerning the availability of advanced
telecommunications capability to all Americans (including, in particular, elementary and
secondary schools and classrooms) and shall complete the inquiry within 180 days after its
initiation. In the inquiry, the Commission shall determine whether advanced telecommunications
capability is being deployed to all Americans in a reasonable and timely fashion. If the
Commission's determination is negative, it shall take immediate action to accelerate deployment
of such capability by removing barriers to infrastructure investment and by promoting
competition in the telecommunications market.
     (c) Definitions.--For purposes of this subsection:
          (1) Advanced telecommunications capability.--The term ``advanced
     telecommunications capability'' is defined, without regard to any transmission media or
     technology, as high-speed, switched, broadband telecommunications capability that
     enables users to originate and receive high-quality voice, data, graphics, and video
     telecommunications using any technology. 
          (2) Elementary and secondary schools.--The term ``elementary and
     secondary schools'' means elementary and secondary schools, as defined in paragraphs
     (14) and (25), respectively, of section 14101 of the Elementary and Secondary Education
     Act of 1965 (20 U.S.C. 8801).

SEC. 707. TELECOMMUNICATIONS DEVELOPMENT FUND.
     (a) Deposit and Use of Auction Escrow Accounts.--Section 309(j)(8) (47 U.S.C.
309(j)(8)) is amended by adding at the end the following new subparagraph:
               ``(C) Deposit and use of auction escrow accounts.--Any deposits the
          Commission may require for the qualification of any person to bid in a system of
          competitive bidding pursuant to this subsection shall be deposited in an interest
          bearing account at a financial institution designated for purposes of this
          subsection by the Commission (after consultation with the Secretary of the
          Treasury). Within 45 days following the conclusion of the competitive bidding--
                    ``(i) the deposits of successful bidders shall be paid to the
               Treasury;
                    ``(ii) the deposits of unsuccessful bidders shall be returned to such
               bidders; and
                    ``(iii) the interest accrued to the account shall be transferred to the
               Telecommunications Development Fund established pursuant to section
               714 of this Act.''.
     (b) Establishment and Operation of Fund.--Title VII is amended by inserting after
section 713 (as added by section 305) the following new section:

``SEC. 714. TELECOMMUNICATIONS DEVELOPMENT FUND.
     ``(a) Purpose of Section.--It is the purpose of this section--
          ``(1) to promote access to capital for small businesses in order to enhance
     competition in the telecommunications industry;
          ``(2) to stimulate new technology development, and promote employment and
     training; and
          ``(3) to support universal service and promote delivery of telecommunications
     services to underserved rural and urban areas.
     ``(b) Establishment of Fund.--There is hereby established a body corporate to be
known as the Telecommunications Development Fund, which shall have succession until
dissolved. The Fund shall maintain its principal office in the District of Columbia and shall be
deemed, for purposes of venue and jurisdiction in civil actions, to be a resident and citizen
thereof. 
     ``(c) Board of Directors.-- 
          ``(1) Composition of board; chairman.--The Fund shall have a Board of
     Directors which shall consist of 7 persons appointed by the Chairman of the Commission.
     Four of such directors shall be representative of the private sector and three of such
     directors shall be representative of the Commission, the Small Business Administration,
     and the Department of the Treasury, respectively. The Chairman of the Commission shall
     appoint one of the representatives of the private sector to serve as chairman of the Fund
     within 30 days after the date of enactment of this section, in order to facilitate rapid
     creation and implementation of the Fund. The directors shall include members with
     experience in a number of the following areas: finance, investment banking, government
     banking, communications law and administrative practice, and public policy. 
          ``(2) Terms of appointed and elected members.--The directors shall be
     eligible to serve for terms of 5 years, except of the initial members, as designated at the
     time of their appointment--
               ``(A) 1 shall be eligible to service for a term of 1 year;
               ``(B) 1 shall be eligible to service for a term of 2 years;
               ``(C) 1 shall be eligible to service for a term of 3 years;
               ``(D) 2 shall be eligible to service for a term of 4 years; and
               ``(E) 2 shall be eligible to service for a term of 5 years (1 of whom shall be
          the Chairman).
     Directors may continue to serve until their successors have been appointed and have
     qualified. 
          ``(3) Meetings and functions of the board.--The Board of Directors shall
     meet at the call of its Chairman, but at least quarterly. The Board shall determine the
     general policies which shall govern the operations of the Fund. The Chairman of the
     Board shall, with the approval of the Board, select, appoint, and compensate qualified
     persons to fill the offices as may be provided for in the bylaws, with such functions,
     powers, and duties as may be prescribed by the bylaws or by the Board of Directors, and
     such persons shall be the officers of the Fund and shall discharge all such functions,
     powers, and duties.
     ``(d) Accounts of the Fund.--The Fund shall maintain its accounts at a financial
institution designated for purposes of this section by the Chairman of the Board (after
consultation with the Commission and the Secretary of the Treasury). The accounts of the Fund
shall consist of--
          ``(1) interest transferred pursuant to section 309(j)(8)(C) of this Act;
          ``(2) such sums as may be appropriated to the Commission for advances to the
     Fund;
          ``(3) any contributions or donations to the Fund that are accepted by the Fund;
     and
          ``(4) any repayment of, or other payment made with respect to, loans, equity, or
     other extensions of credit made from the Fund.
     ``(e) Use of the Fund.--All moneys deposited into the accounts of the Fund shall be used
solely for------
          ``(1) the making of loans, investments, or other extensions of credits to eligible
     small businesses in accordance with subsection (f);
          ``(2) the provision of financial advice to eligible small businesses;
          ``(3) expenses for the administration and management of the Fund (including
     salaries, expenses, and the rental or purchase of office space for the fund);
          ``(4) preparation of research, studies, or financial analyses; and
          ``(5) other services consistent with the purposes of this section.
     ``(f) Lending and Credit Operations.--Loans or other extensions of credit from the
Fund shall be made available in accordance with the requirements of the Federal Credit Reform
Act of 1990 (2 U.S.C. 661 et seq.) and any other applicable law to an eligible small business on
the basis of--
          ``(1) the analysis of the business plan of the eligible small business;
          ``(2) the reasonable availability of collateral to secure the loan or credit extension;
          ``(3) the extent to which the loan or credit extension promotes the purposes of this
     section; and
          ``(4) other lending policies as defined by the Board.
     ``(g) Return of Advances.--Any advances appropriated pursuant to subsection (d)(2)
shall be disbursed upon such terms and conditions (including conditions relating to the time or
times of repayment) as are specified in any appropriations Act providing such advances.
     ``(h) General Corporate Powers.--The Fund shall have power--
          ``(1) to sue and be sued, complain and defend, in its corporate name and through
     its own counsel;
          ``(2) to adopt, alter, and use the corporate seal, which shall be judicially noticed;
          ``(3) to adopt, amend, and repeal by its Board of Directors, bylaws, rules, and
     regulations as may be necessary for the conduct of its business;
          ``(4) to conduct its business, carry on its operations, and have officers and
     exercise the power granted by this section in any State without regard to any qualification
     or similar statute in any State;
          ``(5) to lease, purchase, or otherwise acquire, own, hold, improve, use, or
     otherwise deal in and with any property, real, personal, or mixed, or any interest therein,
     wherever situated, for the purposes of the Fund;
          ``(6) to accept gifts or donations of services, or of property, real, personal, or
     mixed, tangible or intangible, in aid of any of the purposes of the Fund;
          ``(7) to sell, convey, mortgage, pledge, lease, exchange, and otherwise dispose of
     its property and assets;
          ``(8) to appoint such officers, attorneys, employees, and agents as may be
     required, to determine their qualifications, to define their duties, to fix their salaries,
     require bonds for them, and fix the penalty thereof; and
          ``(9) to enter into contracts, to execute instruments, to incur liabilities, to make
     loans and equity investment, and to do all things as are necessary or incidental to the
     proper management of its affairs and the proper conduct of its business.
     ``(i) Accounting, Auditing, and Reporting.--The accounts of the Fund shall be
audited annually. Such audits shall be conducted in accordance with generally accepted auditing
standards by independent certified public accountants. A report of each such audit shall be
furnished to the Secretary of the Treasury and the Commission. The representatives of the
Secretary and the Commission shall have access to all books, accounts, financial records, reports,
files, and all other papers, things, or property belonging to or in use by the Fund and necessary to
facilitate the audit.
     ``(j) Report on Audits by Treasury.--A report of each such audit for a fiscal year shall
be made by the Secretary of the Treasury to the President and to the Congress not later than 6
months following the close of such fiscal year. The report shall set forth the scope of the audit
and shall include a statement of assets and liabilities, capital and surplus or deficit; a statement of
surplus or deficit analysis; a statement of income and expense; a statement of sources and
application of funds; and such comments and information as may be deemed necessary to keep
the President and the Congress informed of the operations and financial condition of the Fund,
together with such recommendations with respect thereto as the Secretary may deem advisable.
     ``(k) Definitions.--As used in this section:
          ``(1) Eligible small business.--The term `eligible small business' means
     business enterprises engaged in the telecommunications industry that have $50,000,000
     or less in annual revenues, on average over the past 3 years prior to submitting the
     application under this section.
          ``(2) Fund.--The term `Fund' means the Telecommunications Development Fund
     established pursuant to this section.
          ``(3) Telecommunications industry.--The term `telecommunications industry'
     means communications businesses using regulated or unregulated facilities or services
     and includes broadcasting, telecommunications, cable, computer, data transmission,
     software, programming, advanced messaging, and electronics businesses.''.

SEC. 708. NATIONAL EDUCATION TECHNOLOGY FUNDING CORPORATION.
     (a) Findings; Purpose.--
          (1) Findings.--The Congress finds as follows:
               (A) Corporation.--There has been established in the District of
          Columbia a private, nonprofit corporation known as the National Education
          Technology Funding Corporation which is not an agency or independent
          establishment of the Federal Government.
               (B) Board of directors.--The Corporation is governed by a Board of
          Directors, as prescribed in the Corporation's articles of incorporation, consisting
          of 15 members, of which--
                    (i) five members are representative of public agencies
               representative of schools and public libraries;
                    (ii) five members are representative of State government, including
               persons knowledgeable about State finance, technology and education; and
                    (iii) five members are representative of the private sector, with
               expertise in network technology, finance and management.
               (C) Corporate purposes.--The purposes of the Corporation, as set forth
          in its articles of incorporation, are--
                    (i) to leverage resources and stimulate private investment in
               education technology infrastructure;
                    (ii) to designate State education technology agencies to receive
               loans, grants or other forms of assistance from the Corporation;
                    (iii) to establish criteria for encouraging States to--
                         (I) create, maintain, utilize and upgrade interactive high
                    capacity networks capable of providing audio, visual and data
                    communications for elementary schools, secondary schools and
                    public libraries;
                         (II) distribute resources to assure equitable aid to all
                    elementary schools and secondary schools in the State and achieve
                    universal access to network technology; and
                         (III) upgrade the delivery and development of learning
                    through innovative technology-based instructional tools and
                    applications;
                    (iv) to provide loans, grants and other forms of assistance to State
               education technology agencies, with due regard for providing a fair
               balance among types of school districts and public libraries assisted and
               the disparate needs of such districts and libraries;
                    (v) to leverage resources to provide maximum aid to elementary
               schools, secondary schools and public libraries; and
                    (vi) to encourage the development of education
               telecommunications and information technologies through public-private
               ventures, by serving as a clearinghouse for information on new education
               technologies, and by providing technical assistance, including assistance
               to States, if needed, to establish State education technology agencies.
          (2) Purpose.--The purpose of this section is to recognize the Corporation as a
     nonprofit corporation operating under the laws of the District of Columbia, and to
     provide authority for Federal departments and agencies to provide assistance to the
     Corporation.
     (b) Definitions.--For the purpose of this section--
          (1) the term ``Corporation'' means the National Education Technology Funding
     Corporation described in subsection (a)(1)(A);
          (2) the terms ``elementary school'' and ``secondary school'' have the same
     meanings given such terms in section 14101 of the Elementary and Secondary Education
     Act of 1965; and
          (3) the term ``public library'' has the same meaning given such term in section 3 of
     the Library Services and Construction Act.
     (c) Assistance for Education Technology Purposes.--
          (1) Receipt by corporation.--Notwithstanding any other provision of law, in
     order to carry out the corporate purposes described in subsection (a)(1)(C), the
     Corporation shall be eligible to receive discretionary grants, contracts, gifts,
     contributions, or technical assistance from any Federal department or agency, to the
     extent otherwise permitted by law.
          (2) Agreement.--In order to receive any assistance described in paragraph (1) the
     Corporation shall enter into an agreement with the Federal department or agency
     providing such assistance, under which the Corporation agrees--
               (A) to use such assistance to provide funding and technical assistance only
          for activities which the Board of Directors of the Corporation determines are
          consistent with the corporate purposes described in subsection (a)(1)(C);
               (B) to review the activities of State education technology agencies and
          other entities receiving assistance from the Corporation to assure that the
          corporate purposes described in subsection (a)(1)(C) are carried out;
               (C) that no part of the assets of the Corporation shall accrue to the benefit
          of any member of the Board of Directors of the Corporation, any officer or
          employee of the Corporation, or any other individual, except as salary or
          reasonable compensation for services;
               (D) that the Board of Directors of the Corporation will adopt policies and
          procedures to prevent conflicts of interest;
               (E) to maintain a Board of Directors of the Corporation consistent with
          subsection (a)(1)(B);
               (F) that the Corporation, and any entity receiving the assistance from the
          Corporation, are subject to the appropriate oversight procedures of the Congress;
          and
               (G) to comply with--
                    (i) the audit requirements described in subsection (d); and
                    (ii) the reporting and testimony requirements described in
               subsection (e).
          (3) Construction.--Nothing in this section shall be construed to establish the
     Corporation as an agency or independent establishment of the Federal Government, or to
     establish the members of the Board of Directors of the Corporation, or the officers and
     employees of the Corporation, as officers or employees of the Federal Government.
     (d) Audits.--
          (1) Audits by independent certified public accountants.--
               (A) In general.--The Corporation's financial statements shall be audited
          annually in accordance with generally accepted auditing standards by independent
          certified public accountants who are certified by a regulatory authority of a State
          or other political subdivision of the United States. The audits shall be conducted
          at the place or places where the accounts of the Corporation are normally kept. All
          books, accounts, financial records, reports, files, and all other papers, things, or
          property belonging to or in use by the Corporation and necessary to facilitate the
          audit shall be made available to the person or persons conducting the audits, and
          full facilities for verifying transactions with the balances or securities held by
          depositories, fiscal agents, and custodians shall be afforded to such person or
          persons.
               (B) Reporting requirements.--The report of each annual audit described
          in subparagraph (A) shall be included in the annual report required by subsection
          (e)(1).
          (2) Recordkeeping requirements; audit and examination of books.--
               (A) Recordkeeping requirements.--The Corporation shall ensure that
          each recipient of assistance from the Corporation keeps--
                    (i) separate accounts with respect to such assistance;
                    (ii) such records as may be reasonably necessary to fully disclose--
                         (I) the amount and the disposition by such recipient of the
                    proceeds of such assistance;
                         (II) the total cost of the project or undertaking in
                    connection with which such assistance is given or used; and
                         (III) the amount and nature of that portion of the cost of the
                    project or undertaking supplied by other sources; and 
                    (iii) such other records as will facilitate an effective audit.
               (B) Audit and examination of books.--The Corporation shall ensure
          that the Corporation, or any of the Corporation's duly authorized representatives,
          shall have access for the purpose of audit and examination to any books,
          documents, papers, and records of any recipient of assistance from the
          Corporation that are pertinent to such assistance. Representatives of the
          Comptroller General shall also have such access for such purpose.
     (e) Annual Report; Testimony to the Congress.--
          (1) Annual report.--Not later than April 30 of each year, the Corporation shall
     publish an annual report for the preceding fiscal year and submit that report to the
     President and the Congress. The report shall include a comprehensive and detailed
     evaluation of the Corporation's operations, activities, financial condition, and
     accomplishments under this section and may include such recommendations as the
     Corporation deems appropriate.
          (2) Testimony before congress.--The members of the Board of Directors, and
     officers, of the Corporation shall be available to testify before appropriate committees of
     the Congress with respect to the report described in paragraph (1), the report of any audit
     made by the Comptroller General pursuant to this section, or any other matter which any
     such committee may determine appropriate.

SEC. 709. REPORT ON THE USE OF ADVANCED TELECOMMUNICATIONS
SERVICES FOR MEDICAL PURPOSES.
     The Secretary of Commerce, in consultation with the Secretary of Health and Human
Services and other appropriate departments and agencies, shall submit a report to the Committee
on Commerce of the House of Representatives and the Committee on Commerce, Science and
Transportation of the Senate concerning the activities of the Joint Working Group on
Telemedicine, together with any findings reached in the studies and demonstrations on
telemedicine funded by the Public Health Service or other Federal agencies. The report shall
examine questions related to patient safety, the efficacy and quality of the services provided, and
other legal, medical, and economic issues related to the utilization of advanced
telecommunications services for medical purposes. The report shall be submitted to the
respective Committees by January 31, 1997.

SEC. 710. AUTHORIZATION OF APPROPRIATIONS.
     (a) In General.--In addition to any other sums authorized by law, there are authorized to
be appropriated to the Federal Communications Commission such sums as may be necessary to
carry out this Act and the amendments made by this Act.
     (b) Effect on Fees.--For the purposes of section 9(b)(2) (47 U.S.C. 159(b)(2)),
additional amounts appropriated pursuant to subsection (a) shall be construed to be changes in
the amounts appropriated for the performance of activities described in section 9(a) of the
Communications Act of 1934.
     (c) Funding Availability.--Section 309(j)(8)(B) (47 U.S.C. 309(j)(8)(B)) is amended
by adding at the end the following new sentence: ``Such offsetting collections are authorized to
remain available until expended.''.