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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of) ) Progress International, L.L.C. ) ) Application for Global) Authorization Pursuant to ) File No. I-T-C-97-048 Section 214 of the ) Communications Act of 1934, ) as Amended, to Resell ) International Communications ) Services ) ORDER, AUTHORIZATION AND CERTIFICATE Adopted: July 7, 1997 Released: July 9, 1997 By the Chief, Telecommunications Division: I. Introduction 1. In this Order, Authorization and Certificate ("Order") we grant Progress International, L.L.C ("Progress") global authority to provide international basic switched and private line telecommunications services on a resale basis. We also find that Progress qualifies for non-dominant regulatory treatment on the U.S.-Mexico route. II. Background 2. Progress, a limited liability company organized under the laws of Texas, is composed of two member companies: Link Net International, Inc. ("Link Net") and Westel International, Inc. ("Westel"). Each has a 50 percent ownership interest in Progress. Link Net and Westel have Section 214 authorizations to provide international switched telecommunications services on a resale basis. Progress holds a 49 percent ownership interest in MarcaTel, S.A. de C.V. ("MarcaTel"), a competitive long distance and international telecommunications carrier in Mexico. 3. On January 22, 1997, Progress filed an application requesting Section 214 authorization, pursuant to Section 63.18(e)(2) of the Commission's Rules, to resell international services. Progress requested classification as a non-dominant carrier in its provision of international resale services on all routes including Mexico. 4. Progress claims that Telef˘nos de Mexico ("Telmex"), the de jure monopoly telecommunications service provider in Mexico prior to January 1, 1997, continues to be Mexico's de facto monopoly service provider. Progress states that its affiliate in Mexico, MarcaTel, has an insignificant market share, no market power, and is not a local exchange carrier. Hence, Progress argues that MarcaTel does not have the ability to discriminate against unaffiliated U.S. international carriers through control of bottleneck services or facilities in Mexico. 5. In accordance with Section 63.18(h)(3) of the Commission's Rules, Progress certifies that it is not affiliated with any U.S. international carrier whose facilities-based switched services Progress proposes to resell. Progress also certifies, pursuant to Section 63.18(i), that it has not agreed to accept any special concessions directly or indirectly from any foreign carrier or foreign administration with respect to traffic or revenue flows between the United States and any foreign country which Progress may serve under the authority granted to it and that it will not enter into any such agreements in the future. III. Discussion 6. Under the framework adopted in Regulation of International Common Carrier Services and Section 63.10(a)(4) of the Commission's Rules, a reseller of unaffiliated U.S. facilities-based carriers' switched services is entitled to a presumption that it will be regulated as non-dominant. The Commission has found that such resale "presents no substantial possibility of anticompetitive effects in the U.S. international service market because the reseller's foreign affiliate is negotiating the terms and conditions of access to the destination market with an unaffiliated carrier on the U.S. end." 7. While Progress is affiliated with a Mexican carrier, MarcaTel, the record indicates that Progress will provide telecommunications services, including services to Mexico, solely through the resale of unaffiliated U.S. facilities-based carriers' international services. Thus, Progress is entitled to the presumption that it be classified as non-dominant. 8. We find that Progress's foreign carrier affiliation does not give any reason to overcome this presumption, especially in light of the fact that Telmex has the only ubiquitous facilities-based local exchange network in Mexico. As a recently licensed provider of competitive long distance and international telecommunications services in Mexico, MarcaTel has a limited market share, no market power, and a lack of control over bottleneck services or facilities. MarcaTel, therefore, does not have the ability to discriminate against unaffiliated U.S. international carriers terminating traffic in Mexico. As a result, we find that Progress should be regulated as a non-dominant carrier for global services between the United States and other countries, including Mexico. 9. The Commission will allow Progress, as a non-dominant reseller of international switched services, to file tariffs on no less than one day's notice, without economic or cost support, and will presume the tariffs are lawful. Progress must comply with the Section 214 requirements for non-dominant U.S. international carriers. 10. As a non-dominant carrier, Progress will be subject to regulation under Title II of the Act. Sections 201 and 202 of Title II require carriers to offer international services under rates, terms and conditions that are just, reasonable and not unduly discriminatory. Sections 206 through 209 subject Title II carriers to the Commission's complaint process. Title II carriers must file tariffs pursuant to our streamlined tarrifing procedures. Non- dominant U.S. international switched resellers must also comply with the requirements of Sections 43.51, 43.61, 63.14 and 63.19 of the Commission's Rules. IV. Ordering Clauses 11. Upon consideration of the application, IT IS HEREBY CERTIFIED that present and future public convenience and necessity require the provision of international switched and private line telecommunications services on a resale basis by Progress. 12. Accordingly, IT IS ORDERED that Progress's application, File No. I-T-C-97- 048, requesting global resale authority pursuant to the terms and conditions of Section 63.18(e)(2) of the Commission's Rules on a non-dominant carrier basis, IS GRANTED. 13. IT IS FURTHER ORDERED that Progress shall comply with the requirements specified in Section 63.21 of the Commission's Rules, 47 C.F.R.  63.21. 14. This Order is issued under Section 0.261 of the Commission's Rules and is effective upon adoption. Petitions for reconsideration under Section 1.106 or application for review under Section 1.115 of the Commission's Rules may be filed within 30 days of the date of public notice of this Order (see Section 1.4(b)(2)). FEDERAL COMMUNICATIONS COMMISSION Diane J. Cornell Chief, Telecommunications Division International Bureau