use the most closely substitutable radio-based service in the home market, as determined from the customers' perspective."

27

17. MICL asserts that the Chilean international telecommunications services market represents the relevant market segment for our ECO analysis. We disagree. MICL currently holds licenses for two earth stations that it uses to provide common carrier services on both a resale and facilities basis between the United States and international points. We, therefore, believe that the relevant market segment is more narrow than Chile's entire international telecommunications market. Instead, we conclude that the licensing and operation of earth stations in Chile represents the appropriate market segment for our ECO analysis.

18. As explained in the Foreign Carrier Entry Order, once we have identified the appropriate market segment within the appropriate home market, we determine whether effective competitive opportunities are available to U.S. companies and investors. The initial focus of an ECO analysis is on de jure restrictions to entry. To the extent they are relevant, we also consider practical, or de facto, limitations on U.S. participation, including the price, terms and conditions of interconnection, competitive safeguards, and the regulatory framework in the relevant market.28

19. If, after conducting an ECO analysis, we determine that the laws of the relevant home market allow U.S. entities to hold a controlling interest in a provider of the relevant service, then we would be justified in placing no limit on the level of ownership that a foreign entity from that home market can acquire in the U.S. licensee, absent significant de facto barriers. If we determine, however, that the relevant home market places legal limitations on the ability of U.S. entities to acquire and hold a controlling interest in a provider of the relevant service, then we would allow the foreign entity to exceed the 25 percent statutory foreign ownership benchmark only up to the level of ownership available to U.S. entities in that foreign market."

20. After applying an ECO analysis to MICL's application, we find that Chile has no de jure or de facto restrictions on licensing and operation of earth stations in Chile by U.S. companies. The Commission previously concluded in its AmericaTel decision that "there are no relevant legal restrictions on the ability of U.S. and other foreign entities to invest in the

Chilean international long distance telecommunications marketplace or to obtain licenses to operate as international facilities-based long distance carriers."30 This is demonstrated by the fact that Chile already has substantial foreign investment in, and use of, earth stations to provide international telecommunications services. For example, BellSouth/Chile, a whollyowned subsidiary of BellSouth, has received a concession to provide international telecommunications services using earth stations in competition with Chilean companies such as Chilesat.31

21. The Commission has previously stated that "Chile's liberalized telecommunications regulatory environment. . . [has] progressed substantially in promoting competition and preventing abuse of market power.' 32 To ensure free and open competition, Chile allows private ownership of telephone companies and places no limitations on the number of carriers that may obtain operating licenses and provide international telecommunications services via earth stations in Chile. Chile also provides other competitive safeguards, including structural separation of local and long distance companies, periodic review of Chile's telecommunications markets by the Anti-Monopoly Commission, implementation of a multi-carrier dialing system," mandatory sharing of network information among carriers, prohibitions against discriminatory interconnection arrangements,34 and no price controls except in those sectors of Chile's telecommunications market that are not yet competitive.

35

22. In sum, Chile's laws and regulatory environment allow U.S. entities to hold a controlling interest in Chilean earth stations used for the provision of international telecommunications services, and also safeguard against anticompetitive conduct, including discrimination against foreign-owned carriers. Thus, we find that Chile offers effective competitive opportunities for U.S. carriers in the licensing and operation of earth stations.

Application for Transfer of Control at 14. Southwestern Bell (VTR Telecomunicaciones), Bell Atlantic (lusatel), Telefónica de España S.A. (CTC Mundo), and lusacell (lusatel) also hold interests in other Chilean carriers that provide international long distance services. Id.

AmericaTel Corporation, 10 FCC Rcd 12157 (1995), citing Transfer of Control Order.

Chile's multi-carrier dialing system requires local exchange carriers to allow subscribers to select the long distance carrier of their choice on a presubscribed or per-call basis. Transfer of Control Order at ¶ 35.

We note, however, that Chile's interconnection regime is not relevant to the ECO analysis for this
Application.

23. Our review of public interest factors other than those covered by the ECO analysis also supports approval of MICL's application. The Executive Branch has not raised any national security, law enforcement, foreign policy or trade concerns with regard to MICL's application. Moreover, we find, as we did in our analysis under Section 214 of the Act above, that the proposed transfer of control of MICL would serve the public interest by allowing the provision of additional investment and expertise to MICL, which will help a small U.S. carrier like MICL compete in the increasingly competitive U.S. international telecommunications market.

IV. Conclusion

24. Applying the rules and standards adopted in the Foreign Carrier Entry Order. we conclude that granting MICL's application will serve the public interest under both Sections 214 and 310 of the Act. Our analysis under Section 310(b)(4) demonstrates that Chile offers U.S. companies effective opportunities in the licensing and operation of earth stations. Furthermore, allowing the provision of additional investment and expertise to small U.S. carriers like MICL will increase competition in the U.S. international telecommunications market. As the Commission has previously determined, increased competition "fosters lower prices, innovative services, and increased responsiveness to consumer needs."36

V. Ordering Clauses

25. IT IS HEREBY CERTIFIED that the present and future public convenience and necessity require a grant of the application of Melbourne International Communications. Ltd. ("MICL").

26. Accordingly, IT IS ORDERED, pursuant to Sections 214 and 310 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 214, 310, and Section 25.118 of the Commission's Rules, 47 C.F.R. § 25.118, that MICL's application, File Nos. 1940-DSE-TC96(2) and I-T-C-96-492(TC), IS GRANTED. Thus, we consent to the transfer by Wajay Investments, Inc., of up to 70.1 percent of MICL's equity to Invertel, Inc.

27. This Order is issued pursuant to Section 0.261 of the Commission's Rules, 47 C.F.R. § 0.261, and is effective upon adoption. Petitions for reconsideration under Section

1.106 of the Commission's Rules, 47 C.F.R. § 1.106, or applications for review under Section 1.115 of the Commission's Rules, 47 C.F.R. § 1.115, may be filed within 30 days of the public notice of this Order (see Section 1.4(b)(2) of the Commission's Rules, 47 C.F.R. § 1.4(b)(2)).

FEDERAL COMMUNICATIONS COMMISSION

Donald H. Gips

Chief, International Bureau

By the Chief, Financial Analysis and Compliance Division, Cable Services Bureau:

1. In this Order we consider a complaint filed concerning the rates of Multi-Channel TV Cable Company d/b/a Adelphia Cable Communications ("Adelphia") for its cable programming services tiers ("CPST") CPST-1 and CPST-2 in Albemarle County, Virginia, CUID No. VA0075. Adelphia has chosen to justify its CPST rates through a cost of service showing on FCC Form 1220, an FCC Form 1210, and an FCC Form 1240. This Order addresses the reasonableness of Adelphia's CPST rates from October 1993 to present.

2. Under the Communications Act,' the Federal Communications Commission ("Commission") is authorized to review the CPST rates of cable systems not subject to effective competition to ensure that rates charged are not unreasonable. If the Commission finds the rate to be unreasonable, it shall determine the correct rate and any refund liability.2 The Commission received a valid complaint concerning Adelphia's CPST rates in effect in October 1993.3 Accordingly, this complaint triggers the Commission's jurisdiction to review Adelphia's CPST

'The commission received a valid complaint against Adelphia on November 3, 1993. The complaint challenges several CPST rate increases including rate increases that Adelphia instituted before Adelphia was subject to rate regulation. This Order only addresses the reasonableness of Adelphia's CPST rates after it became subject to rate regulation on September 1, 1993.