*EPF506 02/28/2003
U.S. Urges Japan to Halt Planned Telephone Connection Rate Hike
(But other regulatory reforms moving forward, says USTR's Huntsman) (450)

By Berta Gomez
Washington File Staff Writer

Washington -- U.S. officials are strongly urging the Japanese government to reconsider a plan that would allow Nippon Telegraph and Telephone (NTT) to raise its connection charges to other carriers, saying the move is "entirely unjustified" and likely to further stifle competition, Deputy U.S. Trade Representative Jon Huntsman says.

In a telephone press conference with reporters following the February 27-28 meeting in Washington of the U.S.-Japan Regulatory Reform and Competition Policy Initiative, Huntsman said the "lively" bilateral talks had produced both good and bad news with respect to Japan's reform efforts.

The United States is particularly unhappy with Japan's plan to hike the wireline interconnection rates by as much as 12 percent by April 1, Huntsman said.

Huntsman described the Japanese response to U.S. objections as "not promising." He underlined, however, that U.S. officials "will continue working this issue very aggressively."

The talks, led by Huntsman and Japanese Deputy Foreign Minister Ichiro Fujisaki, were part of an initiative launched by President Bush and Japanese Prime Minister Junichiro Koizumi in 2001. Under the initiative, officials from each country meet on a regular basis to exchange recommendations and compare notes on ways to promote sustained economic growth.

Huntsman said that, from the U.S. perspective, the initiative had produced encouraging results in a number of areas. He praised Japanese government moves to encourage more competition among mobile telephone operators and to further liberalize its energy markets.

The United States welcomes the Koizumi government's plan to extend copyright protection for films to 70 years, Huntsman said. He described the copyright bill as "significant but perhaps incomplete," citing the U.S. position that such copyright protection should be extended to other works as well.

U.S. officials are similarly pleased with Japanese government efforts to increase the independence of Japan's Fair Trade Commission (JFTC) by moving it out of the Ministry of Public Management, Home Affairs, Posts and Telecommunication (MPHPT) and into the prime minister's cabinet.

Japan's extension of customs clearance hours to 24 hours a day should help facilitate trade, including express delivery services, Huntsman said.

He also said that Japan's experiments with deregulation zones are producing "encouraging results," adding: "We hope these measures will lead to nationwide deregulation."

Huntsman said U.S. and Japanese officials working on the regulatory reform initiative would meet in Tokyo in May and would prepare a report for Bush and Koizumi ahead of the meeting of G-8 (Group of Eight countries France, Germany, Japan, United Kingdom, Italy, United States, Canada and Russia) leaders scheduled for early June in France.

(The Washington File is a product of the Office of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)

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