Japan: Rules Eased on Telecommunications

The Japanese government said Wednesday that it received 13 U.S. demands last week concerning Japanese regulations governing imports of telecommunications equipment, and it released documents indicating that it has satisfied all but three.

The U.S. objections were to rules that Japan put into effect Monday, when it deregulated its telecommunications industry.

Norimasu Hasegawa of the Postal and Telecommunications Ministry’s communications-policy bureau handed foreign correspondents a list of the 13 demands that had been presented to Moriya Koyama, the ministry’s vice minister, by Lionel H. Olmer, undersecretary of commerce, in negotiations that ended in Washington last Thursday. Hasegawa also released Koyama’s replies.

Koyama himself disclosed the contents of the documents Wednesday in testimony to Parliament.

No Judgment Made

Neither Hasegawa nor Koyama made any judgment as to how many of the Japanese replies had satisfied the American demands, but the responses appeared to match the demands on at least 10 points.

American officials here refused to comment, saying, “This one’s being handled in Washington.”

A joint statement issued in Washington on Tuesday by the State and Commerce departments said the two countries had reached “basic understandings on the regulatory regime for the telecommunications sector in Japan which went into effect Monday.”

Olmer and Gaston Sigur, a National Security Council staff member, who met Prime Minister Yasuhiro Nakasone in an emergency meeting here Sunday, cited only the issues of technical standards and the “transparency” of decision-making as yet to be resolved. The “transparency” issue involves the demand that the United States have a chance to be heard on trade matters.

However, the Japanese documents indicate that the three Olmer demands that appear not to have been completely accepted involve the technical standards, regulations affecting “value-added network” (VAN) business and the “transparency” issue.

Expressed ‘Understanding’

Koyama’s letter, which was dated last Thursday, disclosed for the first time that the ministry expressed “understanding” for Olmer’s insistence that administrative procedures be eliminated for firms wishing to enter both small- and large-scale “value-added network” business here. But he pointed out that Parliament would have to amend the law that it passed just last Dec. 20 to eliminate the requirement for such procedures.

Koyama stopped short of promising to amend the law to end all administrative procedures required to enter the VAN business but told Olmer the ministry would amend its ordinances within a year if “major impediments” to U.S. firms were discovered.

Companies entering VAN business, most of which had been a monopoly of Nippon Telegraph & Telephone, will lease lines from the telephone company and provide an “interpreting service” to allow otherwise incompatible computers to communicate. The business, which also allows firms to offer telephone and telex service on the leased lines, is expected to be one of the fastest-growing enterprises under the deregulated telecommunications system that Japan established Monday.

Koyama’s letter failed to accept Olmer’s insistence that Japan limit its technical standards to only those needed to avert damage to Japan’s basic telecommunications network. But he did agree to begin a new round of negotiations aimed at reducing the number and stringency of standards by June 1.

In a second letter that Koyama gave Olmer after Sunday’s emergency meeting with Nakasone, he promised to speed up the new round of negotiations, make Japan’s regulatory process “equitable” with that of the United States and accept the principle that “the choice of terminal equipment and communications protocols should be left to the user.”

The agreement in the second letter also was cited in the joint statement issued by the State and Commerce departments in Washington on Tuesday.

On the issue of transparency in decision-making, Koyama said in his Thursday letter only that the ministry would try to appoint Japanese employees of foreign firms operating in Japan to a standards-setting advisory council or its expert subcommittees “in the near future.” Olmer, according to the documents that Hasegawa gave correspondents, had appealed for Japanese representatives of foreign firms to be named to both the council and its subcommittees--not to one or the other.

Hasegawa said Wednesday that Japan had made no commitment to name foreigners to the decision-making body but said he expected that foreigners would, in fact, be appointed after the legally fixed number of 20 council members, all with two-year terms, is enlarged.

The joint State-Commerce statement, however, said Nakasone had assured Reagan’s two envoys Sunday that “American companies would be represented on bodies that set standards and make rules, and that this, too, would be done at an early date.”

On other issues, Koyama gave Olmer last Thursday what appeared to be straightforward acceptance of American requests for notification and registration procedures (two points in Olmer’s list) and definitions of large-scale VAN service (another two points). He also offered assurances that there would be a single, independent certification agency; that manufacturers would be allowed to self-certify their products and that NTT would not use profits from its phone business to subsidize its VAN services.

Last Thursday’s letter also appeared to meet an American request that Japan establish a procedure for handling complaints. It said the U.S. Embassy here would be allowed to participate in any complaint hearings.

Koyama also promised that the ministry will announce its intention to fix new rules and standards and to allow foreigners to participate in the process from the beginning. Until now, no public announcement has been made until new rules were implemented.

Japan also promised to allow American engineers with U.S. college degrees to be certified for work in telecommunications here, provided that they go through special instruction in Japanese law in courses that the ministry said it would conduct in English for foreigners. Japan originally had proposed to certify only engineers with Japanese college degrees.