The Federal Communications Commission (FCC), the United States telecoms regulator, believes any legal challenge to its move to impose cuts in fees paid between international phone companies will probably fail, a former high ranking official of the organisation says.
Last month, Hongkong Telecom and nine other Asian carriers began legal efforts to stop the FCC taking a unilateral decision to cut these so-called settlement rates.
'The view of the FCC's legal counsel is that there is a very good likelihood that any legal challenge would be turned back and not sustained,' former chief of the FCC's international bureau, Pete Cowhey, said.
Mr Cowhey, who left the FCC last month, was speaking at an Institute of International Research conference in Hong Kong.
Settlement rates are the fees international phone companies pay one another for handling each other's calls.
The FCC is proposing to go ahead with swingeing cuts in the settlement rates it pays to the rest of the world.
In the case of Hong Kong, it wants to cut the figure from about 37 US cents a minute to what it terms a benchmark of about 15 cents a minute by the start of 1999.