
                                                                 Exhibit 10-39



                              LICENCE GRANTED BY

               THE SECRETARY OF STATE FOR TRADE AND INDUSTRY TO

                           ACC LONG DISTANCE UK LTD

              UNDER SECTION 7 OF THE TELECOMMUNICATIONS ACT 1984
                               18 December 1996


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                              TABLE OF CONTENTS


THE LICENCE


SCHEDULE 1:  CONDITIONS INCLUDED UNDER SECTION 7 OF THE ACT


PART 1:      Definitions and interpretation relating to the Conditions in
             Schedule 1


PART 2:      Special Conditions referred to in section 8 of the Act

1            Requirement to provide telecommunication services

2            Directory Information

3            Public Emergency Call Services

4            Planning and implementation of special arrangements for
             Emergencies

5            Requirement to provide Connection Services and connection of
             apparatus

6            Provision by others of services by means of the Applicable
             Systems

7            Publication of charges, terms and conditions to be applied

8            Prohibition on undue preference and undue discrimination


PART 3:      Other Conditions included under section 7 of the Act

9            Maintenance of effective competition where the licensee
             operates a system or provides services overseas

10           Fair Trading

11           Essential Interfaces

12           Customer Interface Standards

13           Metering and Billing Arrangements

14           Numbering arrangements

15           Arrangements for proportionate return

16           Arrangements for parallel accounting

17           Prohibition of exclusive dealing in international services

18           Notification of changes in Shareholdings

19           Licensee's Group

20           Payment of fees

21           Requirement to furnish information to the Director

22           Requirement to submit accounts to the Director

23           Exceptions and limitations on obligations in Schedule 1


SCHEDULE 2:  REVOCATION


SCHEDULE 3:  AUTHORISATION TO CONNECT OTHER TELECOMMUNICATION
             SYSTEMS AND APPARATUS TO THE APPLICABLE SYSTEMS AND TO
             PROVIDE TELECOMMUNICATION SERVICES BY MEANS OF THE
             APPLICABLE SYSTEMS


<PAGE>

                              LICENCE GRANTED BY
               THE SECRETARY OF STATE FOR TRADE AND INDUSTRY TO
                           ACC LONG DISTANCE UK LTD
              UNDER SECTION 7 OF THE TELECOMMUNICATIONS ACT 1984


THE LICENCE

1            The Secretary of State, in exercise of the powers conferred
on him by section 7 of the Telecommunications Act 1984 (hereinafter
referred to as "the Act") and after consulting the Director hereby
grants to ACC Long Distance UK Ltd (hereinafter referred to as "the
Licensee") a licence, for the period specified in paragraph 2, subject
to the Conditions set out in the Schedule 1 and to revocation as
provided for in paragraph 2 and in Schedule 2, to run
telecommunication systems of every description within the United
Kingdom ("the Applicable Systems") and authorises the Licensee to do
all or any of the acts specified in Schedule 3.

Duration

2            This Licence shall enter into force on the date of signature
and shall be of six months' duration in the first instance but,
without prejudice to Schedule 2 to this Licence, shall be subject to
revocation thereafter on one month's notice in writing of such
revocation.

Interpretation

3            The Interpretation Act 1978 shall apply for the purpose of
interpreting this Licence as if it were an Act of Parliament.  In this
Licence, except as hereinafter provided or unless the context
otherwise requires, words or expressions shall have the meaning
assigned to them and otherwise any word or expression shall have the
same meaning as it has in the Act.  For the purposes of interpreting
this Licence, headings and titles shall be disregarded.

4            In this Licence, "Licence" means a licence granted or having
effect as if granted under section 7 of the Act.

5            For the purposes of this Licence the "Applicable Systems"
means any or all of
the telecommunication systems run by the Licensee under this Licence
unless the context otherwise requires.

6            Where this Licence provides for any power of the Secretary
of State or the Director to give any direction or consent or make any
specification, designation or determination, it implies, unless the
contrary intention appears, a power, exerciseable in the same manner
and subject to the same conditions or limitations, to revoke, amend or
give or make again any such direction, consent, specification,
designation or determination.

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7            Any notification which is required to be given under this
Licence by the Secretary of State or the Director shall be satisfied
by serving the document by post on the Licensee at the Licensee's
registered office.



                                        /s/  Illegible                        
                                        Parliamentary Under Secretary of State
                                                    for Science and Technology
                                                              18 December 1996


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SCHEDULE 1:  CONDITIONS INCLUDED UNDER SECTION 7 OF THE ACT


PART 1:      DEFINITIONS AND INTERPRETATION RELATING TO THE CONDITIONS IN
             SCHEDULE 1

1            In this Schedule unless the context otherwise requires:

             (a)  "Accounting Rate Service" means each telecommunications
                  service to each country and territory for which a
                  separate accounting rate has been agreed, not including
                  Transit Services;

             (b)  "Applicable Terminal Equipment" means apparatus which
                  is applicable terminal equipment within the meaning of
                  regulation 4 of the Telecommunications Terminal
                  Equipment Regulations 1992;

             (c)  "Approved Apparatus" means in relation to any system
                  apparatus approved under section 22 of the Act for
                  connection to that system;

             (d)  "Associated Person" means any member of the Licensee's
                  Group or a person with a Participating Interest in a
                  member of the Licensee's Group or in whom a member of
                  the Licensee's Group has a Participating Interest;

             (e)  "Authorised Overseas System" means any
                  telecommunication system outside the United Kingdom
                  which is authorised to be connected to the Applicable
                  Systems under Schedule 3;

             (f)  "Compatibility" means that between the parties
                  concerned there is no reasonably foreseeable risk of:

                  (i)  duplication of any Number; or

                  (ii) any other related effect,

                  such as would introduce ambiguity or errors or impose
                  undue restrictions on any user or group of users;

             (g)  "Compliant Terminal Equipment" means Applicable
                  Terminal Equipment which satisfies the requirements of
                  regulation 8 of the Telecommunications Terminal
                  Equipment Regulations 1992;

             (h)  "Condition" means a Condition in this Schedule;

             (i)  "Connectable System" means a telecommunication system
                  which is authorised to be run under a Licence which
                  authorises connection of that system to the Applicable
                  Systems;

             (j)  "Connection Service" means a telecommunication service
                  consisting in the conveyance of any Message which has
                  been, or is to be, conveyed by means of the Applicable
                  Systems;

             (k)  "Dwelling-House" has the same meaning as in section 202
                  of the Broadcasting Act 1990;

             (l)  "Emergency" means an emergency of any kind, including
                  any circumstance whatever resulting from major
                  accidents, natural disasters and incidents involving
                  toxic or radio-active materials;

             (m)  "Emergency Organisations" means in respect of any
                  locality:

                  (i)  the relevant public police, fire, ambulance and
                       coastguard services for that locality; and

                  (ii) any other similar organisation in respect of which
                       any public telecommunications operator licensed to
                       operate in the locality in question is providing a
                       Public Emergency Call Service on the day on which
                       this Licence enters into force;

             (n)  "Essential Interface" means in respect of a Point of
                  Connection an interface at which in the opinion of the
                  Director it is essential that interoperability between
                  the Applicable Systems and the respective Operator's
                  systems is available;

             (o)  "Group" means a parent undertaking and its subsidiary
                  undertaking or undertakings within the meaning of
                  section 258 of the Companies Act 1985 as substituted by
                  section 21 of the Companies Act 1989; and "Licensee's
                  Group" means a Group in respect of which the Licensee
                  is either a parent undertaking or a subsidiary
                  undertaking;

             (p)  "International Business" means the business of
                  providing telecommunication services including, without
                  limitation, any services comprised in a Relevant
                  International Function, which consist in the conveyance
                  of Messages to countries or territories outside the
                  United Kingdom carried on under a Licence and include
                  the running of such parts of the Applicable Systems as
                  are used for the provision of those services, and the
                  installation, maintenance, adjustment, repair,
                  alteration, moving, removal or replacement of such
                  Systems and any apparatus comprised therein;

             (q)  "International Conveyance Service" means a
                  telecommunication service consisting in the conveyance
                  of any Message which has been or is to be conveyed by
                  means of any telecommunication system outside the
                  United Kingdom the connection of which to the system by
                  means of which that service is provided is authorised
                  by a Licence;

             (r)  "International Private Leased Circuit" means a
                  communication facility which is:

               (i)     comprised both in a public telecommunication
                       system and in an equivalent telecommunication
                       system in a country or territory other than the
                       United Kingdom;

               (ii)    for the conveyance of Messages between points,
                       all of which are points of connection between
                       telecommunication systems referred to in
                       paragraph 1(r)(i) and other telecommunication
                       systems;

               (iii)   made available to a particular person or
                       particular persons;

               (iv)    such that all of the Messages transmitted at
                       any of the points mentioned in
                       paragraph 1(r)(ii) are received at every other
                       such point; and

               (v)     such that the points mentioned in
                       paragraph 1(r)(ii) are fixed by the way in
                       which the facility is installed and cannot
                       otherwise be selected by persons or
                       telecommunication apparatus sending Messages by
                       means of that facility;

          (s)  "International Simple Data Resale Services" means
               telecommunication services consisting in the conveyance
               of Messages which do not include two-way live speech,
               but include only such switching, processing, data
               storage or protocol conversion as is necessary for the
               conveyance of those Messages in real time, which have
               been or are to be conveyed by means of all of the
               following:

               (i)     a Public Switched Network;

               (ii)    an International Private Leased Circuit; and

               (iii)   the equivalent of a Public Switched Network in
                       another country or territory;

               provided that conveyance of a Message by means of a
               Public Switched Network or, as the case may be, the
               equivalent of a Public Switched Network in another
               country or territory shall be disregarded where that
               Message is so conveyed in circumstances specified for
               the time being by the Secretary of State as not being
               material for the purposes of paragraph 3 of Schedule 3
               to this Licence and included in a list kept for the
               purpose by the Director and made available by him for
               inspection by the general public;

          (t)  "International Simple Voice Resale Services" means
               telecommunication services consisting in the conveyance
               of Messages which include two-way live speech which
               have been or are to be conveyed by means of all of the
               following:

               (i)     a Public Switched Network;

               (ii)    an International Private Leased Circuit; and

               (iii)   the equivalent of a Public Switched Network in
                       another country or territory;

               provided that conveyance of a Message by means of a
               Public Switched Network or, as the case may be, the
               equivalent of a Public Switched Network in another
               country or territory shall be disregarded where that
               Message is so conveyed in circumstances specified for
               the time being by the Secretary of State as not being
               material for the purposes of paragraph 3 of Schedule 3
               to this Licence and included in a list kept for the
               purpose by the Director and made available by him for
               inspection by the general public;

          (u)  "Long Line Public Telecommunications Operator" means a
               public telecommunications operator who is authorised by
               a Licence to provide telecommunication services
               consisting in the conveyance of Messages by fixed links
               run by that operator over distances greater than
               50 linear kilometres;

          (v)  "Major Office" means the Licensee's registered office
               and such other offices as the Director, having
               consulted the Licensee, may direct;

          (w)  "Message" means anything falling within paragraphs (a)
               to (d) of section 4(1) of the Act;

          (x)  "Network Connecting Apparatus" means telecommunication
               apparatus comprised in the Applicable Systems which is
               not Network Termination and Testing Apparatus and is
               connected to another telecommunication system;

          (y)  "Network Termination Point" means any point:

               (i)     within an item of Network Connecting Apparatus
                       at which energy of any of the forms specified
                       in section 4(1) of the Act is conveyed directly
                       to or from apparatus comprised in a
                       telecommunication system other than one in
                       which that Network Connecting Apparatus is
                       comprised; or

               (ii)    within an item of Network Termination and
                       Testing Apparatus at which such energy is
                       conveyed directly to any Relevant Terminal
                       Apparatus;

          (z)  "Network Termination and Testing Apparatus" means an
               item of telecommunication apparatus comprised in the
               Applicable Systems installed in a fixed position on
               Served Premises which enables:

               (i)     Approved Apparatus to be readily connected to,
                       and disconnected from, the Applicable Systems;

               (ii)    the conveyance of Messages between such
                       Apparatus and the Applicable Systems; and

               (iii)   the due functioning of the Applicable Systems
                       to be tested,

               but the only other functions of which, if any, are:

               (1)     to supply energy between such Apparatus and the
                       Applicable Systems;

               (2)     to protect the safety or security of the
                       operation of the Applicable Systems; or

               (3)     to enable other operations exclusively related
                       to the naming of the Applicable Systems to be
                       performed or the due functioning of any system
                       to which the Applicable Systems are or are to
                       be connected to be tested (separately or
                       together with the Applicable Systems).

          (aa) "Number" means any identifier which would need to be
               used in conjunction with any public switched service
               for the purposes of establishing a connection with any
               Network Termination Point, user, telecommunication
               apparatus connected to any Public Switched Network or
               service element, but not including any identifier which
               is not accessible to the generality of users of a
               public switched service;

          (ab) "Numbering Plan" means a plan describing the method
               adopted or to be adopted for allocating and re-
               allocating a Number to any Network Termination Point,
               user telecommunication apparatus or service element;

          (ac) "Operator" means any person who is authorised by a
               Licence to run a Relevant Connectable System;

          (ad) "Parent Undertaking" has the same meaning as in
               section 258 of the Companies Act 1985 as substituted by
               section 21 of the Companies Act 1989;

          (ae) "Participating Interest" has the same meaning as in
               section 260 of the Companies Act 1985 as substituted by
               section 22 of the Companies Act 1989;

          (af) "Point of Connection" means a point at which the
               Applicable Systems and an Operator's system are
               connected;

          (ag) "Private Leased Circuit" means a communication facility
               which is:

               (i)     provided by means of one or more public
                       telecommunication systems;

               (ii)    for the conveyance of Messages between points,
                       all of which are points of connection between
                       telecommunication systems referred to in
                       paragraph 1(ag)(i) and other telecommunication
                       systems;

               (iii)   made available to a particular person or
                       particular persons;

               (iv)    such that all of the Messages transmitted at
                       any of the points mentioned in
                       paragraph l(ag)(ii) are received at every other
                       such point; and

               (v)     such that the points mentioned in
                       paragraph 1(ag)(ii) are fixed by the way in
                       which the facility is installed and cannot
                       otherwise be selected by persons or
                       telecommunication apparatus sending Messages by
                       means of that facility;

          (ah) "Public Emergency Call Services" means a
               telecommunication service by means of which any member
               of the public may, at any time and without incurring
               any charge, by means of an item of telecommunication
               apparatus which is lawfully connected to the Applicable
               Systems and which is capable of transmitting and
               receiving unrestricted two way voice telephony services
               when so connected, communicate as swiftly as
               practicable with any of the Emergency Organisations for
               the purpose of notifying them of an Emergency; 

          (ai) "Public Switched Network" means a public
               telecommunication system by means of which two-way
               telecommunication services are provided whereby
               Messages are switched incidentally to their conveyance,
               and, for the avoidance of doubt, a Public Switched
               Network does not include Private Leased Circuits or
               International Private Leased Circuits;

          (aj) "Relevant Apparatus" means any apparatus which is, or
               is to be, connected to any of the switched Applicable
               Systems;

          (ak) "Relevant Company" means:

               (i)     the Licensee; or

               (ii)    a Parent Undertaking in relation to the
                       Licensee;

          (al) "Relevant Connectable System" means a Connectable
               System which is authorised to be run under a Licence
               which authorises the provision by means of that system
               of Connection Services for reward to the general
               public, or any class of the general public, not being a
               system:

               (i)     authorised to be run under a Licence granted to
                       all persons or persons of any class; and

               (ii)    for the connection of which, and for the
                       provision of matters necessary for such
                       connection, the Licensee offers terms and
                       conditions which satisfy the requirements of
                       Condition 7 of Schedule 1,

               and not being a system which the Director has
               determined ought not to be deemed a Relevant
               Connectable System for the purposes of this Licence;

          (am) "Relevant International Function" means the business of
               providing any of the following telecommunication
               services by means of the Applicable Systems:

               (i)     International Simple Voice Resale and/or
                       International Simple Data Resale;

               (ii)    provision to others of International Private
                       Leased Circuits;

               (iii)   provision of services under any agreement
                       falling within the description contained in
                       Condition 5.1 in Schedule 1;

               (iv)    provision of International Conveyance Services
                       (but not including International Simple Voice
                       Resale or International Simple Data Resale),
                       charges for which are to be settled at
                       accounting rates;

               (v)     provision of International Conveyance Services
                       (but not including International Simple Voice
                       Resale or International Simple Data Resale),
                       charges for which are not to be settled at
                       accounting rates, and where the Messages
                       conveyed in the provision of such service are
                       conveyed over a circuit which is capable of
                       conveying two-way live speech;

               (vi)    provision of International Conveyance Services
                       (including International Simple Voice Resale or
                       International Simple Date Resale), charges for
                       which are not to be settled at accounting
                       rates, and where the Messages conveyed in the
                       provision of such service are conveyed over a
                       circuit which is not capable of conveying two-
                       way live speech;

               (vii)   the installation, maintenance, adjustment,
                       repair, alteration, moving, removal or
                       replacement of any apparatus comprised or to be
                       comprised in the Applicable Systems; or

               (viii)  provision of any other services included in the
                       Licensee's International Business but not
                       included in any of (am) (i) to (vii) above.

          (an) "Relevant System" means a Connectable System which is,
               or is to be, connected to any of the switched
               Applicable Systems;

          (ao) "Relevant Terminal Apparatus" means:

               (i)     "Terminal Apparatus", that is to say any
                       telecommunication apparatus installed on Served
                       Premises by means of which Messages are
                       initially transmitted or ultimately received;
                       and

               (ii)    any other telecommunication apparatus directly
                       connected to Terminal Apparatus (including
                       apparatus which is Terminal Apparatus by virtue
                       of this sub-paragraph) which would, if it were
                       run with such Terminal Apparatus and any other
                       apparatus by means of which it is so connected,
                       constitute a system authorised to be run by the
                       person running that Terminal Apparatus under a
                       Licence;

          (ap) "Served Premises" means a single set of premises in
               single occupation where apparatus has been installed
               for the purpose of the provision of telecommunication
               services by means of the Applicable Systems at those
               premises;

          (aq) "Shares" has the same meaning as in section 259(2) of
               the Companies Act 1985, as substituted by section 22 of
               the Companies Act 1989, and the term "Shareholding" is
               to be construed accordingly;

          (ar) "Specified Numbering Scheme" means a scheme for the
               allocation and reallocation of Numbers which is
               specified by the Director for the purpose of this
               Licence and described in a list kept for that purpose
               by him and made available by him for inspection by the
               general public.

          (as) "Subscriber" means a person (other than a public
               telecommunications operator) to whom there are provided
               switched voice telephony services by means of the
               Applicable Systems;

          (at) "Subsidiary" has the meaning given to it in section 736
               of the Companies Act 1985, as substituted by
               section 144(1) of the Companies Act 1989;

          (au) "Systems Business" means the following activities of
               the Licensee or of any wholly owned Subsidiary to the
               extent that they are undertaken in the United Kingdom
               taken together:

               (i)     the running of the Applicable Systems; and

               (ii)    the installation, maintenance, adjustment,
                       repair, alteration, moving, removal or
                       replacement of any apparatus comprised or to be
                       comprised in the Applicable Systems;

          (av) "Transit Service" means any telecommunications service
               consisting in the conveyance of any Message which
               originates outside the United Kingdom and is not to be
               terminated within the United Kingdom and for which a
               separate accounting rate has been agreed;

          (aw) "Well Established International Operator" means an
               Operator having 25% or more of what is in the opinion
               of the Director the relevant market, unless the
               Director determines that the Operator is not a Well
               Established International Operator, or an Operator
               having less than 25% of what is in the opinion of the
               Director the relevant market which is determined by the
               Director to be a Well Established International
               Operator.

2         Any reference in any Condition in this Schedule, however
expressed, to the Director notifying the Licensee about any matter,
affording the Licensee an opportunity to make representations, taking
representations by the Licensee into account, or explaining, or giving
reasons for, any matter to the Licensee, shall be without prejudice to
any obligation of due process or similar obligation which the Director
is or may be under by virtue of any rule or principle of law or
otherwise.

3         Expressions cognate with those referred to in this Schedule
shall be construed accordingly.


<PAGE>

PART 2:   SPECIAL CONDITIONS REFERRED TO IN SECTION 8 OF THE ACT

                                                                   Condition 1

REQUIREMENTS TO PROVIDE TELECOMMUNICATION SERVICES

1         The Licensee shall take all reasonable steps to provide by
means of the Applicable Systems to any Operator who so requests
International Conveyance Services to
the extent necessary to satisfy all reasonable demands for such
Services by such Operator.


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                                                                   Condition 2

DIRECTORY INFORMATION

2.1       This Condition shall only apply where the Applicable Systems
are connected to a telecommunication system not run under a Licence
issued to a particular person.

2.2       Subject to paragraph 2.5, where the Licensee provides
switched voice telephony services by means of any of the Applicable
Systems which is connected to an Authorised Overseas System by means
of which such services are provided, then, if a directory information
service is provided by means of that Authorised Overseas System in
respect of that Authorised Overseas System, the Licensee shall provide
to any person to whom it provides switched voice telephony services by
means of that Applicable System information as to how that person may
avail himself by means of that Applicable System and that Authorised
Overseas System when connected together of the directory information
service provided and shall take all reasonable steps to secure that
that can be done.

2.3       Where the Licensee provides switched voice telephony
services by means of any of the Applicable Systems which is connected
to both:

          (a)  an Authorised Overseas System by means of which such
               services are provided; and

          (b)  a Connectable System in the United Kingdom by means of
               which such services are provided which is run under a
               Licence which does not authorise the connection of that
               system to a system outside the United Kingdom so as to
               convey Messages from the United Kingdom to a place
               outside the United Kingdom

it shall not unreasonably refuse to provide to the operator of that
Connectable System access to such directory information services
relating to the Authorised Overseas System as the Licensee makes
available to those to whom it provides voice telephony services.

2.4       The directory information service provided by the Licensee
under paragraph 2.2 shall include a service satisfactory to the
Director whereby directory information is made available in a form
which is appropriate to meet their needs to persons who are so blind
or otherwise disabled as to be unable to use a telephone directory in
a form in which it is generally available to persons to whom the
Licensee provides services; and the service so provided to such
persons shall from the date on which this Licence enters into force be
provided free of charge or, if the Director is satisfied that that is
not practicable, the Licensee shall provide, in accordance with
arrangements agreed with the Director, appropriate reasonable
compensation in respect of charges that are paid.

2.5       The obligation in paragraph 2.2 shall not apply:

          (a)  when the directory information requested relates to a
               person who has requested the Licensee or the operator
               of the connected telecommunication system not to
               provide such information in relation to him; or

          (b)  in respect of any person to whom switched voice
               telephony services are provided by means of the
               Applicable Systems if that person has notified the
               Licensee in writing that he is able to obtain from
               another public telecommunications operator who provides
               switched voice telephony services within the United
               Kingdom to that person information as to how to avail
               himself of such directory information service as may be
               provided in respect of any Authorised Overseas System
               which is connected to the Applicable Systems.

2.6       This Condition is without prejudice to Condition 5.


<PAGE>

                                                                   Condition 3

PUBLIC EMERGENCY CALL SERVICES

3.1       This Condition shall only apply where the Applicable Systems
are connected to a telecommunication system not run under a Licence
issued to a particular person.

3.2       The Licensee shall ensure, except to the extent that the
Director determines is not reasonably practicable, that both the
numbers 999 and 112 are available as emergency call numbers so that
any member of the public by dialling either the number 999 or the
number 112 on telecommunication apparatus which is lawfully connected
to the Applicable Systems at any place in the United Kingdom and which
is capable of transmitting and receiving unrestricted two way voice
telephony services when so connected is provided with a Public
Emergency Call Service.

3.3       Where the Director has made a determination in accordance
with paragraph 3.2 the Licensee shall take all reasonable steps to
ensure that persons to whom there are provided by means of the
Applicable Systems services which do not include a Public Emergency
Call Service are notified in writing that the services so provided do
not include a Public Emergency Call Service.

3.4       For the purposes of this Condition telecommunication
apparatus shall be regarded as capable of transmitting and receiving
unrestricted two way voice telephony services only if it is capable of
both:

          (a)  transmitting for conveyance by means of an Applicable
               System specific signals designated by the Licensee for
               the purpose of establishing communication with voice
               telephony apparatus controlled by the Emergency
               Organisations; and

          (b)  transmitting and receiving uninterrupted simultaneous
               two way speech to be conveyed, or as the case may be
               conveyed, by means of that Applicable System.

3.5       In this Condition, the United Kingdom does not include any
area to which the Act is extended under section 107.


<PAGE>

                                                                   Condition 4

PLANNING AND IMPLEMENTATION OF SPECIAL ARRANGEMENTS FOR EMERGENCIES

4.1       The Licensee shall, after consultation with such authorities
responsible for Emergency Organisations and such departments of
central and local government as the Director may from time to time
determine and whose names are notified to the Licensee by him for the
purpose, make plans or other arrangements for the provision or, as the
case may be, the rapid restoration of such telecommunication services
as are practicable and may reasonably be required in Emergencies.

4.2       The Licensee shall, on request by any such person as is
designated for the purpose in the relevant plans or arrangements,
implement those plans or arrangements insofar as it is reasonable and
practicable to do so.

4.3       Nothing in this Condition precludes the Licensee from:

          (a)  recovering the costs which it incurs in making or
               implementing any such plans or arrangements from those
               on behalf of or in consultation with whom the plans or
               arrangements are made; or

          (b)  making implementation of any plans or arrangements
               conditional upon the person or persons for whom or on
               whose behalf that plan or arrangement is to be
               implemented indemnifying the Licensee for all costs
               incurred as a consequence of the implementation.


<PAGE>

                                                                   Condition 5

REQUIREMENT TO PROVIDE CONNECTION SERVICES AND CONNECTION OF APPARATUS

5.1       Subject to the following provisions of this Condition the
Licensee shall, unless it is impracticable to do so, enter into an
agreement or agree to amend such an agreement, within a reasonable
period (which shall not, unless the Director otherwise consents,
exceed 6 months), with an Operator if that Operator requires it to do
so:

          (a)  to connect, and keep connected, to any of the
               Applicable Systems, or to permit to be so connected and
               kept connected, any Relevant Connectable System run by
               the Operator and any item of telecommunication
               apparatus which is required for that purpose and which
               is located on the same premises as the Applicable
               Systems and which is approved for the time being under
               section 22 of the Act or is Compliant Terminal
               Equipment, and accordingly to establish and maintain
               such one or more Points of Connection as are reasonably
               required and are of sufficient capacity and in
               sufficient number to enable Messages conveyed or to be
               conveyed by means of the Operator's system to be
               conveyed by means of the Applicable Systems in such a
               way as conveniently to meet all reasonable demands for
               the conveyance of Messages between the Relevant
               Connectable System and the Applicable Systems;

          (b)  without prejudice to paragraph 5.1(a), where the
               Operator is a Long Line Public Telecommunications
               Operator, to establish and maintain such Points of
               Connection as will enable persons running
               telecommunication systems connected to the Operator's
               system and persons running telecommunication systems
               connected to the Applicable Systems to exercise freedom
               of choice as to the extent to which Messages are
               conveyed by means of the Applicable Systems and in
               routing Messages so conveyed; and

          (c)  to provide such other telecommunication services
               (including the conveyance of Messages which have been,
               or are to be, transmitted or received at such Points of
               Connection), information and other services as the
               Director determines are reasonably required (but no
               more than reasonably required) to secure that Points of
               Connection are established and maintained and to enable
               the Operator effectively to provide the Connection
               Services which he provides or proposes to provide.

5.2       The Licensee shall not be obliged under paragraph 5.1 to
enter into an agreement to do anything or agree to amend such an
agreement to do anything if:

          (a)  in the opinion of the Licensee it would be liable to
               cause the death of or personal injury to, or damage to
               the property of, the Licensee or any person engaged in
               the Licensee's business, or materially to impair the
               quality of any telecommunication service provided by
               means of the Applicable Systems or any
               telecommunication system (other than the Operator's
               system) connected thereto and the Director has not
               expressed a contrary opinion; or

          (b)  in the opinion of the Licensee:

               (i)     it would require an adjustment to, or
                       modification of, the Applicable Systems whether
                       by incorporation of apparatus or otherwise or
                       the provision by the Licensee of services or
                       information which in any particular case would
                       not be reasonably required; or

               (ii)    it would not be reasonably practicable to
                       require the Licensee to do that thing, or
                       permit it to be done, at the time or in the
                       manner required by the Operator, having regard
                       to the state of technical development of the
                       Applicable Systems or any other relevant
                       matter,

               and the Director has not expressed a contrary opinion.

5.3       The Licensee may require that an agreement under
paragraph 5.1 should be subject to such terms and conditions as are,
in the opinion of the Director, reasonable.

5.4       Apparatus shall not be regarded as approved for connection
to any system for the purposes of paragraph 5.1 unless that apparatus
is Compliant Terminal Equipment or has been so approved:

          (a)  by the Secretary of State; or

          (b)  by some other person by virtue of an authorisation
               given by the Secretary of State being an authorisation
               which required the person authorised, before approving
               any apparatus or designating any standard to which
               apparatus must conform if it is to be approved, to be
               satisfied that connection of the apparatus to the
               system would not be likely:

               (i)     to cause the death of, or personal injury to,
                       or damage to the property of the Licensee or
                       any person engaged in the running of that
                       system; or

               (ii)    materially to impair the quality of any
                       telecommunication service provided by means of
                       that system or any system connected to it
                       (other than the system being connected).

5.5       No apparatus or system is required under paragraph 5.1 to
be, or to be permitted to be, connected or kept connected to the
Applicable Systems if the apparatus, or any apparatus comprised in
that system, as the case may be:

          (a)  conformed to the relevant standard or standards at the
               time when the connection to the Applicable Systems was
               made but no longer does so and does not conform to the
               relevant standard or standards (if any) for the time
               being designated under section 22(6) of the Act; or

          (b)  was at the time when the connection to the Applicable
               Systems was made but has since ceased to be Complaint
               Terminal Equipment; or

          (c)  while continuing to conform to the relevant standard is
               in the opinion of the Licensee liable to cause the
               death of, or personal injury to, or damage to the
               property of, the Licensee, or any person engaged in the
               running of the Applicable Systems or materially to
               impair the quality of any telecommunication service
               provided by means of the Applicable Systems and the
               Director has not directed otherwise.

5.6       An agreement made pursuant to this Condition shall not
contain any restrictive provision unless, before the agreement is
made, the Director has expressly consented to the inclusion of such a
provision.  For the purposes of this paragraph, a provision in an
agreement is a restrictive provision if by virtue of the existence of
such a provision (taken alone or with other provisions) the agreement
is one to which the Restrictive Trade Practices Act 1976 would apply
but for paragraph 1(l) of Schedule 3 to that Act.

5.7       Where the Director so directs the Crown shall be treated for
the purposes of this Condition as a person authorised to run a
Relevant Connectable System and where he does so he may also direct
that the Crown is to be treated as a Long Line Public
Telecommunications Operator for those purposes.


<PAGE>

                                                                   Condition 6

PROVISION BY OTHERS OF SERVICES BY MEANS OF THE APPLICABLE SYSTEMS

6.1       The Licensee shall permit any person, who is licensed to run
a Connectable System under a Licence which authorises it to provide
telecommunication services to others, including Connection Services,
to provide such services whilst that Connectable System is connected
to the relevant Applicable System.

6.2       The Licensee shall permit any person:

          (a)  using telecommunication apparatus which has been
               lawfully connected to the Applicable Systems or which
               is connected to another telecommunication system which
               itself has been lawfully connected to the Applicable
               Systems; or

          (b)  running a telecommunication system which is so
               connected,

to provide by means of the Applicable Systems any service other than
the installation, maintenance, adjustment, repair, alteration, moving,
removal or replacement of telecommunication apparatus comprised in the
Applicable Systems.


<PAGE>

                                                                   Condition 7

PUBLICATION OF CHARGES, TERMS AND CONDITIONS TO BE APPLIED

7.1       The Licensee shall, subject to paragraph 7.2, except insofar
as the Director may otherwise consent in writing and except in respect
of charges, terms and conditions in agreements made or modified to
comply with Condition 5:

          (a)  publish in the manner and at the times specified in
               paragraph 7.4 a notice specifying, or specifying the
               method that is to be adopted for determining, the
               charges and other terms and conditions on which it
               offers:

               (i)     to provide each description of
                       telecommunication services by means of the
                       Applicable Systems; or

               (ii)    to maintain, adjust, repair or replace any
                       apparatus comprised in the Applicable Systems;
                       or

               (iii)   to connect to the Applicable Systems any other
                       system which is not and is not to be comprised
                       in the Applicable Systems; or

               (iv)    to grant permission to connect such systems to,
                       or to provide services by means of, the
                       Applicable Systems;

          where such things are done in accordance with an obligation
          imposed by or under this Licence.

          (b)  Where the Licensee does any of the things described in
               paragraphs 7.1(a)(i) to 7.1(a)(iv) it shall do those
               things at the charges and on the other terms and
               conditions so published and not depart therefrom. 
               Provided that this obligation will not be breached by
               variations to the charges, terms and conditions
               referred to in paragraph 7(1)(a) to the extent that the
               method which is adopted for determining those
               variations has been disclosed to the Director, except
               insofar as those charges, terms and conditions relate
               to a particular market in respect of which the Director
               has made a determination that the Licensee is a Well
               Established International Operator.

7.2       Where the Director has made a determination that the
Licensee is a Well Established International Operator in a particular
market the Licensee shall specify the precise amount of such charges
in accordance with paragraph 7.1(a), insofar as they relate to the
market in respect of which such a determination has been made.

7.3       The requirement to publish under paragraph 7.1 shall not
apply in respect of any service which is materially different from any
service already provided by the Licensee by means of the Applicable
Systems until such time as it is provided and a copy of the notice
shall be sent to the Director at that time.

7.4       Publication of the notice shall be effected by:

          (a)  sending a copy thereof to the Director to arrive not
               more than 28 days after the date on which the Licensee
               first provides services under the Licence and
               thereafter not less than one day before any proposal to
               amend any charge, term or condition or the method of
               determining the same is to become effective:  provided
               that where the Director has made a determination that
               the Licensee is a Well Established International
               Operator in a particular market, this sub-paragraph
               shall have effect as if the words "28 days" were
               substituted for the words "one day" insofar as any such
               proposal relates to the provision of services in
               relation to the market in respect of which such a
               determination has been made;

          (b)  placing as soon as practicable thereafter a copy
               thereof in a publicly accessible part of every Major
               Office of the Licensee in such a manner and in such a
               place that it is readily available for inspection free
               of charge by members of the general public during such
               hours as the Secretary of State may by order prescribe
               under section 19(4) of the Act that the register of
               Licences and final and provisional orders is to be open
               to public inspection, or in the absence of any such
               order having been made by the Secretary of State,
               during normal office hours; and

          (c)  sending a copy thereof or such part or parts thereof as
               are appropriate to any person who may request such a
               copy.

7.5       The obligations imposed on the Licensee by this Condition
are without prejudice to any determination which the Director may make
under Condition 9 of this Licence.


<PAGE>

                                                                   Condition 8

PROHIBITION ON UNDUE PREFERENCE AND UNDUE DISCRIMINATION

8.1       The Licensee shall not (whether in respect of the charges or
other terms or conditions applied or otherwise) show undue preference
to, or exercise undue discrimination
against, particular persons or persons of any class or description as
respects:

          (a)  the connection to the Applicable Systems of any other
               system which is not and is not to be comprised in the
               Applicable Systems in accordance with an obligation
               imposed by or under this Licence; or

          (b)  the maintenance, adjustment, repair or replacement of
               any apparatus comprised in the Applicable Systems in
               accordance with an obligation imposed by or under this
               Licence; or

          (c)  the provision by means of the Applicable Systems of any
               telecommunication service in accordance with an
               obligation imposed by or under this Licence; or

          (d)  the granting of permission to connect such systems to,
               or to provide services by means of the Applicable
               Systems in accordance with an obligation imposed by or
               under this Licence.

8.2       The Licensee may be deemed to have shown such undue
preference or to have exercised such undue discrimination if it
unfairly favours to a material extent a business carried on by it in
relation to the doing of any of the things mentioned in paragraph 8.1
so as to place at a significant competitive disadvantage persons
competing with that business.

8.3       Any question relating to whether any act done or course of
conduct pursued by the Licensee amounts to such undue preference or
such undue discrimination shall be determined by the Director, but
nothing done in any manner by the Licensee shall be regarded as undue
preference or undue discrimination if and to the extent that the
Licensee is required or permitted to do the thing in that manner by or
under any provision of this Licence.

8.4       The obligations imposed on the Licensee by this Condition
are without prejudice to any determination which the Director may make
under Condition 9 of this Licence.


<PAGE>

PART 3:   OTHER CONDITIONS INCLUDED UNDER SECTION 7 OF THE ACT

                                                                   Condition 9

MAINTENANCE OF EFFECTIVE COMPETITION WHERE THE LICENSEE OPERATES A
SYSTEM OR PROVIDES SERVICE OVERSEAS

9.1       This Condition shall apply where the Licensee or any
Associated Person is the operator of any telecommunication system or
provides telecommunication services in a country or territory outside
the United Kingdom

9.2       Where it appears to the Director that as a result of any act
or omission of the Licensee either by itself or with or through any
Associated Person competition in the provision of any
telecommunication service or any particular description of
telecommunication services in the United Kingdom is being or is likely
to be restricted, distorted or prevented he may make a determination
to that effect.

9.3       Where the Director makes a determination under paragraph 9.2
the Licensee shall take such steps as the Director may direct for the
purpose of remedying the situation.  In particular (and without
prejudice to the generality of the foregoing) any such direction may
require compliance by the Licensee with any other Condition, as
appropriate, including in particular any Condition providing for
publication of charges, terms and conditions or prohibiting undue
discrimination and undue preference, in relation to the provision of
any telecommunication service within the United Kingdom
notwithstanding that any condition precedent to the application of
that Condition is not otherwise satisfied.


<PAGE>

                                                                  Condition 10

FAIR TRADING

10.1      The Licensee shall not do any thing, whether by act or
omission, which has or is intended to have or is likely to have the
effect of preventing, restricting or distorting competition where such
act or omission is done in the course of, as a result of or in
connection with, providing telecommunication services, or any
particular description of telecommunication service, or running a
telecommunication system.

For the purpose of this Condition such an act or omission will take
the form of:-

          (a)  any abuse by the Licensee, either alone or with other
               undertakings, of a dominant position within the United
               Kingdom or a substantial part of it.  Such abuse may,
               in particular, consist in:

               (i)     directly or indirectly imposing unfair purchase
                       or selling prices or other unfair trading
                       conditions;

               (ii)    limiting production, markets or technical
                       development to the prejudice of consumers;

               (iii)   applying dissimilar conditions to equivalent
                       transactions with other parties, thereby
                       placing them at a competitive disadvantage; or

               (iv)    making the conclusion of contracts subject to
                       acceptance by the other parties of
                       supplementary obligations which, by their
                       nature or according to commercial usage, have
                       no connection with the subject of such
                       contracts; or

          (b)  the making (including the implementation) of any
               agreement, the compliance with any decision of any
               association of undertakings or the carrying on of any
               concerted practice with any other undertaking which has
               the object or effect of preventing, restricting or
               distorting competition within the United Kingdom.

10.2      (a)  An act or omission of a kind described in
               paragraph 10.1 is not prohibited where:

               (i)     it has or would have no appreciable effect on
                       competition; or

               (ii)    it has or would have no effect on competition
                       between persons engaged in commercial
                       activities connected with telecommunications
                       and it would have no effect on users of
                       telecommunication services.

          (b)  An act or omission of a kind described in
               paragraph 10.1(b) is not prohibited by this Condition
               if the agreement decision or concerted practice
               contributes to improving the provision of any goods or
               services or to promoting technical or economic
               progress, while allowing consumers a fair share of the
               resulting benefit and does not:

               (i)     impose on the parties concerned restrictions
                       which are not indispensable to attaining those
                       objectives; and

               (ii)    afford such parties the possibility of
                       eliminating competition in respect of a
                       substantial part of the goods or services in
                       question.

          (c)  This Condition shall not apply to any provision of an
               agreement insofar as it is a provision by virtue of
               which the Restrictive Trade Practices Act 1976 applies
               to that agreement.

          (d)  This Condition shall not apply to a merger situation
               qualifying for investigation under the Fair Trading Act
               1973.

10.3      Whether any act or omission is prohibited by this Condition
shall be determined:

          (a)  with a view to securing that there is no inconsistency
               with the general principles having application to
               similar questions of directly applicable competition
               law, in particular those laid down by the Court of
               Justice of the European Communities on the scope of the
               competition rules contained in the EC Treaty and block
               exemptions adopted by the European Commission under
               Article 85(3); and

          (b)  having regard to -

               (i)     any decision taken, or notice issued, by the
                       European Commission in applying the competition
                       rules contained in the EC Treaty and any
                       relevant pronouncement of the Director General
                       of Fair Trading or report of the Monopolies and
                       Mergers Commission; and

               (ii)    any guidelines on the application of this
                       Condition issued from time to time by the
                       Director.

10.4      (a)  If it appears to the Director that an act or omission
               of the Licensee is or was prohibited by this Condition
               he may make an initial determination to that effect (an
               "Initial Determination").

          (b)  Before making an Initial Determination the Director
               shall give a notice to the Licensee:

               (i)     stating that he is investigating a possible
                       contravention of this Condition;

               (ii)    setting out the reasons why it appears to him
                       that this Condition may be being, or may have
                       been, breached, including any matters of fact
                       or law which he thinks relevant;

               (iii)   requesting within a reasonable period laid down
                       by the Director such further information as he
                       may require from the Licensee in order to
                       complete his Determination; and

               (iv)    where appropriate, setting out the steps he
                       believes the Licensee would have to take in
                       order to remedy the alleged breach.

10.5      (a)  Within 28 days of the Director -

               (i)     making an Initial Determination;

               (ii)    making a provisional order; or

               (iii)   giving notice of his proposal to make a final
                       order under section 17(1) of the Act

               in respect of the contravention in question, the
               Licensee may notify the Director that it -

               (iv)    requires him to make a final determination (a
                       "Final Determination") of the matter;

               (v)     requires that in making the Final Determination
                       he take into account a report of a body of
                       experts appointed by him to consider the matter
                       ("the Advisory Body").

          (b)  Before making a Final Determination the Director shall -

               (i)     give a notice to the Licensee setting out the
                       matters referred to in paragraph 10.4(b); and

               (ii)    if the Licensee has given notice under sub-
                       paragraph (a)(v) above, take into account the
                       report of the Advisory Body on the matter.

          (c)  The Director shall then determine whether he is
               satisfied that the act or omission in respect of which
               the Initial Determination was made is or was prohibited
               by this Condition.

10.6      (a)  Before making his Initial Determination or Final
               Determination the Director shall give the Licensee, and
               any other person whom he considers it appropriate to
               consult, such period within which to make
               representations (both orally and in writing) in
               response to the notice as he considers reasonable in
               all the circumstances.

          (b)  The Director shall notify the Licensee and any other
               person whom he considers it appropriate to notify of
               every Initial Determination and Final Determination
               made by him and of his reasons for making it; and he
               shall, if so requested by the Licensee, publish any
               report of the Advisory Body on the matter, subject to
               such exclusions as he may consider it appropriate to
               make of matters of a kind mentioned in section 48(2) of
               the Act.

10.7      The Director shall publish a description of his office's
procedures for the enforcement of this Condition including the steps
taken to ensure that he has access to appropriate independent advice
in enforcing this Condition.

10.8      This Condition shall not limit or affect in any way the
Licensee's obligations arising under any other Condition of this
Licence nor limit the Director's powers of enforcement under
sections 16 to 18 of the Act.

10.9      (a)  On the coming into force of any Act or subordinate
               legislation which -

               (i)     contains a prohibition enforceable by the
                       Director, or gives to the Director the power to
                       enforce an existing prohibition, of any
                       behaviour prohibited under paragraph 10.1;

               (ii)    gives to third parties in respect of a breach
                       of that prohibition at least the rights they
                       have under section 18 of the Act in respect of
                       a breach of a provisional or final order; and

               (iii)   permits the imposition on the Licensee of
                       monetary penalties in respect of the breach of
                       that prohibition 

               this Condition shall cease to apply to the behaviour
               prohibited by or the prohibition enforceable by such
               Act or subordinate legislation.

          (b)  If this Condition still has effect on 31st July 2001,
               it shall cease to have effect after that date.

10.10     (a)  This Condition shall come into force on 31st December
               1996.

          (b)  The prohibition in paragraph 10.1(b) shall not apply to
               acts or omissions done prior to the expiry of three
               months from the date of this Licence in pursuance of
               agreements entered into prior to the date of this
               Licence.


<PAGE>

                                                                  Condition 11

ESSENTIAL INTERFACES

11.1      This Condition operates without prejudice to the provisions
of Condition 5.

11.2      The Director may, having first notified the Licensee of his
proposal and given the Licensee not less than 28 days in which to make
representations, specify an Essential Interface.

11.3      Where in pursuance of paragraph 11.2 the Director specifies
an interface as an Essential Interface, and the Licensee thereafter
makes that interface available to an Operator in relation to its
Applicable Systems, it shall do so in such a manner as it considers
appropriate, but shall ensure such availability in compliance with a
Relevant Standard if the Operator so requires.

11.4      For the purposes of paragraph 11.3 "Relevant Standard"
means:

          (a)  an appropriate European or other international
               standard; or

          (b)  in the absence of such a standard, any other standard
               specified by the Director after he has notified the
               Licensee of his proposal to make the specifications in
               question and allowed the Licensee not less than 28 days
               in which to make representations, provided that the
               Director shall not specify a standard if an appropriate
               European or other international standard is expected to
               be promulgated within a reasonable time, including, by
               way of example, if the European Telecommunications
               Standards Institute have published a work programme for
               the development of such a standard,

to the extent that such a standard is necessary to ensure interoperability.

11.5      Where in pursuance of paragraph 11.4(b) the Director
specifies a standard as a Relevant Standard, he shall include in that
Relevant Standard a technical specification, using all reasonable
endeavours to obtain the agreement of the Licensee and other relevant
licensees to a technical specification applicable to that Relevant
Standard, being a specification defined if possible by reference to:

          (a)  an appropriate European or other international
               specification; or

          (b)  in the absence of such a specification, a specification
               defined by reference to any other standard having
               currency within the European Community at the time.

11.6      Where after a reasonable time the Director has been unable
in accordance with paragraph 11.5 to secure the agreement of the
Licensee and other relevant licensees to a technical specification,
the Director shall adopt for inclusion in the Relevant Standard an
appropriate technical specification which has been promulgated by a
recognised standards body, including, by way of example, the European
Telecommunications Standards Institute, or the British Standards
Institution, or other such body as the Director considers to be
representative of all relevant telecommunications interests.

11.7      The Director shall specify a Relevant Standard in pursuance
of paragraph 11.4 only if the owners of relevant intellectual property
rights have agreed to grant any necessary licences in respect thereof
to the Licensee on reasonable terms.

11.8      For the avoidance of doubt this Condition shall not:

          (a)  without prejudice to paragraph 11.3, prevent the
               Licensee using such interfaces as it considers
               appropriate in relation to the Applicable Systems; or

          (b)  where it makes available to an Operator an interface
               which the Director has specified as an Essential
               Interface, require the Licensee to comply with the
               Relevant Standard if the Operator does not require it
               to do so.

11.9      When implementing an Essential Interface, the Licensee shall
not be obliged to conform with the Relevant Standard:

          (a)  if to do so would necessitate the Licensee:

               (i)     acquiring apparatus, software or other goods or
                       supplies of any kind, or implementing any
                       operation, incompatible with, as the case may
                       be, apparatus, software or such other goods or
                       supplies already in use at the time, or the
                       subject of contracts for their procurement for
                       use, in connection with the Applicable Systems,
                       or, in the case of an operation, incompatible
                       with any other operation being carried out at
                       the time in connection therewith; or

               (ii)    incurring any cost, or having to resolve
                       technical difficulties, disproportionate to the
                       benefits to be gained from the implementation
                       of the Relevant Standard,

               provided that the Licensee shall take reasonable steps
               to incorporate the Relevant Standard in its plans for
               network development, with a view to implementation of
               that Standard in connection with the Applicable
               Systems, but without the Licensee incurring any
               incremental expenditure which, but for the
               implementation of the Relevant Standard, would not have
               been incurred;

          (b)  if the Relevant Standard is inappropriate for the
               particular application for any reason, including,
               without limitation:

               (i)     that it does not afford the Licensee adequate
                       protection for the security of the Applicable
                       Systems;

               (ii)    that its implementation would be liable to
                       cause material impairment in the quality of any
                       telecommunication service provided by means of
                       the Applicable Systems;

               (iii)   that it does not cater adequately for billing,
                       metering or other customer administration
                       systems; or

               (iv)    that it is technically inadequate in the light
                       of technical developments which have taken
                       place since it was originally created;

          (c)  if the Essential Interface concerned is of a genuinely
               innovative nature and accordingly the use in connection
               with it of the Relevant Standard would not be
               appropriate;

          (d)  if compliance with the Relevant Standard would involve
               the infringement by the Licensee of any intellectual
               property right vested in any person; or

          (e)  if the Director so agrees.

11.10     Where paragraph 11.9(b) or 11.9(c) applies, the Licensee
shall notify the Director thereof in writing, providing an explanation
why.

11.11     It is a precondition of any obligation on the Licensee under
this Condition that an equivalent Condition to this Condition is
included in the respective Licences of all Operators running
telecommunication systems that are connected to the Applicable
Systems.


<PAGE>

                                                                  Condition 12

CUSTOMER INTERFACE STANDARDS

12.1      This Condition shall only apply where the Applicable Systems
are connected to a telecommunication system not run under a licence
issued to a particular person.

12.2      The Licensee shall ensure that on each occasion on which it
introduces an interface provided or to be provided at a Network
Termination Point on the Applicable Systems not previously so provided
a notice is published specifying the technical characteristics of the
interface introduced.

12.3      The technical characteristics to be included in such a
notice shall include:

          (a)  physical, electrical and other relevant
               characteristics;

          (b)  network interworking and service management protocols;
               and

          (c)  reference to national and international standards and
               recommendations with which the interface complies,

in sufficient detail for compatible terminal apparatus to be produced,
tested and approved.

12.4      Subject to paragraph 12.5, any notice under this Condition
shall be published in a manner appropriate for bringing the matters to
which the notice relates to the attention of persons likely to be
affected by or to have an interest in them.

12.5      Where the Director following any representation or
observation made to him reasonably concludes that a notice under
paragraph 12.2 has not been published in an appropriate manner he may
direct the Licensee to carry out such further publication as he
considers reasonably necessary to meet the requirements of
paragraph 12.4.


<PAGE>

                                                                  Condition 13

METERING AND BILLING ARRANGEMENTS

13.1      This Condition shall only apply where the Applicable Systems
are connected to a telecommunication system not run under a Licence
issued to a particular person.

13.2      As regards any description of Meter in use on a date
specified by the Director in connection with the Applicable Systems
and which has been specified by the Director, the Licensee shall apply
for Approval as soon as is practicable and in any case not later than
such date as the Director may determine in relation to that
description of Meter.

13.3      As regards any description of Meter specified by the
Director and not in use in connection with the Applicable Systems on
the date specified under paragraph 13.2, the Licensee shall, unless
the Director consents otherwise, apply for Approval not later than
such date as is further specified by the Director or not fewer than
six months before the date on which the Licensee intends to bring that
Meter into such use, whichever shall be the later.

13.4      The Licensee shall not after such date as the Director may
determine in relation to any description of Meter so specified by him,
keep in use or bring into use in connection with the Applicable
systems, any Meter of a description so specified which is not Approved
or for which the Licensee has not made an application for Approval.

13.5      Where Approval is not granted to or is withdrawn from a
particular description of Meter the Licensee shall, as soon as is
reasonably practicable, either;

          (a)  inform the Director of the action to be taken by the
               Licensee to remedy the absence of Approval in relation
               to that description of Meter and the anticipated date
               of such Approval; or

          (b)  inform the Director that the Licensee intends to cease
               use of that description of Meter in connection with the
               Applicable Systems within a time reasonably practicable
               for the Licensee whereupon, on request of the Director,
               the Licensee shall provide the Director with a
               timetable for the withdrawal of that description of
               Meter.

13.6      The Licensee shall not render any bill in respect of any
description of telecommunication Service provided by means of the
Applicable Systems unless every amount (other than an indication of
unit charge) stated in that bill is no higher than an amount which
represents the true extent of any such Service actually provided by
the Licensee to the customer in question.  In this paragraph
"customer" does not include an Operator.

13.7      Without prejudice to the generality of paragraph 13.6 the
Licensee shall at all times maintain in operation such a Billing
Process as facilitates compliance by the Licensee with, and is
calculated to prevent contravention by it of, that paragraph.

13.8      The Licensee shall not be regarded as being in contravention
of its obligation under paragraph 13.6 except where the failure is in
relation to the Billing Process and the Licensee has failed to take
all reasonable steps to prevent a contravention of that obligation.

13.9      The Licensee shall keep such records as may be necessary or
as may be determined by the Director to be necessary for the purpose
of satisfying the Director that the Billing Process has the
characteristics required by paragraph 13.7, provided that nothing in
this paragraph shall require the Licensee to retain any records for
more than 2 years from the date on which they came into being.

13.10     For the purpose of giving the Director an independent
quality assurance from time to time that the Billing Process has the
characteristics required by paragraph 13.7, the Licensee shall, where
the Director has prima facie grounds to believe the Billing Process
does not have those characteristics and has so notified the Licensee,
extend its prompt co-operation to the Director and, in particular, on
request by the Director shall;

          (a)  furnish the Director in accordance with the Director's
               reasonable requirements any Information, document
               (including any facility enabling him to read data not
               held in readable form) or other thing;

          (b)  carry out (or cause to be carried out by such person
               having such special expertise as the Director may
               specify and to whom the Director has raised no
               reasonable objection) in such manner as the Director
               may specify an examination of the whole or of any part
               of the Billing Process and as soon as practicable after
               the conclusion of such examination furnish to the
               Director a written report by the Licensee or that
               specified person, as the case may be, of the results of
               such examination;

          (c)  on reasonable notice by him allow at all reasonable
               times the Director and, in the case of any member of
               his staff, on production of his special authority in
               that behalf, access to any relevant premises, plant or
               equipment of the Licensee;

          (d)  on reasonable notice by him allow at all reasonable
               times the Director and, in the case of any member of
               his staff, on production of his special authority in
               that behalf, to examine or test the whole or any part
               of the Billing Process including any plant or equipment
               whether or not forming part of the Applicable Systems;

          (e)  for the purpose of paragraphs 13.10(c) and 13.10(d),
               allow the Director to be accompanied by any person as
               the Director may specify and to whom the Licensee has
               raised no reasonable objection whose assistance he
               might reasonably require for the purpose described at
               the beginning of this paragraph provided that the
               Director shall have given the Licensee notice (save in
               exceptional circumstances) of at least 5 working days
               of the identity of that person; and

          (f)  install and keep installed any equipment (whether or
               not supplied by the Director) for the purpose of
               verifying;

               (i)     the accuracy and reliability of any equipment
                       or apparatus (including any Meter) of the
                       Licensee;

               (ii)    in the case of any Meter which is or is
                       required to be Approved and is in use in
                       connection with the Applicable Systems,
                       compliance with any conditions or other matters
                       which may be required as regards such use of
                       that Meter.

13.11     In this Condition:

          (a)  "Approval" and "Approved" mean approval and approved
               under section 24 of the Act;

          (b)  "Billing Process" means Metering systems and Billing
               Systems taken together, where "Billing System" means
               the totality of all apparatus, data, procedures and
               activities which the Licensee employs to determine the
               charges to be sought for Service usage recorded by a
               Metering System based on published or previously
               negotiated pricing structures and to present these
               charges on customers' bills and "Metering System" means
               the totality of all apparatus, data, procedures and
               activities which the Licensee employs to determine the
               extent of any telecommunication Services provided by
               means of the Applicable Systems;

          (c)  "Information" includes accounts, estimates and returns;

          (d)  "Meter" means any system or apparatus constructed or
               adapted for use in ascertaining the extent of
               telecommunication Services provided by means of the
               Applicable Systems; and

          (e)  "Service" includes any service provided by any person
               to whom the Licensee is bound to account for any part
               of the amount charged by the Licensee.


<PAGE>

                                                                  Condition 14

NUMBERING ARRANGEMENTS

14.1      This Condition shall only apply where the Applicable Systems
are connected to a telecommunication system not being run under a
Licence issued to a particular person, or where the Licensee has been
granted Numbers by the Director.

14.2      The Licensee shall from the day on which it first provides a
switched telecommunication service or any other telecommunication
service in connection with which the Licensee allocates to users
Numbers adopt a Numbering Plan and shall furnish details thereof to
the Director and on request to any other person having a reasonable
interest.

14.3      The Numbering Plan shall describe the method adopted and to
be adopted for allocating and re-allocating in respect of each Network
Termination Point such Number or Numbers as may be necessary for each
item of Relevant Apparatus or each Relevant System that is or is to be
connected by means of that Network Termination Point to any of the
switched Applicable Systems.

14.4      The Licensee shall install, maintain or adjust its switched
Applicable Systems so that those Systems convey Messages to Network
Termination Points in respect of which Numbers have been allocated in
accordance with the Numbering Plan.

14.5      The Licensee shall from time to time consult:

          (a)  the Director about the arrangements for the allocation
               and reallocation of Numbers within the Numbering Plan;
               and

          (b)  in one body approved by the Director for the purpose
               and representative of telecommunications operators and
               other persons whom the Director considers appropriate
               about any developments of, additions to or replacements
               of, the Numbering Plan.

14.6      The Licensee shall from time to time prepare, taking into
account the consultations mentioned in paragraph 14.5(b), and furnish
to the Director proposals for developing, adding to or replacing the
Numbering Plan and changing the switched Applicable Systems to the
extent necessary to secure that:

          (a)  sufficient Numbers are made available, having regard to
               the anticipated growth in demand for telecommunication
               services, for a Number or Numbers to be allocated
               without undue delay;

          (b)  Numbers include as few digits as practicable and their
               allocation does not confer any undue advantage on the
               Licensee or undue disadvantage on persons running
               Relevant Systems;

          (c)  the cost of changing any of the switched Applicable
               Systems or any Relevant Apparatus or Relevant System in
               order to accommodate the revised Numbering Plan is
               reasonable; and

          (d)  inconvenience caused by the alteration of the Numbering
               Plan to the Licensee and to persons using Relevant
               Apparatus or Relevant Systems in respect of which
               Numbers have previously been allocated is minimised.

14.7      If the Director determines that the Numbering Plan with any
developments, additions and replacements submitted in accordance with
paragraph 14.6 is sufficient to provide compatibility with the
numbering arrangements applied or to be applied by telecommunications
operators and to meet the objectives specified in paragraph 14.6 the
Licensee shall adopt the Numbering Plan but, if the Director
determines that it is not compatible with numbering arrangements
applied or to be applied by another public telecommunications operator
or will not be sufficient to achieve the objectives specified in
paragraph 14.6, then the Licensee shall adopt the Numbering Plan with
such developments, additions or replacements as the Director may
determine are best calculated to secure the objectives specified in
paragraph 14.6.

14.8      Before making a determination under paragraph 14.7 the
Director shall take account of:

          (a)  the state of technical development of the Applicable
               Systems and the Licensee's plans for their commercial
               development;

          (b)  the balance of advantage between:

               (i)     making developments of, additions to or
                       replacements of numbering arrangements applied
                       or to be applied, or making changes to systems
                       run, by others; and

               (ii)    making any requirement of the Licensee;

          (c)  the cost to the Licensee and to those to whom the
               Licensee provides telecommunication services arising
               from any determination;

          (d)  any obligations and recommendations of the
               International Telecommunication Union which apply to
               Her Majesty's Government and are accepted by it and any
               other standard to which the Director consents for the
               purpose from time to time; and

          (e)  the views of the Licensee and such other persons
               (including operators of telecommunication systems,
               those to whom telecommunication services are provided
               or telecommunication apparatus is supplied and
               producers of telecommunication apparatus) as appear to
               the Director to have an interest in the matter.

14.9      Where the Licensee has adopted a Numbering Plan in
accordance with paragraph 14.7, or the Director has made a
determination under that paragraph (by virtue of which the Licensee
shall adopt the Numbering Plan), the Numbering Plan so adopted shall
be the Licensee's Numbering Plan until the Licensee adopts a Numbering
Plan pursuant to the following provisions of this Condition.  The
Numbering Plan referred to in the following provisions of this
Condition is the Numbering Plan adopted pursuant to those provisions.

14.10     The Director may determine a Specified Numbering Scheme (the
"Scheme") in accordance with the National Numbering Conventions (the
"Conventions") published in accordance with paragraph 14.14 and he
will allocate Numbers from this Scheme to the Licensee in accordance
with the Conventions.  The initial allocation of Numbers to the
Licensee shall be of those Numbers to which the Numbering Plan
referred to in paragraph 14.3 relates and of any other Numbers to
which any other Numbering Plan in force immediately before such
allocation relates, provided that, at such time of initial allocation,
those Numbers are currently in use by the Licensee, and where not so
in use, the Director shall have due regard to the Licensee's plans and
future requirements for its use and allocation of additional Numbers. 
The Director shall, at the request from time to time of the Licensee,
allocate to it:

          (a)  such quantity of additional Numbers as it may require;
               and

          (b)  in accordance with the Conventions, such specific
               Numbers as it may request and which the Director is
               satisfied are not required for other purposes.

14.11     The Licensee shall adopt a Numbering Plan for such Numbers
as the Director may allocate to it from time to time in accordance
with the Conventions.  It shall within three months of being notified
of such allocation furnish details of the Numbering Plan to the
Director, and keep him informed of material changes to the Numbering
Plan as they occur.  The Licensee shall also furnish details of the
Numbering Plan together with any material changes to that Numbering
Plan on request to any other person having a reasonable interest. 
Except where the Director agrees otherwise, the Numbering Plan shall
be consistent with the Conventions published in accordance with
paragraph 14.14. If the Numbering Plan is not consistent with those
Conventions, the Director may direct the Licensee to adopt and furnish
him with a new Numbering Plan or to take such other reasonable
remedial action which does not cause undue inconvenience to the
Licensee's customers, as may be necessary to ensure consistency.

14.12     The Licensee shall install, maintain and adjust its switched
Applicable Systems so that those Systems route Messages and otherwise
operate in accordance with the Numbering Plan.  The Licensee shall not
use Numbers other than those allocated to it from the Scheme except:

          (a)  with the written consent of the Director; or

          (b)  where the use of those Numbers is the subject of an
               agreement to which Condition 5 applies.

14.13     (a)  The Licensee shall provide to the Director, on request,
               such information about its operations under its
               Numbering Plan as he may reasonably require to
               administer the Scheme and in particular on:

               (i)     the percentages of Numbers in significant
                       ranges which have already been allocated to
                       end-users or which for other reasons are
                       unavailable for further allocation;

               (ii)    any allocation of blocks of Numbers to any
                       person for purposes other than end use;

               (iii)   Numbers whose use has been transferred at an
                       end-user's request to another Operator; and

               (iv)    the Licensee's current forecasts of all of the
                       above matters.

          (b)  The Licensee shall not be required to provide
               information about individual end-user customers.

          (c)  In making any such request the Director shall ensure
               that no undue burden is imposed on the Licensee in
               procuring and furnishing such information and, in
               particular, that the Licensee is not required to
               procure or furnish information which would not normally
               be available to it, unless the Director is satisfied
               that such information is essential to the
               administration of the Scheme.

14.14     (a)  The Conventions referred to in this Condition will be a
               set of principles and rules published from time to time
               by the Director after consultation with interested
               parties who are members of the Telecommunications
               Numbering and Addressing Body and, if deemed
               appropriate, with end-users.

          (b)  In consulting the said interested parties, the Director
               shall afford a reasonable period, not being less than
               28 days, for them to make representations, and he shall
               take the said representations into account when
               publishing the Conventions.  The Conventions shall
               govern the specification and application of the Scheme
               and the Numbering Plan of the Licensee and may also
               include such other matters relating to the use and
               management of Numbers as (but not limited to):

               (i)     criteria and procedures relating to the
                       application for, allocation of and withdrawal
                       of Numbers;

               (ii)    dialling plans;

               (iii)   access codes;

               (iv)    prefixes;

               (v)     standard ways of recording Numbers for
                       convenience or ease of use, such as the
                       grouping of digits in Numbers of particular
                       lengths; and

               (vi)    methods of enabling end-users to understand the
                       meaning implicit in Numbers or other dialled
                       digits, and in particular the rate at which a
                       call to a particular Number will be chargeable.

          (c)  The Director may from time to time amend or withdraw a
               Convention already published, after consultation with
               interested parties who are members of the
               Telecommunications Numbering and Addressing Body.  The
               Licensee shall not be required to comply with any such
               amendment or withdrawal unless the Licensee has been
               given a reasonable period of notice, such notice not
               being less than three months.  Numbers allocated to the
               Licensee may only be withdrawn after similar
               consultation and notice, and the Director shall consult
               end-users affected by such withdrawal.  Subject to
               overriding national interests, or where there is no
               alternative solution available, the power to withdraw
               Numbers shall not apply to any Numbers which the
               Director has approved from time to time as part of a
               specific service of the Licensee, which, as a result of
               investment by the Licensee, has a recognised identity
               and quality associated with that particular Number and
               which the Licensee is using and plans to continue to
               use.

14.15     In deciding on the details of and any subsequent changes to
the Scheme and the Conventions, and when making or changing Number
allocations within the Scheme or making determinations under this
Condition, the Director shall ensure that the Scheme complies with the
Conventions and shall have regard to:

          (a)  the need for sufficient Numbers to be made available,
               having regard to the anticipated growth in demand for
               telecommunication services, together with the need for
               good husbandry of that supply at any time;

          (b)  the need to ensure Compatibility with the Numbering
               Plans adopted or to be adopted by telecommunications
               operators;

          (c)  the convenience and preferences of end-users;

          (d)  the requirements of effective competition;

          (e)  the practicability of implementing the Conventions in
               licensed systems by the date when the Conventions are
               intended to apply;

          (f)  any costs or inconvenience imposed on the Licensee,
               other telecommunications operators, end-users and other
               interested parties (including those overseas);

          (g)  any relevant international agreements, recommendations
               or standards;

          (h)  the views of the Licensee and other interested parties;
               and

          (i)  any other matters he regards as relevant.

14.16     The Licensee shall not, unless the Director consents
otherwise, charge any person for a Number which is allocated to him
(other than a coveted Number allocated to a person who is not a public
telecommunications operator at the request of such a person), but
nothing in this Condition shall preclude the Licensee from recovering
from the operator of a Relevant System the reasonable costs associated
with allocating Numbers to and routing calls to that System; save that
in the case of any dispute or difference as to those costs the
Director may determine them and the Licensee shall not be obliged so
to allocate Numbers and route calls unless such operator agrees to
bear the costs so determined.

14.17     For the purposes of this Condition, "Telecommunications
Numbering and Addressing Body" means a body approved by the Director
as representative of the Licensee and other persons whom the Director
considers it appropriate to include in consultations about the content
of the Conventions and the Scheme.

14.18     For the avoidance of doubt, it is hereby declared that this
Condition applies notwithstanding any arrangements for numbering
arising by virtue of any agreement to which Condition 5 applies.  But
nothing in this paragraph shall affect the operation of any such
agreements entered into before the coming into force of this Licence.

14.19     The Numbers to which this Condition applies are Numbers:

          (a)  of a class described in CCITT Recommendation E.160,
               E.163, E.164, E.165, E.166 or F.69 or their functional
               successors; or

          (b)  which are of a class described in CCITT Recommendation
               X.121 and which include any Data Network Identification
               Code which has been:

               (i)     allocated before 14 November 1986 in accordance
                       with a Numbering Plan furnished to the
                       Director; or

               (ii)    specified by the Director for the purposes of
                       this Licence and described in a list kept for
                       that purpose by the Director and made available
                       by him for inspection to the general public.



<PAGE>

                                                               Condition    15

ARRANGEMENTS FOR PROPORTIONATE RETURN

15.1      This Condition shall apply in respect of the conveyance of
Messages to or from each country and territory in the world other than
as specified from time to time by the Secretary of State.

15.2      Except insofar as the Director may otherwise consent in
writing, the Licensee shall ensure (using the most up-to-date
information available) that over each quarterly period for each
Accounting Rate Service the First Ratio shall be no greater than the
Second Ratio.

15.3      Where it appears to the Director that in respect of any
country or territory the obligation imposed by paragraph 15.2 is being
breached, he may make a determination to that effect and the Licensee
shall take such steps as the Director may direct for the purpose of
remedying the situation.  In particular, and without prejudice to the
generality of the foregoing, any such direction may require the
Licensee to cease to convey any Messages to
that country or territory.

15.4      In this Condition:

          "First Ratio"  means the volume of Messages comprised in
                         each Accounting Rate Service which are
                         conveyed by the Applicable Systems and are
                         delivered to the United Kingdom divided by
                         the volume of all Messages comprised in each
                         Accounting Rate Service which are delivered
                         to the United Kingdom; and

          "Second Ratio" means the volume of all Messages comprised in
                         each Accounting Rate Service which are
                         conveyed by the Applicable Systems and are
                         sent from the United Kingdom divided by the
                         volume of all Messages comprised in each
                         Accounting Rate Service which are sent from
                         the United Kingdom.


<PAGE>

                                                                  Condition 16

ARRANGEMENTS FOR ACCOUNTING IN RESPECT OF INTERNATIONAL CONVEYANCE
SERVICES

16.1      This Condition shall apply in respect of the conveyance of
Messages to or from each country and territory in the world other than
as specified from time to time by the Secretary of State.

16.2      The Licensee shall inform the Director of accounting rates
and methods of settlement and division of the accounting rates agreed
for all Accounting Rate Services, before those rates are put into
operation.

16.3      As soon as practicably possible after making any
correspondent arrangement with an overseas operator, the Licensee
shall inform the Director and all other holders of a Licence
authorising the provision of International Conveyance Services in the
United Kingdom and who are operating, or who have announced an
intention to operate on that particular route, of the terms of that
arrangement, in particular and without prejudice to the generality of
the foregoing, including details of any changes to existing accounting
rates or methods of settlement or division of the accounting rates.

16.4      Where it appears to the Director that any accounting rate or
methods of settlement or division of the accounting rates agreed by
the Licensee in respect of any Accounting Rate Service has or is
likely to have an effect to the detriment of providers and users of
International Conveyance Services in the United Kingdom, he may make a
determination to that effect and the Licensee shall take such steps as
the Director may direct for the purpose of remedying the situation. 
In particular, and without prejudice to the generality of the
foregoing, any such direction may require the Licensee to cease to
convey any Messages to that country or territory.


<PAGE>

                                                                  Condition 17

PROHIBITION OF EXCLUSIVE DEALING IN INTERNATIONAL SERVICES

17.1      The Licensee shall not enter into any agreement or
arrangement with any person running an Authorised Overseas System on
terms or conditions which unfairly preclude or restrict the provision
by another public telecommunications operator of International
Conveyance Services.

17.2      The Licensee shall not unreasonably exclude any other public
telecommunications operator who is authorised by a licence to connect
his system to another telecommunication system situated outside the
United Kingdom so as to convey Messages to that other system from a
reasonable opportunity to participate in any international
arrangements into which it proposes to enter after the date on which
this Licence enters into force for the installation and operation of
any submarine cable linking any of the Applicable Systems to any
telecommunication system outside the United Kingdom.


<PAGE>

                                                                  Condition 18

NOTIFICATION OF CHANGES IN SHAREHOLDINGS

18.1      The Licensee shall notify the Secretary of State if an
undertaking becomes a Parent Undertaking in relation to the Licensee.

18.2      Subject to paragraph 18.3, the Licensee shall notify the
Secretary of State of:

          (a)  any change in the proportion of the Shares held in a
               Relevant Company by any person;

          (b)  the acquisition of any Shares in a Relevant Company by
               a person not already holding any such Shares, and the
               proportion of any such Shares held by that person
               immediately after that acquisition.

18.3      The Licensee shall be obliged to notify the Secretary of
State of any acquisition of Shares or change in the Shareholding of a
Relevant Company by any person only if, by reason of that acquisition
or change, the total number of Shares in that Relevant Company held by
that person otherwise than as trustee or nominee for another person
together with any Shares held by any nominee or trustee for that
person immediately after that change or acquisition:

          (a)  exceeds 15 per cent of the total number of Shares in
               that company (where it did not exceed 15 per cent prior
               to that change or acquisition);

          (b)  exceeds 30 per cent of the total number of Shares in
               that company (where it did not exceed 30 per cent prior
               to that change or acquisition); or

          (c)  exceeds 50 per cent of the total number of Shares in
               that company (where it did not exceed 50 per cent prior
               to that change or acquisition),

provided that where a Relevant Company is a public company as defined
in section 1 of the Companies Act 1985, the obligation shall be
discharged by forwarding to the Secretary of State as soon as
practicable all information in respect of that acquisition or that
change as is entered on or received for entry on the register required
to be maintained by that Relevant Company under section 211 of the
Companies Act 1985.

18.4      In any case referred to in paragraph 18.1 or 18.2,
notification shall be given by a date which is 30 days prior to the
taking effect of such change or acquisition, as the case may be, or as
soon as practicable after that date.


<PAGE>

                                                                  Condition 19

LICENSEE'S GROUP

19.1      Without prejudice to the Licensee's obligations under these
Conditions in respect, in particular, of anything done on its behalf,
where:

          (a)  the Director determines either:

               (i)     that a member of the Licensee's Group has done
                       something which would, if it had been done by
                       the Licensee, be prohibited or not be
                       authorised under these Conditions; or

               (ii)    that a member of the Licensee's Group has done
                       something which would, if it had been done by
                       the Licensee, require the Licensee to take or
                       refrain from taking a particular action under
                       these Conditions and that neither the Licensee
                       nor the member has met that further
                       requirement; and

          (b)  the Director is not satisfied that the Licensee has
               taken all reasonable steps to prevent any member acting
               in that way,

then the Director may direct the Licensee to take such steps as the
Director deems appropriate for the purpose of remedying the matter,
including refraining from carrying on with that member such commercial
activities connected with telecommunications as the Director may
determine.

19.2      Where these Conditions apply in respect of the Applicable
Systems they do not apply in respect of any other telecommunication
system, whether run by the Licensee or another.

19.3      Where any person becomes a member of the Licensee's Group
then the Licensee shall not be subject to paragraph 19.1 before that
is reasonably practicable but shall be so not later than one year
after that person becomes such a member or such later date as the
Director may determine.

19.4      This Condition shall not apply to any particular member of
the Licensee's Group if and to the extent that the Director so
determines.


<PAGE>

                                                                  Condition 20

PAYMENT OF FEES

20.1      The Licensee shall pay the following amounts to the
Secretary of State at the times stated:

          (a)  on the grant of this Licence the sum of 7,000;

          (b)  on 1 April 1997 a renewal fee of (at the option of the
               Director) either 8,000 or such amount which shall
               represent a fair proportion, to be determined each year
               by the Director according to a method that has been
               disclosed to the Licensee, of the estimated costs to be
               incurred in that fiscal year by the Director in the
               regulation and enforcement of telecommunication
               licences and in the exercise of his other functions
               under the Act.  The first renewal fee shall be reduced
               by the proportion which the period from the date of
               granting of this Licence until the next following 1 April 
               1997 bears to the period of one year; and

          (c)  when the Director so determines, a special fee which
               shall represent a fair proportion, to be determined by
               the Director according to a method that has been
               disclosed to the Licensee of the amount, if any, by
               which the aggregate of:

               (i)     the costs estimated to have been already
                       incurred in that fiscal year by the Director in
                       the regulation and enforcement of
                       telecommunication licences and in the exercise
                       of his other functions under the Act;

               (ii)    the costs estimated to have been already
                       incurred in that fiscal year by the Monopolies
                       and Mergers Commission following licence
                       modification references under section 13 of the
                       Act; and

               (iii)   the estimated costs to be incurred in the
                       remainder of that fiscal year:

                       (A)  by the Director in the regulation and
                            enforcement of telecommunication licences
                            and in the exercise of his other functions
                            under the Act; and

                       (B)  by the Monopolies and Mergers Commission
                            following licence modification references
                            under section 13 of the Act, 

               exceeds the renewal fee for that year, 

save always that the aggregate of the renewal fee and the special fee
for any fiscal year shall not exceed 0.08% of the annual turnover of
the Systems Business in the financial year before the last complete
financial year of the Licensee before the renewal fee is payable, or
35,000 (adjusted in the manner described in paragraph 20.1(b),
whichever is the greater (the "normal aggregate fee"), unless the
Director determines that the costs incurred in any fiscal year by him
and the Monopolies and Mergers Commission in respect of the Licensee's
activities exceeds the normal aggregate fee, in which case the
aggregate of the renewal fee and the special fee for the following
year shall be such amount as the Director determines is sufficient to
take account of that excess as well as of the other costs to be
incurred as mentioned in this paragraph.


<PAGE>

                                                                  Condition 21


REQUIREMENT TO FURNISH INFORMATION TO THE DIRECTOR

21.1      Without prejudice to Condition 22, the Licensee shall
furnish to the Director, in such manner and at such times as the
Director may reasonably request, such documents. accounts, estimates,
returns or other information and procure and furnish to him such
reports as he may reasonably require for the purpose of exercising the
functions assigned or transferred to him by or under Parts II and III
of the Act.

21.2      In making any such request the Director shall ensure that no
undue burden is imposed on the Licensee in procuring and furnishing
such information and, in particular, that the Licensee is not required
to procure or furnish a report which would not normally be available
to it unless the Director considers the particular report essential to
enable him to exercise his functions.


<PAGE>

                                                                  Condition 22


REQUIREMENT TO SUBMIT ACCOUNTS TO THE DIRECTOR

22.1      The Licensee shall maintain such accounting records dealing
separately with its International Business carried on in the United
Kingdom as will enable it to show separately and explain, in response
to any request from the Director under paragraph 22.4. all the
transactions to which paragraph 22.2 refers.

22.2      This paragraph refers to:

          (a)  all transactions between each Relevant International
               Function run as part of the Licensee's International
               Business; and

          (b)  all transactions between the Licensee's International
               Business and:

               (i)     any other business carried on by the Licensee
                       whether in the United Kingdom or elsewhere; or

               (ii)    the business of any Associated Person whether
                       in the United Kingdom or elsewhere.

22.3      The Licensee shall update the accounting records referred to
in paragraph 22.1 no less frequently than monthly and those records
shall include in particular the costs (including capital costs),
revenue and a reasonable assessment of assets employed in and
liabilities attributable to the International Business and,
separately, the amount of any material item of revenue, cost, asset or
liability which has been either:

          (a)  charged from or to any other business of the Licensee
               or Associated Person together with a description of the
               basis of the value on which the charge was made; or

          (b)  determined by apportionment or attribution from an
               activity common to the business and any other business
               of the Licensee or any Associated Person and, if not
               otherwise disclosed, the basis of the apportionment or
               attribution.

22.4      The Director may at any time request from the Licensee
copies of any of the accounting records and detailed attribution
policies and procedures which the Licensee is obliged to maintain by
this Condition, covering any period between:

          (a)  the date on which the Licensee first carried on any
               International Business in the United Kingdom or, if
               later, the date of this Licence; and

          (b)  the date on which such records were, or should have
               been, last updated in accordance with paragraph 22.3.

The Licensee shall provide any such records requested by the Director
within 28 days of receiving such a request in writing.

22.5           (i)     Accounting records submitted to the Director
               shall, so far as reasonably practicable, be prepared in
               the formats and in accordance with the accounting
               principles and rules which apply to the annual
               statutory accounts of the Licensee and shall state the
               attribution policies and procedures used and where the
               Licensee is a body corporate incorporated outside the
               United Kingdom the preparation and adoption of those
               accounts shall comply with the requirements of
               sections 226 and 231 to 234A of the Companies Act 1985
               as if that body corporate were incorporated in the
               United Kingdom.

               (ii)    The Licensee shall procure in respect of each
               set of accounting records submitted to the Director an
               audit report which shall conform to UK auditing
               standards by the Auditor in which he shall state
               whether in his opinion the record complies with
               paragraph 22.1 and is fairly presented in accordance
               with the formats, accounting principles, rules and
               requirements referred to in paragraph 22.5(i).

22.6      Where it appears to the Director that to do so would be
beneficial to the promotion or maintenance of competition he may
direct the Licensee to publish the accounting statements submitted to
the Director in such way as he sees fit.  In so directing the Licensee
the Director shall have regard to the need for excluding, so far as
that is practicable, any matter where publication of that matter
might, in the opinion of the Director, seriously and prejudicially
affect the interests of the Licensee or any Associated Person.


<PAGE>

                                                                  Condition 23


EXCEPTIONS AND LIMITATIONS ON OBLIGATIONS IN SCHEDULE 1

23.1      Unless the context otherwise requires and subject to
paragraph 23.9, the Licensee's obligations under these Conditions have
effect subject to the following exceptions and limitations.

23.2      The Licensee is not obliged to do anything which is not
practicable.

23.3      The Licensee shall not be held to have failed to comply with
an obligation imposed upon it by or under these Conditions if and to
the extent that the Licensee is prevented from complying with that
obligation by any physical, topographical or other natural obstacle,
by the malfunction or failure of any apparatus or equipment owing to
circumstances beyond the control of the Licensee, by the act of any
national authority, local authority or international organisation or
as the result of fire, flood, explosion, accident, emergency, riot or
war.

23.4      An obligation to provide any telecommunication service shall
not apply:

          (a)  where there is no reasonable demand for it; or

          (b)  where provision of the service requested would expose
               any person engaged in its provision to undue risk to
               health or safety; or

          (c)  where the Licensee is unable to obtain (either because
               it has not been developed or for some other reason
               beyond the Licensee's control) anything necessary to
               provide a service of the quality or standard required
               by the person who requests the provision of the service
               and, in the event of dispute, the Director's decision
               as to whether anything is necessary shall be final; or

          (d)  where the person to whom the Licensee would otherwise
               be under an obligation to provide any service requests
               a service at a place in which the apparatus necessary
               to provide that service in that area has not been
               installed (or in which the installation of such
               apparatus has not been completed) or as the case may be
               such apparatus has not been adapted or modified to make
               it capable of providing that service or the trained
               manpower necessary to provide that service is not
               available in that area, provided that in every case
               where the Licensee declines to provide a service to
               which this paragraph relates it shall have published,
               or furnished to the Director, within 28 days (or such
               longer period as the Director considers reasonable)
               following receipt by it of the request that that
               service be provided, proposals for:

               (i)     progressively installing, or completing the
                       installation, adaptation or modification of,
                       the apparatus; or

               (ii)    the allocation of the trained manpower,
                       necessary for the provision of that service in
                       that area and the Director has not determined
                       that those proposals are unreasonable or are
                       not being effectively carried out; or

          (e)  where the person to whom the Licensee would otherwise
               be under an obligation to provide any service requests
               a service at a place in an area in which the demand or
               the prospective demand for the service is not
               sufficient, having regard to the revenue likely to be
               earned from the provision of the service in that area,
               to meet all the costs reasonably to be incurred by the
               Licensee in providing the service there, including:

               (i)     the cost of apparatus necessary for the
                       provision of the service there;

               (ii)    the cost of installing, maintaining and
                       operating such apparatus for the purpose of
                       providing the service there; and

               (iii)   the cost of the trained manpower necessary to
                       provide the service there; or

          (f)  where in the opinion of the Director it is not
               reasonably practicable in all the circumstances for the
               Licensee to provide the service requested at the time
               or place demanded.

23.5      The Licensee shall not be obliged to connect or to keep
connected to the Applicable Systems or to permit to be so connected or
kept connected any telecommunication system or telecommunication
apparatus or to provide telecommunication services or to permit the
provision of any service if the person to or for whom that is or is to
be done:

          (a)  has not entered or will not enter into a contract for
               the purpose with the Licensee for reasons other than
               the unreasonable refusal of the Licensee to agree terms
               for the purpose but this paragraph does not apply in a
               case where the Director is satisfied that:

               (i)     the Licensee has not published standard terms
                       and conditions which it proposes to apply for
                       the purpose in question, or the transaction is
                       not fit to be governed by such terms and
                       conditions; and

               (ii)    the Licensee has unreasonably refused to agree
                       terms and conditions for the purpose;

          (b)  is, or in the Director's opinion has given reasonable
               cause to believe that he may become:

               (i)     in breach of a contract with the Licensee for
                       the provision of telecommunication services by
                       the Licensee; or

               (ii)    in default in regard to any debt or liability
                       owed to the Licensee in respect of any such
                       contract;

          (c)  is using, or permitting the use of, apparatus so
               connected or kept connected for any illegal purpose or
               has done so in the past and is likely to do so again;
               or

          (d)  has obtained, or attempted to obtain, any
               telecommunication service from the Licensee by corrupt,
               dishonest or illegal means at any time.

23.6      Nothing in these Conditions shall prevent the Licensee from
withdrawing from, or declining to provide to, any person any
telecommunication service which the Licensee has notified the Director
that it is providing in a limited area, or to a limited class of
customers, for the purpose of evaluating the technical feasibility of,
or the commercial prospects for, that service.

23.7      Nothing in these Conditions shall require the Licensee to
provide any telecommunication service, or to provide any
telecommunication service of any particular class or description, if
it provides instead a service, or a service of a class or description,
which satisfies the purposes of that requirement at least to the same
extent.

23.8      This Condition shall apply without prejudice to any
limitation or qualification of the requirements imposed by or under
any other Condition.

23.9      This Condition does not apply to Condition 5, 8 or 10 and:

          (a)  only paragraphs 23.1, 23.2, 23.3 and 23.8 apply to
               Conditions 7, 13.2, 13.3, 19, 20 and 21;

          (b)  only paragraphs 23.1, 23.5(a) and 23.8 apply to
               Condition 4.2;

          (c)  only paragraphs 23.1, 23.2, 23.3, 23.5 and 23.8 apply
               to Condition 14;

          (d)  only paragraphs 23.1, 23.2, 23.3, 23.4(b), 23.5(a) and
               23.8 apply to Condition 3; and

          (e)  only paragraphs 23.1, 23.2, 23.3, 23.4, 23.6 and 23.8
               apply to Condition 4.1;

but paragraph 23.2 does not apply to Condition 9 or Condition 22.


<PAGE>

SCHEDULE 2:    REVOCATION


1.        Notwithstanding paragraph 3 of the Licence the Secretary of
State may at any time revoke this Licence by at least 30 days' notice
given to the Licensee in writing in any of the following
circumstances:

          (a)  if the Licensee agrees in writing with the Secretary of
               State that this Licence should be revoked; or

          (b)  if either

               (i)     an undertaking has become a Parent Undertaking
                       in relation to the Licensee; or

               (ii)    a change or acquisition of a description
                       specified in paragraphs 18.2 and 18.3 of
                       Condition 18 of Schedule 1 to this Licence has
                       taken place;

                       and either

               (iii)   the Licensee has duly notified the Secretary of
                       State in accordance with those paragraphs; or

               (iv)    the Licensee has failed to notify the Secretary
                       of State that such event, change or acquisition
                       has taken place in accordance with an
                       obligation under that Condition;

                       and

               (v)     the Secretary of State has notified the
                       Licensee in writing that he is minded to revoke
                       this Licence on the grounds either that:

                       (A)  the event, change or acquisition would in
                            his opinion be against the interests of
                            national security or relations with the
                            government of a country or territory
                            outside the United Kingdom; or

                       (B)  the Licensee has committed a breach of
                            Condition 18 of Schedule 1; and

               (vi)    the event, change or acquisition has not been
                       reversed or remedied within 30 days of the
                       receipt by the Licensee of such notification;
                       or

          (c)  if, following a change or acquisition of the type
               referred to in Condition 18 of Schedule 1 to this
               Licence, the Secretary of State considers, or the
               Director has notified the Secretary of State that the
               Director considers, that the Licensee is relying, has
               relied or is likely to rely on this Licence in
               circumstances in which an effect of such reliance is,
               was or may be that the Licensee or any member of the
               Licensee's Group is or was relieved wholly or in part
               of any obligation, limitation or restriction imposed by
               a Licence issued to the Licensee or any member of the
               Licensee's Group; or

          (d)  where the Licensee has failed to comply with a final
               order (or a provisional order confirmed) under
               section 16 of the Act and the Secretary of State has
               given the Licensee not less than 30 days' notice in
               writing that, if the Licensee fails to comply with the
               order within that period of 30 days, he intends to
               revoke the Licence, provided that no such notice of
               intention shall be given where the question of the
               validity of the order is the subject of any court
               proceedings, and where that question becomes so subject
               during the 30 day notice period, that period shall
               cease to run until the final disposal of those
               proceedings (including any Appeal); or

          (e)  if the Licensee:

               (i)     is deemed to be unable to pay its debts (within
                       the meaning of section 123 of the Insolvency
                       Act 1986 as applied for the purposes of this
                       Licence by paragraph 2(b)), convenes any
                       meeting with its creditors generally with a
                       view to the general readjustment or
                       rescheduling of its indebtedness or makes a
                       general assignment for the benefit of its
                       creditors generally; or

               (ii)    enters into administration, receivership or
                       liquidation; or

               (iii)   ceases to provide telecommunication services of
                       the type authorised in paragraph 3 of
                       Schedule 3 to this Licence; or

          (f)  if the Licensee or any other person takes any action
               for the voluntary winding-up or dissolution of the
               Licensee; or

          (g)  if the Licensee enters into any scheme of arrangement
               under the Insolvency Act 1986 (other than in any such
               case for the purpose of reconstruction or amalgamation
               upon terms and within such period as may previously
               have been approved in writing by the Secretary of
               State); or

          (h)  if an administrator, receiver, trustee or similar
               officer of the Licensee, or of all or any material part
               of the revenues and assets of it, is appointed; or

          (i)  if any order is made for the compulsory winding-up or
               dissolution of the Licensee; or

          (j)  if any amount payable under Condition 20 of Schedule 1
               is unpaid 30 days after it becomes due and remains
               unpaid for a period of 14 days after the Secretary of
               State notifies the Licensee that the payment is
               overdue.

2         For the purposes of paragraph 1(e)(i), in applying section 123 
of the Insolvency Act 1986:

          (a)  if a written demand served on the Licensee is satisfied
               prior to the expiry of the notice of revocation the
               Secretary of State shall not revoke the Licence; and

          (b)  the figure of " 750", or such other money sum as may be
               specified from time to time pursuant to sections 123(3)
               and 416 of the Insolvency Act 1986, shall be deemed to
               be replaced by " 250,000" or such higher figure as the
               Director may from time to time determine.

3         In this Schedule:

          (a)  "Group" means a parent undertaking and its subsidiary
               undertaking or undertakings within the meaning of
               section 258 of the Companies Act 1985 as substituted by
               section 21 of the Companies Act 1989; and "Licensee's
               Group" means a Group in respect of which the Licensee
               is either a parent undertaking or a subsidiary
               undertaking; and

          (b)  "Parent Undertaking" has the same meaning as in
               section 258 of the Companies Act 1985 as substituted by
               section 21 of the Companies Act 1989.

4         For the purposes of this Schedule "Appeal" includes further
appeal and application for leave to appeal or further to appeal.


<PAGE>

SCHEDULE 3:    AUTHORISATION TO CONNECT OTHER TELECOMMUNICATION
               SYSTEMS AND APPARATUS TO THE APPLICABLE SYSTEMS AND TO
               PROVIDE TELECOMMUNICATION SERVICES BY MEANS OF THE
               APPLICABLE SYSTEMS

1         Nothing in this Licence removes any need to obtain any other
licence that may be required under any other enactment.

Connection Authorisation

2         Subject to paragraph 1, this Licence authorises the
connection to the Applicable Systems of

          (a)  any telecommunication system run under a Licence;

          (b)  any telecommunication system outside the United Kingdom
               except a telecommunication system which the Secretary
               of State has notified the licensee should not, or as
               the case may be should cease to, be connected to the
               Applicable Systems;

          (c)  any earth orbiting apparatus, provided that:

               (i)     the relevant requirements, if any, for
                       consultation and compliance with specified
                       operating parameters under the INTELSAT
                       Agreement, INMARSAT Convention and EUTELSAT
                       Convention have been and continue to be
                       satisfied;

               (ii)    the relevant rules and standards, if any,
                       issued under the INTELSAT Operating Agreement,
                       INMARSAT Operating Agreement and EUTELSAT
                       Operating Agreement have been and continue to
                       be satisfied; and

               (iii)   it is not earth orbiting apparatus to which the
                       Secretary of State has notified the Licensee
                       that the Licensee should not, or as the case
                       may be should cease to, connect the Applicable
                       Systems;

          (d)  any telecommunication system run by the Crown;

          (e)  telecommunication apparatus of every description which
               is comprised in a telecommunication system mentioned in
               paragraphs 2(a) to 2(d);

          (f)  any telecommunication apparatus not comprised in the
               Applicable Systems which is for the time being
               Compliant Terminal Equipment or approved for connection
               to the Applicable Systems in accordance with section 22
               of the Act; and

          (g)  any hearing aid.

Service Authorisation

3         Subject to paragraph 1, this Licence authorises the
provision by means of the Applicable Systems of any telecommunication
services except:

          (a)  International Simple Voice Resale Services;

          (b)  International Simple Data Resale Services;

          (c)  conveyance of Messages for the delivery of one or more
               of the services specified in paragraphs (a) to (c) of
               section 72(2) of the Broadcasting Act 1990 for
               simultaneous reception in two or more Dwelling-Houses;

          (d)  conveyance of Messages which have originated in the
               United Kingdom and are subsequently to be terminated in
               the United Kingdom, unless:

               i)      such Messages are also to be conveyed over a
                       telecommunications system outside the United
                       Kingdom; or

               ii)     such Messages are conveyed in compliance with
                       any obligations imposed under Condition 2,
                       Condition 3 or Condition 4 in Schedule 1 of
                       this Licence; and

          (e)  any Mobile Radio Tails Service.

Definitions and interpretation

4         In this Schedule unless the context otherwise requires:

          (a)  "Applicable Terminal Equipment" means apparatus which
               is applicable terminal equipment within the meaning of
               regulation 4 of the Telecommunications Terminal
               Equipment Regulations 1992;

          (b)  "Compliant Terminal Equipment" means Applicable
               Terminal Equipment which satisfies the requirements of
               regulation 8 of the Telecommunications Terminal
               Equipment Regulations 1992,

          (c)  "Dwelling-House" has the same meaning as in section 202
               of the Broadcasting Act 1990;

          (d)  "EUTELSAT Convention" means the Convention establishing
               the European Telecommunications Satellite Organisation
               EUTELSAT including its Preamble and its Annexes, opened
               for signature by governments at Paris, France on 15
               July 1982, and any subsequent amendments made to it;

          (e)  "EUTELSAT Operating Agreement" means the Operating
               Agreement relating to the European Telecommunications
               Satellite Organisation EUTELSAT, including its Preamble
               and Annexes, opened for signature at Paris, France on
               15 July 1982, and any subsequent amendments made to it;

          (f)  "INMARSAT Convention" means the Convention establishing
               the International Mobile Satellite Organisation
               (formerly the International Maritime Satellite
               Organisation) INMARSAT including its Preamble and its
               Annex, opened for signature by governments at London,
               England on 3 September 1976, and any subsequent
               amendments made to it;

          (g)  "INMARSAT Operating Agreement" means the Agreement,
               including its Annex, opened for signature at London,
               England on 3 September 1976 by entities designated by
               governments party to the INMARSAT Convention, and any
               subsequent amendments made to it;

          (h)  "INTELSAT Agreement" means the Agreement including its
               Annexes but excluding all titles of Articles, opened
               for signature by governments at Washington DC, USA, on
               20 August 1971 by which the International
               Telecommunications Satellite Organisation INTELSAT was
               established, and any subsequent amendments made to it;

          (i)  "International Private Leased Circuit" means a
               communication facility which is:

               (i)     comprised both in a public telecommunication
                       system and in an equivalent telecommunication
                       system in a country or territory other than the
                       United Kingdom;

               (ii)    for the conveyance of Messages between points,
                       all of which are points of connection between
                       telecommunication systems referred to in
                       paragraph 4(i)(i) and other telecommunication
                       systems;

               (iii)   made available to a particular person or
                       particular persons;

               (iv)    such that all of the Messages transmitted at
                       any of the points mentioned in
                       paragraph 4(i)(ii) are received at every other
                       such point; and

               (v)     such that the points mentioned in
                       paragraph 4(i)(ii) are fixed by the way in
                       which the facility is installed and cannot
                       otherwise be selected by persons or
                       telecommunication apparatus sending Messages by
                       means of that facility;

          (j)  "International Simple Data Resale Services" means
               telecommunication services consisting in the conveyance
               of Messages which do not include two-way live speech,
               but include only such switching, processing, data
               storage or protocol conversion as is necessary for the
               conveyance of those Messages in real time, which have
               been or are to be conveyed by means of all of the
               following;

               (i)     a Public Switched Network;

               (ii)    an International Private Leased Circuit; and

               (iii)   the equivalent of a Public Switched Network in
                       another country or territory;

               provided that conveyance of a Message by means of a
               Public Switched Network or, as the case may be, the
               equivalent of a Public Switched Network in another
               country or territory shall be disregarded where that
               Message is so conveyed in circumstances specified for
               the time being by the Secretary of State as not being
               material for the purposes of paragraph 3 and included
               in a list kept for the purpose by the Director and made
               available by him for inspection by the general public:

          (k)  "International Simple Voice Resale Services" means
               telecommunication services consisting in the conveyance
               of Messages which include two-way live speech which
               have been or are to be conveyed by means of all of the
               following:

               (i)     a Public Switched Network;

               (ii)    an International Private Leased Circuit; and

               (iii)   the equivalent of a Public Switched Network in
                       another country or territory;

               provided that conveyance of a Message by means of a
               Public Switched Network or, as the case may be, the
               equivalent of a Public Switched Network in another
               country or territory shall be disregarded where that
               Message is so conveyed in circumstances specified for
               the time being by the Secretary of State as not being
               material for the purposes of paragraph 3 and included
               in a list kept for the purpose by the Director and made
               available by him for inspection by the general public;

          (l)  "Message" means anything falling within paragraphs (a)
               to (d) of section 4(1) of the Act;

          (m)  "Mobile Radio Tails Service" means a telecommunication
               service consisting in the conveyance of Messages
               through the agency of Wireless Telegraphy to or from
               the Applicable Systems directly from or to any
               apparatus designed or adapted to be capable of being
               used while in motion;

          (n)  "Private Leased Circuit" means a communication facility
               which is:

               (i)     provided by means of one or more public
                       telecommunications systems;

               (ii)    for the conveyance of Messages between points,
                       all of which are points of connection between
                       telecommunication systems referred to in
                       paragraph 4(n)(i) and other telecommunication
                       systems;

               (iii)   made available to a particular person or
                       particular persons;

               (iv)    such that all of the Messages transmitted at
                       any of the points mentioned in
                       paragraph 4(n)(ii) are received at every other
                       such point; and

               (v)     such that the points mentioned in
                       paragraph 4(n)(ii) are fixed by the way in
                       which the facility is installed and cannot
                       otherwise be selected by persons or
                       telecommunication apparatus sending Messages by
                       means of that facility;

          (o)  "Public Switched Network" means a public
               telecommunication system by means of which two-way
               telecommunication services are provided whereby
               Messages are switched incidentally to their conveyance,
               and, for the avoidance of doubt, a Public Switched
               Network does not include Private Leased Circuits or
               International Private Leased Circuits; and

          (p)  "Wireless Telegraphy" has the same meaning as in the
               Wireless Telegraphy Act 1949.

5         Expressions cognate with those referred to in this Schedule
shall be construed accordingly.


