AT&T-BellSouth merger back to square one?

The bearer of the potentially tie-breaking vote on a proposed merger between US telco giants AT&T and BellSouth has said ethics considerations prohibit him from participating.

The decision by federal communications commissioner Robert McDowell, a Republican sworn in earlier this year, is consistent with his earlier inclination to recuse himself from a decision on whether to approve the deal, now valued at more than $80bn.

He had declined to participate because immediately prior to joining the Federal Communications Commission, he spent seven years as an executive with the trade association Comptel, which lobbies for competitors of the Bell telephone companies.

McDowell said at a press conference at FCC headquarters in Washington: "To earn the public's trust in the integrity and impartiality of their government, in light of these factors, I find that I have no choice but to abide by the terms of my ethics agreement, heed the independent advice of the Office of Government Ethics and my ethics counsel, and ultimately to follow my own personal sense of ethics. Accordingly, I disqualify myself from this matter."

McDowell noted he signed an ethics agreement upon leaving Comptel that bars him for one year from participating in FCC matters involving the organisation. Comptel has filed comments with the FCC in opposition to the AT&T-BellSouth deal.

He urged his four colleagues, two Democrats and two Republicans, to return to the negotiating table and work out a unanimous agreement, as they did with mergers last year involving AT&T and SBC Communications, and Verizon and MCI.

McDowell said: "I fear that my recusal from this matter has been used as a pawn for some to forgo meaningful and severe negotiations."

The FCC has postponed action on the deal multiple times because the remaining two Democrats and two Republicans have reached a deadlock over which conditions, if any, to impose on the merger. US Department of Justice antitrust authorities approved the deal in October with no conditions.

An AT&T spokesman said the company plans to continue urging the federal regulators to sign off on its acquisition of Atlanta-based BellSouth as quickly as possible.

He said in a statement: "State regulators, minority organisations, small business groups, educational and community groups and elected officials from both the Democratic and Republican parties have all recognised the concrete benefits that our merger brings to consumers and the public interest."

Anne Broache writes for CNET News.com