"We feel that having a significant share of Iraq's telecommunication system owned by a company with major foreign government ownership is not necessarily be in the best interest of the Iraqi people," said Linton Wells, a deputy assistant secretary of defense.

"At the same time we feel that through teaming, through consortia, through various kind of arrangements, wideband bidders, including those that have government ownership, will be able to compete within the guidelines," he told reporters here.

Iraq's US-led coalition provisional authority has invited companies to submit bids by mid-August for licenses to provide wirelesss cellphone service in three Iraqi regions.

Wells said US authorities hope to award the contracts by early September "to ensure a rapid roll-out across the country of these capabilities."

The licenses will be for only 24 months in order not to tie the hands of any future Iraqi government.

Several hundred companies attended a bidders' conference in Amman on Thursday to learn more about the criteria governing the bids.

Concerns have been raised that Middle East cell phone providers would be excluded from the Iraqi market because many are state owned.

"We certainly don't want to have a sole source bid by a company that is 95 percent owned by a foreign government running one third of the Iraqi cellphones," Wells said. "On the other hand, it would probably be wise for a consortium to put in somebody with regional knowledge."

"So I don't think there is anything in any of this that would preclude a state-owned entity from participating. But they would have to do it in a consortium in such a way that it doesn't lead to the dominance of a foreign government," he said.

Wells also said the criteria were designed not to favor any competing cell phone technolgies.

"A key point on this solicitation is that it will be technologically neutral," he said.

"It is absolutely intended, and we have spent a lot of tiwme working to make sure that there is equal opportunity for GSM, CDMA or for that matter on the future UMTS, which is also a wideband next generation of GSM," he said.

Wells said Iraq already has some 320 cellphone towers but it had no cell phone system before the wark.

It has 3,000 kilometers of landlines, much of it fiber optic cables, but there is only limited phone services in major cities and no national service because central switching facilities in Baghdad were heavily damaged during the war, he said.

The Bechtel Corporation has a contract to make emergency repairs of the system.

Additional resources will be needed to rebuild and modernize it, however, Wells said.

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