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Japan and the United States resumed telecommunications deregulation talks Monday in Tokyo in a bid to resolve their dispute over Japan’s telephone interconnection rates before the July 21-23 Group of Eight summit in Okinawa.

The two countries are at odds over how to reduce interconnection fees that Nippon Telegraph and Telephone Corp. charges its competitors to use its local networks. The previous round of talks was held in March.

Japan, which has insisted on a 22.5 percent cut to NTT’s access charges over four years, is expected to make a compromise proposal at the latest round of talks to break the impasse.

The U.S. has demanded that the interconnection fees be reduced by 22.5 percent in the first two years, with the reduction rate to be raised to 41.1 percent as early as possible after the initial cut.

Washington has set a July 28 deadline to decide whether it will file a complaint with the World Trade Organization over the issue.

Japan does not want the NTT issue to overshadow the G8 summit, the top agenda item of which will be promoting information technology — such as wider use of the Internet.

On Monday, the two countries were set to outline their respective positions on telecom deregulation issues.

Sadanori Amano, director general of the Telecommunications Bureau of the Posts and Telecommunications Ministry, and Assistant U.S. Trade Representative Wendy Cutler will focus on the NTT issue today.

It was reported last week that Japan was set to agree to the U.S. demands regarding the NTT fee cut, but confirmation has yet to be made.