The authors report on a novel design of etalon type dispersion compens
ating filter which is compact, low-loss, polarisation-insensitive, and
trackable to any wavelength From 1530 to 1565nm. In system tests we d
emonstrated nearly penalty-fret transmission over 160km of conventiona
l singlemode fibre at 10Gbit/s, and 40km at 20Gbit/s.