DA 02-1889

**[Via Certified Mail, Return Receipt Requested]{.underline}**

Timothy E. Welch

Hill & Welch

1330 New Hampshire Ave., N.W. #113

Washington, D.C. 20554

**Re: [Auction No. 40 -- Petition for Reconsideration]{.underline}**

Dear Mr. Welch:

This letter responds to the petition filed on behalf of Mobilfone
Service, Inc. ("Mobilfone") seeking reconsideration of the Auctions and
Industry Analysis Division's denial of a bidding credit for licenses won
by Mobilfone in Auction No. 40.[^1] Mobilfone contends that its October
4, 2001 resubmitted short-form application (FCC Form 175) included
information sufficient to make it eligible for a bidding credit in
Auction No. 40. Alternatively, Mobilfone argues that the Paperwork
Reduction Act prohibits the Commission from penalizing Mobilfone for its
failure to comply with the Commission's requirement that applicants
seeking a bidding credit provide certain information on their short-form
applications. For the reasons discussed below, Mobilfone's arguments do
not merit reconsidering its bidding credit request.

Parties seeking to participate in Auction No. 40 were required to submit
a short-form application no later than 6 p.m. ET on September 17,
2001.[^2] The Commission's rules require applicants seeking bidding
credits to disclose certain information in their short-form
applications, in part by listing the names, addresses, and citizenship
of all officers, directors, and other controlling interests; and by
listing gross revenues of the applicant, its affiliates, its controlling
interests, and the affiliates of its controlling interests.[^3] The
Commission's rules also provide applicants a limited opportunity to cure
specified defects in their short-form applications and to resubmit a
corrected application.[^4] For Auction No. 40, parties could resubmit
corrected short-form applications until 6 p.m. ET on October 5,
2001.[^5]

Mobilfone timely submitted its initial short-form application. Upon
review, the Commission found Mobilfone's initial short-form application
incomplete.[^6] Mobilfone resubmitted its short-form application on
October 4, 2001. Mobilfone's October 4, 2001 resubmitted short-form
application did not identify which persons serve as Mobilfone's
corporate directors or officers, with the exception of its corporate
President.[^7] Therefore, Mobilfone's request for a bidding credit was
denied, although its short-form application to participate in Auction
No. 40 was accepted.[^8] Mobilfone participated in Auction No. 40
without a bidding credit. On November 15, 2001, well after bidding
commenced in Auction No. 40, Mobilfone filed its Petition.[^9]

Mobilfone must establish its eligibility for a bidding credit based on
information it submitted to the Commission prior to the October 5, 2001
short-form application resubmission deadline. After the October 5, 2001
resubmission period deadline, applicants could make only minor changes
or correct minor errors in their short-form applications.[^10] If an
applicant has not established eligibility for a bidding credit by the
resubmission deadline, any change that would make an applicant eligible
for a bidding credit would be an impermissible major change.[^11]

Mobilfone asserts that the Commission's rules require only that
applicants include the names, addresses and citizenship of officers and
directors on their short-form applications, but that applicants need not
identify which of the persons named in that application serve as the
applicant's officers and directors. Section 1.2112(b)(1)(i) states that,
in disclosing information required for a bidding credit, applicants must
"\[l\]ist the names, addresses, and citizenship of all officers,
directors, and other controlling interests of the applicant, as
described in §1.2110."[^12] When adopting Section 1.2112(b)(1)(i) and
the requirement that applicants claiming small business bidding credits
identify controlling interests, the Commission observed that
"application of the 'controlling interest' standard will ensure that
only those entities truly meriting small business status qualify for our
small business provisions."[^13] The rule's purpose in this regard
cannot be achieved absent meaningful disclosure of which persons serve
as the applicant's officers and directors. We reject Mobilfone's
strained construction of the section because allowing applicants to list
names without identifying information would deprive the Commission of
information necessary to conduct its controlling interest analysis.[^14]

The Commission's rules governing the short-form application process are
designed to identify qualified bidders from among the applicants to
participate in a timely manner prior to the auction. The burden of
providing information and demonstrating qualifications by the applicable
deadlines falls on the applicants, not the Commission.[^15] Where, as
here, routine enforcement of regular procedures provides applicants with
every opportunity to obtain the full benefits to which they are entitled
under the Commission's rules, the Commission's competitive bidding rules
and the public interest are best served by fair and consistent
enforcement of those rules and procedures, including applicable
deadlines. The public interest in a transparent auction process which
assures that applicants satisfy eligibility qualifications prior to the
auction could be substantially impaired if the Commission is required to
guess whether applicants qualify for bidding credits.

In the alternative, Mobilfone argues that it cannot be penalized for its
failure to comply with the disclosure requirement imposed by Section
1.2112(b)(1)(i). According to Mobilfone, the Paperwork Reduction
Act[^16] requires that, in order to enforce Section 1.2112(b)(1)(i), the
Commission must display a valid OMB document control number for the
information collection imposed by that section either in the rule or in
the Commission's list of OMB control numbers published in the Code of
Federal Regulations ("CFR").[^17]

The Commission displays an OMB control number pertaining to the
collection in the CFR. The Commission adopted the current Section
1.2112(b)(1)(i) as part of a broader revision of the Commission's Part 1
rules.[^18] The Commission gave public notice of, and sought comment on,
information collections related to these revisions in the *Part 1 Fifth
Report and Order.*[^19] In addition, the Commission sought comment on
those information collections, including the Section 1.2112(b)(1)(i)
collection regarding bidding credits, when seeking an extension of OMB's
prior approval of information collections required of auction
participants under OMB control number 3060-0767, Auction Forms and
License Transfer Disclosures.[^20] Once OMB approved the collections as
modified by the *Part 1 Fifth Report and Order*, the Commission
displayed the requisite OMB control number in Section 0.408 of the CFR's
Title 47.[^21] OMB rules provide that when a collection of information
is published in the CFR, such as the collection of information published
in Section 1.2112(b)(1)(i), placement of the control number in a table
or codified section of the Code adequately displays the number.[^22]
This is precisely what Section 0.408 of the Commission's rules
does.[^23] Notwithstanding Mobilfone's assertions to the contrary, the
Paperwork Reduction Act and OMB's implementing regulations do not
require a separate OMB control number for every rule section that
mandates an information collection.[^24]

For the foregoing reasons, Mobilfone's Petition is denied. This action
is taken under authority delegated pursuant to Section 0.331 of the
Commission's rules.[^25]

Sincerely,

Kathleen O'Brien Ham

Deputy Chief

Wireless Telecommunications Bureau

[^1]: In the Matter of Recission of Auction Bidding Credit for Mobilfone
    Service, Inc. -- Auction No. 40; Petition for Reconsideration and
    Request for Reinstatement of 25% Bidding Credit (filed November 15,
    2001) ("Petition"). Contrary to the implication of the Petition's
    caption, Mobilfone never received a bidding credit in connection
    with Auction No. 40. *See* Letter to Timothy E. Welch from Kathryn
    Garland, October 17, 2001, attached to Petition.

[^2]: Lower and Upper Paging Bands Auction Scheduled for October 30,
    2001, DA 01-1961, *Public Notice*, 16 FCC Rcd 15,430 (2001).

[^3]: 47 C.F.R. §1.2112(b)(1)(i) and (iii); *see* Wireless
    Telecommunications Bureau Staff Provides Guidance on Completing the
    Short-Form Application (FCC Form 175) for Auction No. 40, Auction of
    Licenses for Lower and Upper Paging Bands, DA 01-2122, *Public
    Notice*, 16 FCC Rcd 16,391, 16,393-94 (2001) ("all applicants
    seeking bidding credits must list 'the names, addresses, and
    citizenship of **all** officers, directors, and other controlling
    interests\[.\]' . . . To avoid any uncertainty, applicants should
    state that their application provides a complete list of relevant
    parties.") (emphasis in original; citation omitted).

[^4]: 47 C.F.R. §1.2105(b)(2).

[^5]: *See* Auction of Licenses for Lower and Upper Paging Bands, DA
    01-2262, *Public Notice*, 16 FCC Rcd 17,185 (2001) ("*Auction No. 40
    Status Public Notice*").

[^6]: *Auction No. 40 Status Public Notice*, 16 FCC Rcd at 17,204.

[^7]: Petition at 1-2. As indicated in the Petition, Mobilfone's initial
    September 16, 2001 short-form application further stated that Mark
    E. Staley serves as Mobilfone's President/Director and Paul C.
    Staley serves as Mobilfone's Vice-President/Director. This statement
    was deleted when Mobilfone resubmitted its short-form application on
    October 4, 2001. Mobilfone's resubmitted short-form application
    separately gave Mark E. Staley's title as President and did not
    identify any party as a director.

[^8]: *See* Letter to Timothy E. Welch from Kathryn Garland, October 17,
    2001, attached to Petition.

[^9]: Auction No. 40 commenced on October 30, 2001.

[^10]: 47 C.F.R. §1.2105(b)(2).

[^11]: *See* Two Way Radio of Carolina, Inc., *Memorandum Opinion and
    Order*, 14 FCC Rcd 12,035, 12,039 ¶8 (1999)("modification of an
    applicant's small business status \[*i.e.*, bidding credit
    eligibility\] does not constitute a minor change under our
    competitive bidding rules").

[^12]: 47 C.F.R. §1.2112(b)(1)(i).

[^13]: Amendment of Part 1 of the Commission's Rules -- Competitive
    Bidding Procedures, WT Docket No. 97-82, *Order on Reconsideration
    of the Third Report and Order, Fifth Report and Order and Fourth
    Further Notice of Proposed Rule Making*, 15 FCC Rcd 15,293, 15,323,
    ¶59 (2000) ("*Part 1 Fifth Report and Order*"). *See id.* at 15,324,
    ¶62 (applicant has disclosure obligation).

[^14]: Mobilfone's resubmitted short-form application identified only
    one of its officers and none of its directors, leaving the
    Commission to guess the identities of the directors and other
    officers, as well as their attributable gross revenues.

[^15]: *See* *id.* at 15,324, ¶62 (applicant has disclosure obligation);
    *see also* 47 U.S.C. §309(j)(5)(participation in auctions prohibited
    "unless such bidder submits such information and assurances as the
    Commission may require").

[^16]: 44 U.S.C. § 3501, *et seq.*

[^17]: *See* 47 C.F.R. §0.408.

[^18]: *See generally Part 1 Fifth Report and Order*.

[^19]: *Id.* at 15,335; ¶92; 65 Fed.Reg. 52,323, 52,335-36.

[^20]: *See* Notice of Public Information Collection(s) Being Reviewed
    by the Federal Communications Commission, 65 Fed.Reg. 67,744, 67,745
    (2000) ("The information is used to ensure that applicants are
    qualified to participate in Commission auctions and to ensure that
    license winners are entitled to receive small business
    preferences.") In addition, the Commission submitted the *Part 1
    Fifth Report and Order* information collections to OMB when seeking
    an extension of OMB's approval of the information collections in FCC
    Form 175. *See* *id.*, 65 Fed.Reg. at 67,745. The instructions for
    FCC Form 175 tell applicants to "list in an exhibit the specific
    ownership information as set forth in 47 C.F.R. §1.2112." Form 175,
    October 2000, at 4 (available at
    <http://www.fcc.gov/formpage.html>.) OMB approved the requested
    extension and the Commission displayed the OMB control number for
    FCC Form 175. *See* 47 C.F.R. §0.408 (OMB Control No. 3060-0600).
    Consequently, although the information is collected in an exhibit
    rather than in the form itself, OMB approved the information
    collection in Section 1.2112(b)(1)(i) when it approved the
    information collections in FCC Form 175, as well as when it approved
    the information collection directly, as described above.

[^21]: 47 C.F.R. §0.408. Given that the Commission complied with the
    Paperwork Reduction Act, we need not consider Mobilfone's assertions
    regarding the consequences of non-compliance.

[^22]: 5 C.F.R. § 1320.3(f)(3).

[^23]: *See* AirTouch Paging Inc., *Order*, DA 99-1175, ¶8 (rel. June
    16, 1999).

[^24]: *Id.*

[^25]: 47 C.F.R. §0.331.