Title 47—Telecommunication--Volume 1
PART 1—PRACTICE AND PROCEDURE
§ 1.10009   What are the steps for electronic filing?
(a) Step 1: Register for an FCC Registration Number (FRN). (See subpart W, §§ 1.8001 through 1.8004.)
(1) If you already have an FRN, go to Step 2.
(2) In order to process your electronic application, you must have an FRN. You may obtain an FRN either directly from the Commission Registration System (CORES) at https://www.fcc.gov/licensing-databases/online-filing, or through ICFS as part of your filing process. If you need to know more about who needs an FRN, visit CORES at https://www.fcc.gov/licensing-databases/online-filing.
(3) If you are a(n):
(i) Applicant,
(ii) Transferee and assignee,
(iii) Transferor and assignor,
(iv) Licensee/Authorization Holder, or
(v) Payer, you are required to have and use an FRN when filing applications and/or paying fees through ICFS.
(4) We use your FRN to give you secured access to ICFS and to pre-fill the application you file.
(b) Step 2: Register with ICFS. (1) If you are already registered with ICFS, go to Step 3.
(2) In order to complete and file your electronic application, you must register in ICFS, located at https://www.fcc.gov/icfs.
(3) You can register your account in:
(i) Your name,
(ii) Your company's name, or
(iii) Your client's name.
(4) ICFS will issue you an account number as part of the registration process. You will create your own password.
(5) If you forget your password, send an email to the ICFS helpline at icfsinfo@fcc.gov or contact the helpline at (202) 418-2222 for assistance.
(c) Step 3: Log into ICFS, select the application you want to file, provide the required FRN(s) and password(s) and fill out your application. You must completely fill out forms and provide all requested information as provided in parts 1, 25, 63, and 64 of this chapter.
(1) You must provide an address where you can receive mail delivery by the United States Postal Service. You are also encouraged to provide an e-mail address. This information is used to contact you regarding your application and to request additional documentation, if necessary.
(2) Reference to material on file. You must answer questions on application forms that call for specific technical data, or that require yes or no answers or other short answers. However, if documents or other lengthy showings are already on file with us and contain the required information, you may incorporate the information by reference, as long as:
(i) The referenced information is filed in ICFS.
(ii) The referenced information is current and accurate in all material respects; and
(iii) The application states where we can find the referenced information as well as:
(A) The application file number, if the reference is to previously-filed applications
(B) The title of the proceeding, the docket number, and any legal citation, if the reference is to a docketed proceeding.
(d) Step 4: File your application. If you file your application successfully through ICFS, a confirmation screen will appear showing you the date and time of your filing and your submission ID. Print this verification for your records as proof of online filing.
(e) Step 5: Pay for your application. (1) Most applications require that you pay a fee to us before we can begin processing your application. You can determine the amount of your fee in three ways:
(i) You can refer to § 1.1107,
(ii) You can refer to the International and Satellite Services fee guide located at http://www.fcc.gov/fees/appfees.html, or
(iii) You can run a draft electronic submission of payment online form through ICFS, in association with a filed application, and the system will automatically enter your required fee on the form.
(2)(i) A complete FCC electronic submission of payment online form must accompany all fee payments. You must provide the FRN for both the applicant and the payer. You also must include your submission ID number on the electronic submission of payment online form in the box labeled “FCC Code 2.” In addition, for applications for transfer of control or assignment of license, call signs involved in the transaction must be entered into the “FCC Code 1” box on the FCC electronic submission of payment online form. (This may require the use of multiple rows on the electronic submission of payment online form for a single application where more than one call sign is involved.)
(ii) You can generate a pre-filled FCC electronic submission of payment online form from ICFS using your IB submission ID. For specific instructions on using ICFS to generate your FCC electronic submission of payment online form, go to the ICFS website ( http://licensing.fcc.gov/icfs ) and click on the “Getting Started” button.
(3) You have 3 payment options:
(i) Pay by credit card (through ICFS);
(ii) Pay by online Automatic Clearing House (ACH) payment; or
(iii) Pay by wire transfer or other electronic payments.
(4) You must electronically submit payment o within fourteen (14) calendar days of the date that you file your application in ICFS. If not, we will dismiss your application.
(5) For more information on fee payments, refer to Payment Instructions found on the ICFS internet site at http://licensing.fcc.gov/icfs, under the Using ICFS link.
§ 1.10010   Do I need to send paper copies with my electronic applications?
When you file electronically through ICFS, the electronic record is the official record. You do not need to submit paper copies of your application.
§ 1.10011   Who may sign applications?
(a) The Commission only accepts electronic applications. An electronic application is “signed” when there is an electronic signature. An electronic signature is the typed name of the person “signing” the application, which is then electronically transmitted via ICFS.
(b) For all electronically filed applications, you (or the signor) must actually sign a paper copy of the application, and keep the signed original in your files for future reference.
(c) You only need to sign the original of applications, amendments, and related statements of fact.
(d) Sign applications, amendments, and related statements of fact as follows:
(1) By you, if you are an individual;
(2) By one of the partners, if you are a partnership;
(3) By an officer, director, or duly authorized employee, if you are a corporation; or
(4) By a member who is an officer, if you are an unauthorized association.
(e) If you file applications, amendments, and related statements of fact on behalf of eligible government entities, an elected or appointed official who may sign under the laws of the applicable jurisdiction must sign the document. Eligible government entities are:
(1) States and territories of the United States,
(2) Political subdivisions of these states and territories,
(3) The District of Columbia, and
(4) Units of local government.
(f) If you are either physically disabled or absent from the United States, your attorney may sign applications, amendments and related statements of facts on your behalf.
(1) Your attorney must explain why you are not signing the documents.
(2) If your attorney states any matter based solely on his belief (rather than knowledge), your attorney must explain his reasons for believing that such statements are true.
(g) It is unnecessary to sign applications, amendments, and related statements of fact under oath. However, willful false statements are punishable by a fine and imprisonment, 18 U.S.C. 1001, and by administrative sanctions.
§ 1.10012   When can I file on ICFS?
ICFS is available 24 hours a day, seven (7) days a week for filing.
§ 1.10013   How do I check the status of my application after I file it?
You can check the status of your application through the “Search Tools” on the ICFS homepage. The ICFS homepage is located at https://www.fcc.gov/icfs.
§ 1.10014   What happens after officially filing my application?
(a) We give you an ICFS file number.
(b) We electronically route your application to an analyst who conducts an initial review of your application. If your application is incomplete, we will either dismiss the application, or contact you by telephone, letter or email to ask for additional information within a specific time. In cases where we ask for additional information, if we do not receive it within the specified time, we will dismiss your application. In either case, we will dismiss your application without prejudice, so that you may file again with a complete application.
(c) If your application is complete, and we verify receipt of your payment, it will appear on an “Accepted for Filing” Public Notice, unless public notice is not required. An “Accepted for Filing” Public Notice gives the public a certain amount of time to comment on your filing. This period varies depending upon the type of application.
(1) Certain applications do not have to go on an “Accepted for Filing” Public Notice prior to initiation of service, but instead are filed as notifications to the Commission of prior actions by the carriers as authorized by the rules. Examples include pro forma notifications of transfer of control and assignment and certain foreign carrier notifications.
(2) Each “Accepted for Filing” Public Notice has a report number. Examples of various types of applications and their corresponding report number (the “x” represents a sequential number) follow.
(d) After the Public Notice, your application may undergo legal, technical and/or financial review as deemed necessary. In addition, some applications require coordination with other government agencies.
(e) After review, we decide whether to grant or deny applications or whether to take other necessary action. Grants, denials and any other necessary actions are noted in the ICFS database. Some filings may not require any affirmative action, such as some Foreign Carrier Affiliation Notification Filings. Other filings, such as some International Section 214 Applications, International Accounting Rate Change Filings and Requests for assignment of Data Network Identification Codes, may be granted automatically on a specific date unless the applicant is notified otherwise prior to that date, as specified in the rules.
(f) We list most actions taken on public notices. Each “Action Taken” Public Notice has a report number. Examples of various types of applications and their corresponding report number (the “x” represents a sequential number) follow.
(g) Other actions are taken by formal written Order, oral actions that are followed up with a written document, or grant stamp of the application. In all cases, the action dates are available online through the ICFS system.
(h) Issuing and Mailing Licenses for Granted Applications. Not all applications handled through ICFS and granted by the Commission result in the issuance of a paper license or authorization. A list of application types and their corresponding authorizations follows.
§ 1.10015   Are there exceptions for emergency filings?
(a) Sometimes we grant licenses, modifications or renewals even if no one files an application. Instances where this may occur include:
(1) If we find there is an emergency involving danger to life or property, or because equipment is damaged;
(2) If the President proclaims, or if Congress declares, a national emergency;
(3) During any war in which the United States is engaged and when grants, modifications or renewals are necessary for national defense, security or in furtherance of the war effort; or
(4) If there is an emergency where we find that it is not feasible to secure renewal applications from existing licensees or to follow normal licensing procedures.
(b) Emergency authorizations stop at the end of emergency periods or wars. After the emergency period or war, you must submit your request by filing the appropriate form electronically.
(c) The procedures for emergency requests, as described in this section, are as specified in §§ 25.120 and 63.25 of this chapter.
§ 1.10016   How do I apply for special temporary authority?
(a) Requests for Special Temporary Authority (STA) may be filed via ICFS for most services. We encourage you to file STA applications through ICFS as it will ensure faster receipt of your request.
(b) For specific information on the content of your request, refer to §§ 25.120 and 63.25 of this chapter.
§ 1.10017   How can I submit additional information?
In response to an official request for information from the Space Bureau and Office of International Affairs, you can submit additional information electronically directly to the requestor, or by mail to the Office of the Secretary, Attention: Space Bureau, or Office of International Affairs, as appropriate.
§ 1.10018   May I amend my application?
(a) If the service rules allow, you may amend pending applications.
(b) If an electronic version of an amendment application is available in ICFS, you may file your amendment electronically through ICFS.
§ 1.20000   Purpose.
Pursuant to the Communications Assistance for Law Enforcement Act (CALEA), Public Law 103-414, 108 Stat. 4279 (1994) (codified as amended in sections of 18 U.S.C. and 47 U.S.C.), this subpart contains rules that require a telecommunications carrier to:
(a) Ensure that any interception of communications or access to call-identifying information effected within its switching premises can be activated only in accordance with appropriate legal authorization, appropriate carrier authorization, and with the affirmative intervention of an individual officer or employee of the carrier acting in accordance with regulations prescribed by the Commission; and
(b) Implement the assistance capability requirements of CALEA section 103, 47 U.S.C. 1002, to ensure law enforcement access to authorized wire and electronic communications or call-identifying information.
§ 1.20001   Scope.
The definitions included in 47 CFR 1.20002 shall be used solely for the purpose of implementing CALEA requirements.
§ 1.20002   Definitions.
For purposes of this subpart:
(a) Appropriate legal authorization. The term appropriate legal authorization means:
(1) A court order signed by a judge or magistrate authorizing or approving interception of wire or electronic communications; or
(2) Other authorization, pursuant to 18 U.S.C. 2518(7), or any other relevant federal or state statute.
(b) Appropriate carrier authorization. The term appropriate carrier authorization means the policies and procedures adopted by telecommunications carriers to supervise and control officers and employees authorized to assist law enforcement in conducting any interception of communications or access to call-identifying information.
(c) Appropriate authorization. The term appropriate authorization means both appropriate legal authorization and appropriate carrier authorization.
(d) LEA. The term LEA means law enforcement agency; e.g., the Federal Bureau of Investigation or a local police department.
(e) Telecommunications carrier. The term telecommunications carrier includes:
(1) A person or entity engaged in the transmission or switching of wire or electronic communications as a common carrier for hire;
(2) A person or entity engaged in providing commercial mobile service (as defined in sec. 332(d) of the Communications Act of 1934 (47 U.S.C. 332(d))); or
(3) A person or entity that the Commission has found is engaged in providing wire or electronic communication switching or transmission service such that the service is a replacement for a substantial portion of the local telephone exchange service and that it is in the public interest to deem such a person or entity to be a telecommunications carrier for purposes of CALEA.
§ 1.20003   Policies and procedures for employee supervision and control.
A telecommunications carrier shall:
(a) Appoint a senior officer or employee responsible for ensuring that any interception of communications or access to call-identifying information effected within its switching premises can be activated only in accordance with a court order or other lawful authorization and with the affirmative intervention of an individual officer or employee of the carrier.
(b) Establish policies and procedures to implement paragraph (a) of this section, to include:
(1) A statement that carrier personnel must receive appropriate legal authorization and appropriate carrier authorization before enabling law enforcement officials and carrier personnel to implement the interception of communications or access to call-identifying information;
(2) An interpretation of the phrase “appropriate authorization” that encompasses the definitions of appropriate legal authorization and appropriate carrier authorization, as used in paragraph (b)(1) of this section;
(3) A detailed description of how long it will maintain its records of each interception of communications or access to call-identifying information pursuant to § 1.20004;
(4) In a separate appendix to the policies and procedures document:
(i) The name and a description of the job function of the senior officer or employee appointed pursuant to paragraph (a) of this section; and
(ii) Information necessary for law enforcement agencies to contact the senior officer or employee appointed pursuant to paragraph (a) of this section or other CALEA points of contact on a seven days a week, 24 hours a day basis.
(c) Report to the affected law enforcement agencies, within a reasonable time upon discovery:
(1) Any act of compromise of a lawful interception of communications or access to call-identifying information to unauthorized persons or entities; and
(2) Any act of unlawful electronic surveillance that occurred on its premises.
§ 1.20004   Maintaining secure and accurate records.
(a) A telecommunications carrier shall maintain a secure and accurate record of each interception of communications or access to call-identifying information, made with or without appropriate authorization, in the form of single certification.
(1) This certification must include, at a minimum, the following information:
(i) The telephone number(s) and/or circuit identification numbers involved;
(ii) The start date and time that the carrier enables the interception of communications or access to call identifying information;
(iii) The identity of the law enforcement officer presenting the authorization;
(iv) The name of the person signing the appropriate legal authorization;
(v) The type of interception of communications or access to call-identifying information (e.g., pen register, trap and trace, Title III, FISA); and
(vi) The name of the telecommunications carriers' personnel who is responsible for overseeing the interception of communication or access to call-identifying information and who is acting in accordance with the carriers' policies established under § 1.20003.
(2) This certification must be signed by the individual who is responsible for overseeing the interception of communications or access to call-identifying information and who is acting in accordance with the telecommunications carrier's policies established under § 1.20003. This individual will, by his/her signature, certify that the record is complete and accurate.
(3) This certification must be compiled either contemporaneously with, or within a reasonable period of time after the initiation of the interception of the communications or access to call-identifying information.
(4) A telecommunications carrier may satisfy the obligations of paragraph (a) of this section by requiring the individual who is responsible for overseeing the interception of communication or access to call-identifying information and who is acting in accordance with the carriers' policies established under § 1.20003 to sign the certification and append the appropriate legal authorization and any extensions that have been granted. This form of certification must at a minimum include all of the information listed in paragraph (a) of this section.
(b) A telecommunications carrier shall maintain the secure and accurate records set forth in paragraph (a) of this section for a reasonable period of time as determined by the carrier.
(c) It is the telecommunications carrier's responsibility to ensure its records are complete and accurate.
(d) Violation of this rule is subject to the penalties of § 1.20008.
§ 1.20005   Submission of policies and procedures and Commission review.
(a) Each telecommunications carrier shall file with the Commission the policies and procedures it uses to comply with the requirements of this subpart. These policies and procedures shall be filed before commencing service and, thereafter, within 90 days of a carrier's merger or divestiture or a carrier's amendment of its existing policies and procedures.
(b) The Commission shall review each telecommunications carrier's policies and procedures to determine whether they comply with the requirements of §§ 1.20003 and 1.20004.
(1) If, upon review, the Commission determines that a telecommunications carrier's policies and procedures do not comply with the requirements established under §§ 1.20003 and 1.20004, the telecommunications carrier shall modify its policies and procedures in accordance with an order released by the Commission.
(2) The Commission shall review and order modification of a telecommunications carrier's policies and procedures as may be necessary to insure compliance by telecommunications carriers with the requirements of the regulations prescribed under §§ 1.20003 and 1.20004.
(c) As of June 29, 2023, any filings required by paragraph (a) of this section shall be submitted electronically through the Commission's CALEA Electronic Filing System (CEFS).
§ 1.20006   Assistance capability requirements.
(a) Telecommunications carriers shall provide to a Law Enforcement Agency the assistance capability requirements of CALEA regarding wire and electronic communications and call-identifying information, see 47 U.S.C. 1002. A carrier may satisfy these requirements by complying with publicly available technical requirements or standards adopted by an industry association or standard-setting organization, such as J-STD-025 (current version), or by the Commission.
(b) Telecommunications carriers shall consult, as necessary, in a timely fashion with manufacturers of its telecommunications transmission and switching equipment and its providers of telecommunications support services for the purpose of ensuring that current and planned equipment, facilities, and services comply with the assistance capability requirements of 47 U.S.C. 1002.
(c) A manufacturer of telecommunications transmission or switching equipment and a provider of telecommunications support service shall, on a reasonably timely basis and at a reasonable charge, make available to the telecommunications carriers using its equipment, facilities, or services such features or modifications as are necessary to permit such carriers to comply with the assistance capability requirements of 47 U.S.C. 1002.
§ 1.20007   Additional assistance capability requirements for wireline, cellular, and PCS telecommunications carriers.
(a) Definition —(1) Call-identifying information. Call identifying information means dialing or signaling information that identifies the origin, direction, destination, or termination of each communication generated or received by a subscriber by means of any equipment, facility, or service of a telecommunications carrier. Call-identifying information is “reasonably available” to a carrier if it is present at an intercept access point and can be made available without the carrier being unduly burdened with network modifications.
(2) Collection function. The location where lawfully authorized intercepted communications and call-identifying information is collected by a law enforcement agency (LEA).
(3) Content of subject-initiated conference calls. Capability that permits a LEA to monitor the content of conversations by all parties connected via a conference call when the facilities under surveillance maintain a circuit connection to the call.
(4) Destination. A party or place to which a call is being made (e.g., the called party).
(5) Dialed digit extraction. Capability that permits a LEA to receive on the call data channel digits dialed by a subject after a call is connected to another carrier's service for processing and routing.
(6) Direction. A party or place to which a call is re-directed or the party or place from which it came, either incoming or outgoing (e.g., a redirected-to party or redirected-from party).
(7) IAP. Intercept access point is a point within a carrier's system where some of the communications or call-identifying information of an intercept subject's equipment, facilities, and services are accessed.
(8) In-band and out-of-band signaling. Capability that permits a LEA to be informed when a network message that provides call identifying information (e.g., ringing, busy, call waiting signal, message light) is generated or sent by the IAP switch to a subject using the facilities under surveillance. Excludes signals generated by customer premises equipment when no network signal is generated.
(9) J-STD-025. The standard, including the latest version, developed by the Telecommunications Industry Association (TIA) and the Alliance for Telecommunications Industry Solutions (ATIS) for wireline, cellular, and broadband PCS carriers. This standard defines services and features to support lawfully authorized electronic surveillance, and specifies interfaces necessary to deliver intercepted communications and call-identifying information to a LEA. Subsequently, TIA and ATIS published J-STD-025-A and J-STD-025-B.
(10) Origin. A party initiating a call (e.g., a calling party), or a place from which a call is initiated.
(11) Party hold, join, drop on conference calls. Capability that permits a LEA to identify the parties to a conference call conversation at all times.
(12) Subject-initiated dialing and signaling information. Capability that permits a LEA to be informed when a subject using the facilities under surveillance uses services that provide call identifying information, such as call forwarding, call waiting, call hold, and three-way calling. Excludes signals generated by customer premises equipment when no network signal is generated.
(13) Termination. A party or place at the end of a communication path (e.g. the called or call-receiving party, or the switch of a party that has placed another party on hold).
(14) Timing information. Capability that permits a LEA to associate call-identifying information with the content of a call. A call-identifying message must be sent from the carrier's IAP to the LEA's Collection Function within eight seconds of receipt of that message by the IAP at least 95% of the time, and with the call event time-stamped to an accuracy of at least 200 milliseconds.
(b) In addition to the requirements in § 1.20006, wireline, cellular, and PCS telecommunications carriers shall provide to a LEA the assistance capability requirements regarding wire and electronic communications and call identifying information covered by J-STD-025 (current version), and, subject to the definitions in this section, may satisfy these requirements by complying with J-STD-025 (current version), or by another means of their own choosing. These carriers also shall provide to a LEA the following capabilities:
(1) Content of subject-initiated conference calls;
(2) Party hold, join, drop on conference calls;
(3) Subject-initiated dialing and signaling information;
(4) In-band and out-of-band signaling;
(5) Timing information;
(6) Dialed digit extraction, with a toggle feature that can activate/deactivate this capability.
§ 1.20008   Penalties.
In the event of a telecommunications carrier's violation of this subchapter, the Commission shall enforce the penalties articulated in 47 U.S.C. 503(b) of the Communications Act of 1934 and 47 CFR 1.80.
§ 1.21000   Purpose.
This subpart sets forth procedures for competitive bidding to determine the recipients of universal service support pursuant to part 54 of this chapter and the amount(s) of support that each recipient respectively may receive, subject to post-auction procedures, when the Commission directs that such support shall be determined through competitive bidding.
§ 1.21001   Participation in competitive bidding for support.
(a) Public Notice of the Application Process. The dates and procedures for submitting applications to participate in competitive bidding pursuant to this subpart shall be announced by public notice.
(b) Application contents. Unless otherwise established by public notice, an applicant to participate in competitive bidding pursuant to this subpart shall provide the following information in an acceptable form:
(1) The identity of the applicant, i.e., the party that seeks support, and the ownership information as set forth in § 1.2112(a);
(2) The identities of up to three individuals authorized to make or withdraw a bid on behalf of the applicant. No person may serve as an authorized bidder for more than one auction applicant;
(3) The identities of all real parties in interest to, and a brief description of, any agreements relating to the participation of the applicant in the competitive bidding;
(4) Certification that the applicant has provided in its application a brief description of, and identified each party to, any partnerships, joint ventures, consortia or other agreements, arrangements or understandings of any kind relating to the applicant's participation in the competitive bidding and the support being sought, including any agreements that address or communicate directly or indirectly bids (including specific prices), bidding strategies (including the specific areas on which to bid or not to bid), or the post-auction market structure, to which the applicant, or any party that controls as defined in paragraph (d)(1) of this section or is controlled by the applicant, is a party;
(5) Certification that the applicant (or any party that controls as defined in paragraph (d)(1) of this section or is controlled by the applicant) has not entered and will not enter into any partnerships, joint ventures, consortia or other agreements, arrangements, or understandings of any kind relating to the support to be sought that address or communicate, directly or indirectly, bidding at auction (including specific prices to be bid) or bidding strategies (including the specific areas on which to bid or not to bid for support), or post-auction market structure with any other applicant (or any party that controls or is controlled by another applicant);
(6) Certification that if the applicant has ownership or other interest disclosed pursuant to paragraph (b)(1) of this section with respect to more than one application in a given auction, it will implement internal controls that preclude any individual acting on behalf of the applicant as defined in § 1.21002(a) from possessing information about the bids or bidding strategies (including post-auction market structure), of more than one party submitting an application for the auction or communicating such information with respect to a party submitting an application for the auction to anyone possessing such information regarding another party submitting an application for the auction;
(7) Certification that the applicant has sole responsibility for investigating and evaluating all technical and marketplace factors that may have a bearing on the level of support it submits as a bid, and that if the applicant wins support, it will be able to build and operate facilities in accordance with the obligations applicable to the type of support it wins and the Commission's rules generally;
(8) Certification that the applicant and all applicable parties have complied with and will continue to comply with § 1.21002;
(9) Certification that the applicant is in compliance with all statutory and regulatory requirements for receiving the universal service support that the applicant seeks, or, if expressly allowed by the rules specific to a high-cost support mechanism, a certification that the applicant acknowledges that it must be in compliance with such requirements before being authorized to receive support;
(10) Certification that the applicant will be subject to a default payment or a forfeiture in the event of an auction default and that the applicant will make any payment that may be required pursuant to § 1.21004;
(11) Certification that the applicant is not delinquent on any debt owed to the Commission and that it is not delinquent on any non-tax debt owed to any Federal agency as of the deadline for submitting applications to participate in competitive bidding pursuant to this subpart, or that it will cure any such delinquency prior to the end of the application resubmission period established by public notice.
(12) Certification that the individual submitting the application is authorized to do so on behalf of the applicant; and
(13) Such additional information as may be required.
(c) Limit on filing applications. In any auction, no individual or entity may file more than one application to participate in competitive bidding or have a controlling interest (as defined in paragraph (d)(1) of this section) in more than one application to participate in competitive bidding. In the case of a consortium, each member of the consortium shall be considered to have a controlling interest in the consortium. In the event that applications for an auction are filed by applicants with overlapping controlling interests, pursuant to paragraph (f)(3) of this section, both applications will be deemed incomplete and only one such applicant may be deemed qualified to bid.
(d) Definitions. For purposes of the certifications required under paragraph (b) of this section and the limit on filing applications in paragraph (c) of this section:
(1) The term controlling interest includes individuals or entities with positive or negative de jure or de facto control of the applicant. De jure control includes holding 50 percent or more of the voting stock of a corporation or holding a general partnership interest in a partnership. Ownership interests that are held indirectly by any party through one or more intervening corporations may be determined by successive multiplication of the ownership percentages for each link in the vertical ownership chain and application of the relevant attribution benchmark to the resulting product, except that if the ownership percentage for an interest in any link in the chain meets or exceeds 50 percent or represents actual control, it may be treated as if it were a 100 percent interest. De facto control is determined on a case-by-case basis. Examples of de facto control include constituting or appointing 50 percent or more of the board of directors or management committee; having authority to appoint, promote, demote, and fire senior executives that control the day-to-day activities of the support recipient; or playing an integral role in management decisions. In the case of a consortium, each member of the consortium shall be considered to have a controlling interest in the consortium.
(2) The term consortium means an entity formed to apply as a single applicant to bid at auction pursuant to an agreement by two or more separate and distinct legal entities.
(3) The term joint venture means a legally cognizable entity formed to apply as a single applicant to bid at auction pursuant to an agreement by two or more separate and distinct legal entities.
(e) Financial Requirements for Participation. As a prerequisite to participating in competitive bidding, an applicant may be required to post a bond or place funds on deposit with the Commission in an amount based on the default payment or forfeiture that may be required pursuant to § 1.21004. The details of and deadline for posting such a bond or making such a deposit will be announced by public notice. No interest will be paid on any funds placed on deposit.
(f) Application Processing. (1) Any timely submitted application will be reviewed by Commission staff for completeness and compliance with the Commission's rules. No untimely applications will be reviewed or considered.
(2) Any application to participate in competitive bidding that does not identify the applicant or does not include all of the certifications required pursuant to this section is unacceptable for filing and cannot be corrected subsequent to the applicable deadline for submitting applications. The application will be deemed incomplete and the applicant will not be found qualified to bid.
(3) If an individual or entity submits multiple applications in a single auction, or if entities that are commonly controlled by the same individual or same set of individuals submit more than one application in a single auction, then at most only one of such applications may be deemed complete, and the other such application(s) will be deemed incomplete, and such applicants will not be found qualified to bid.
(4) An applicant will not be permitted to participate in competitive bidding if the applicant has not provided any bond or deposit of funds required pursuant to paragraph (e) of this section, as of the applicable deadline.
(5) The Commission will provide applicants a limited opportunity to cure defects (except for failure to sign the application and to make all required certifications) during a resubmission period established by public notice and to resubmit a corrected application. During the resubmission period for curing defects, an application may be amended or modified to cure defects identified by the Commission or to make minor amendments or modifications. After the resubmission period has ended, an application may be amended or modified to make minor changes or correct minor errors in the application. An applicant may not make major modifications to its application after the initial filing deadline. An applicant will not be permitted to participate in competitive bidding if Commission staff determines that the application requires major modifications to be made after that deadline. Major modifications include, but are not limited to, any changes in the ownership of the applicant that constitute an assignment or transfer of control, or any changes in the identity of the applicant, or any changes in the required certifications. Minor amendments include, but are not limited to, the correction of typographical errors and other minor defects not identified as major. Minor modifications may be subject to a deadline established by public notice. An application will be considered to be newly filed if it is amended by a major amendment and may not be resubmitted after applicable filing deadlines.
(6) An applicant that fails to cure the defects in their applications in a timely manner during the resubmission period as specified by public notice will have its application dismissed with no further opportunity for resubmission.
(7) An applicant that is found qualified to participate in competitive bidding shall be identified in a public notice.
(8) Applicants shall have a continuing obligation to make any amendments or modifications that are necessary to maintain the accuracy and completeness of information furnished in pending applications. Such amendments or modifications shall be made as promptly as possible, and in no case more than five business days after applicants become aware of the need to make any amendment or modification, or five business days after the reportable event occurs, whichever is later. An applicant's obligation to make such amendments or modifications to a pending application continues until they are made.
§ 1.21002   Prohibition of certain communications during the competitive bidding process.
(a) Definitions. For purposes of this section:
(1) The term “applicant” shall include all controlling interests in the entity submitting an application to participate in a given auction, as well as all holders of partnership and other ownership interests and any stock interest amounting to 10 percent or more of the entity, or outstanding stock, or outstanding voting stock of the entity submitting the application, and all officers and directors of that entity. In the case of a consortium, each member of the consortium shall be considered to have a controlling interest in the consortium; and
(2) The term bids or bidding strategies shall include capital calls or requests for additional funds in support of bids or bidding strategies.
(b) Certain communications prohibited. After the deadline for submitting applications to participate, an applicant is prohibited from cooperating or collaborating with any other applicant with respect to its own, or one another's, or any other competing applicant's bids or bidding strategies, and is prohibited from communicating with any other applicant in any manner the substance of its own, or one another's, or any other competing applicant's bids or bidding strategies, until after the post-auction deadline for winning bidders to submit applications for support.
(1) Example 1. Company A is an applicant in area 1. Company B and Company C each own 10 percent of Company A. Company D is an applicant in area 1, area 2, and area 3. Company C is an applicant in area 3. Without violating the Commission's Rules, Company B can enter into a consortium arrangement with Company D or acquire an ownership interest in Company D if Company B certifies either:
(i) That it has communicated with and will communicate neither with Company A or anyone else concerning Company A's bids or bidding strategy, nor with Company C or anyone else concerning Company C's bids or bidding strategy, or
(ii) That it has not communicated with and will not communicate with Company D or anyone else concerning Company D's bids or bidding strategy.
(2) [Reserved]
(c) Internal controls required. Any party submitting an application for a given auction that has an ownership or other interest disclosed with respect to more than one application for an auction must implement internal controls that preclude any individual acting on behalf of the applicant as defined in paragraph (a)(1) of this section from possessing information about the bids or bidding strategies as defined in paragraph (a)(2) of this section of more than one party submitting an application for the auction or communicating such information with respect to a party submitting an application for the auction to anyone possessing such information regarding another party submitting an application for the auction. Implementation of such internal controls will not outweigh specific evidence that a prohibited communication has occurred, nor will it preclude the initiation of an investigation when warranted.
(d) Modification of application required. An applicant must modify its application for an auction to reflect any changes in ownership or in membership of a consortium or a joint venture or agreements or understandings related to the support being sought.
(e) Duty to report potentially prohibited communications. An applicant that makes or receives communications that may be prohibited pursuant to paragraph (b) of this section shall report such communications to the Commission staff immediately, and in any case no later than 5 business days after the communication occurs. An applicant's obligation to make such a report continues until the report has been made.
(f) Procedures for reporting potentially prohibited communications. Any report required to be filed pursuant to this section shall be filed as directed in public notices detailing procedures for the bidding that was the subject of the reported communication. If no such public notice provides direction, the party making the report shall do so in writing to the Chief of the Auctions Division, Office of Economics and Analytics, by the most expeditious means available, including electronic transmission such as email.
§ 1.21003   Competitive bidding process.
(a) Public Notice of Competitive Bidding Procedures. Detailed competitive bidding procedures shall be established by public notice prior to the commencement of competitive bidding any time competitive bidding is conducted pursuant to this subpart.
(b) Competitive Bidding Procedures—Design Options. The public notice detailing competitive bidding procedures may establish the design of the competitive bidding utilizing any of the following options, without limitation:
(1) Procedures for Collecting Bids. (i) Procedures for collecting bids in a single round or in multiple rounds.
(ii) Procedures for collecting bids on an item-by-item basis, or using various aggregation specifications.
(iii) Procedures for collecting bids that specify contingencies linking bids on the same item and/or for multiple items.
(iv) Procedures allowing for bids that specify a support level, indicate demand at a specified support level, or provide other information as specified by the Commission.
(v) Procedures to collect bids in one or more stage or stages, including for transitions between stages.
(2) Procedures for Assigning Winning Bids. (i) Procedures for scoring bids by factors in addition to bid amount, such as population coverage or geographic contour, or other relevant measurable factors.
(ii) Procedures to incorporate public interest considerations into the process for assigning winning bids.
(3) Procedures for Determining Payments. (i) Procedures to determine the amount of any support for which winning bidders may become authorized, consistent with other auction design choices.
(ii) Procedures that provide for support amounts based on the amount as bid or on other pricing rules, either uniform or discriminatory.
(c) Competitive Bidding Procedures—Mechanisms. The public notice detailing competitive bidding procedures may establish any of the following mechanisms, without limitation:
(1) Limits on Available Information. Procedures establishing limits on the public availability of information regarding applicants, applications, and bids during a period of time covering the competitive bidding process, as well as procedures for parties to report the receipt of non-public information during such periods.
(2) Sequencing. Procedures establishing one or more groups of eligible areas and if more than one, the sequence of groups for which bids will be accepted.
(3) Reserve Price. Procedures establishing reserve prices, either disclosed or undisclosed, above which bids would not win in the auction. The reserve prices may apply individually, in combination, or in the aggregate.
(4) Timing and Method of Placing Bids. Procedures establishing methods and times for submission of bids, whether remotely, by telephonic or electronic transmission, or in person.
(5) Opening Bids and Bid Increments. Procedures establishing maximum or minimum opening bids and, by announcement before or during the auction, maximum or minimum bid increments in dollar or percentage terms.
(6) Withdrawals. Procedures by which bidders may withdraw bids, if withdrawals are allowed.
(7) Stopping Procedures. Procedures regarding when bidding will stop for a round, a stage, or an entire auction, in order to terminate the auction within a reasonable time and in accordance with public interest considerations and the goals, statutory requirements, rules, and procedures for the auction, including any reserve price or prices.
(8) Activity Rules. Procedures for activity rules that require a minimum amount of bidding activity.
(9) Auction Delay, Suspension, or Cancellation. Procedures for announcing by public notice or by announcement during the reverse auction, delay, suspension, or cancellation of the auction in the event of a natural disaster, technical obstacle, network disruption, evidence of an auction security breach or unlawful bidding activity, administrative or weather necessity, or for any other reason that affects the fair and efficient conduct of the competitive bidding, and procedures for resuming the competitive bidding starting from the beginning of the current or some previous round or cancelling the competitive bidding in its entirety.
(d) Apportioning Package Bids. If the public notice establishing detailed competitive bidding procedures adopts procedures for bidding for support on combinations or packages of geographic areas, the public notice also shall establish a methodology for apportioning such bids among the geographic areas within the combination or package for purposes of implementing any Commission rule or procedure that requires a discrete bid for support in relation to a specific geographic area.
(e) Public Notice of Competitive Bidding Results. After the conclusion of competitive bidding, a public notice shall identify the winning bidders that may apply for the offered universal service support and the amount(s) of support for which they may apply, and shall detail the application procedures.
§ 1.21004   Winning bidder's obligation to apply for support
(a) Timely and Sufficient Application. A winning bidder has a binding obligation to apply for support by the applicable deadline. A winning bidder that fails to file an application by the applicable deadline or that for any reason is not subsequently authorized to receive support has defaulted on its bid.
(b) Dismissal for failure to prosecute. The Commission may dismiss a winning bidder's application with prejudice for failure of the winning bidder to prosecute, failure of the winning bidder to respond substantially within the time period specified in official correspondence or requests for additional information, or failure of the winning bidder to comply with requirements for becoming authorized to receive support. A winning bidder whose application is dismissed for failure to prosecute pursuant to this paragraph has defaulted on its bid(s).
(c) Liability for default payment or forfeiture in the event of auction default. A winning bidder that defaults on its bid(s) is liable for either a default payment or a forfeiture, which will be calculated by a method that will be established as provided in an order or public notice prior to competitive bidding. If the default payment is determined as a percentage of the defaulted bid amount, the default payment will not exceed twenty percent of the amount of the defaulted bid amount.
(d) Additional liabilities. In addition to being liable for a default payment or a forfeiture pursuant to paragraph (c) of this section, a winning bidder that defaults on its winning bid(s) shall be subject to such measures as the Commission may provide, including but not limited to disqualification from future competitive bidding pursuant to this subpart.
§ 1.30000   Purpose.
This rule part protects the operations of AM broadcast stations from nearby tower construction that may distort the AM antenna patterns. All parties holding or applying for Commission authorizations that propose to construct or make a significant modification to an antenna tower or support structure in the immediate vicinity of an AM antenna, or propose to install an antenna on an AM tower, are responsible for completing the analysis and notice process described in this subpart, and for taking any measures necessary to correct disturbances of the AM radiation pattern, if such disturbances occur as a result of the tower construction or modification or as a result of the installation of an antenna on an AM tower. In the event these processes are not completed before an antenna structure is constructed, any holder of or applicant for a Commission authorization is responsible for completing these processes before locating or proposing to locate an antenna on the structure, as described in this subpart.
§ 1.30001   Definitions.
For purposes of this subpart:
(a) Wavelength at the AM frequency. In this subpart, critical distances from an AM station are described in terms of the AM wavelength. The AM wavelength, expressed in meters, is computed as follows:
For example, at the AM frequency of 1000 kHz, or 1 MHz, the wavelength is (300/1 MHz) = 300 meters.
(b) Electrical degrees at the AM frequency. This term describes the height of a proposed tower as a function of the frequency of a nearby AM station. To compute tower height in electrical degrees, first determine the AM wavelength in meters as described in paragraph (a) of this section. Tower height in electrical degrees is computed as follows: (Tower height in meters)/(AM wavelength in meters) × 360 degrees = Tower height in electrical degrees. For example, if the AM frequency is 1000 kHz, then the wavelength is 300 meters, per paragraph (a) of this section. A nearby tower 75 meters tall is therefore [75/300] × 360 = 90 electrical degrees tall at the AM frequency.
(c) Proponent. The term proponent refers in this section to the party proposing tower construction or significant modification of an existing tower or proposing installation of an antenna on an AM tower.
(d) Distance from the AM station. The distance shall be calculated from the tower coordinates in the case of a nondirectional AM station, or from the array center coordinates given in CDBS or any successor database for a directional AM station.
§ 1.30002   Tower construction or modification near AM stations.
(a) Proponents of construction or significant modification of a tower which is within one wavelength of a nondirectional AM station, and is taller than 60 electrical degrees at the AM frequency, must notify the AM station at least 30 days in advance of the commencement of construction. The proponent shall examine the potential impact of the construction or modification as described in paragraph (c) of this section. If the construction or modification would distort the radiation pattern by more than 2 dB, the proponent shall be responsible for the installation and maintenance of any detuning apparatus necessary to restore proper operation of the nondirectional antenna.
(b) Proponents of construction or significant modification of a tower which is within the lesser of 10 wavelengths or 3 kilometers of a directional AM station, and is taller than 36 electrical degrees at the AM frequency, must notify the AM station at least 30 days in advance of the commencement of construction. The proponent shall examine the potential impact of the construction or modification as described in paragraph (c) of this section. If the construction or modification would result in radiation in excess of the AM station's licensed standard pattern or augmented standard pattern values, the proponent shall be responsible for the installation and maintenance of any detuning apparatus necessary to restore proper operation of the directional antenna.
(c) Proponents of construction or significant modification of a tower within the distances defined in paragraphs (a) and (b) of this section of an AM station shall examine the potential effects thereof using a moment method analysis. The moment method analysis shall consist of a model of the AM antenna together with the potential re-radiating tower in a lossless environment. The model shall employ the methodology specified in § 73.151(c) of this chapter, except that the AM antenna elements may be modeled as a series of thin wires driven to produce the required radiation pattern, without any requirement for measurement of tower impedances.
(d) A significant modification of a tower in the immediate vicinity of an AM station is defined as follows:
(1) Any change that would alter the tower's physical height by 5 electrical degrees or more at the AM frequency; or
(2) The addition or replacement of one or more antennas or transmission lines on a tower that has been detuned or base-insulated.
(e) The addition or modification of an antenna or antenna-supporting structure on a building shall be considered a construction or modification subject to the analysis and notice requirements of this subpart if and only if the height of the antenna-supporting structure alone exceeds the thresholds in paragraphs (a) and (b) of this section.
(f) With respect to an AM station that was authorized pursuant to a directional proof of performance based on field strength measurements, the proponent of the tower construction or modification may, in lieu of the study described in paragraph (c) of this section, demonstrate through measurements taken before and after construction that field strength values at the monitoring points do not exceed the licensed values. In the event that the pre-construction monitoring point values exceed the licensed values, the proponent may demonstrate that post-construction monitoring point values do not exceed the pre-construction values. Alternatively, the AM station may file for authority to increase the relevant monitoring-point value after performing a partial proof of performance in accordance with § 73.154 to establish that the licensed radiation limit on the applicable radial is not exceeded.
(g) Tower construction or modification that falls outside the criteria described in the preceding paragraphs is presumed to have no significant effect on an AM station. In some instances, however, an AM station may be affected by tower construction or modification notwithstanding the criteria set forth above. In such cases, an AM station may submit a showing that its operation has been affected by tower construction or modification. Such a showing shall consist of either a moment method analysis as described in paragraph (c) of this section, or of field strength measurements. The showing shall be provided to:
(1) The tower proponent if the showing relates to a tower that has not yet been constructed or modified and otherwise to the current tower owner; and
(2) To the Commission, within two years after the date of completion of the tower construction or modification. If necessary, the Commission shall direct the tower proponent or tower owner, if the tower proponent or tower owner holds a Commission authorization, to install and maintain any detuning apparatus necessary to restore proper operation of the AM antenna. An applicant for a Commission authorization may not propose, and a party holding a Commission authorization may not locate, an antenna on any tower or support structure that has been shown to affect an AM station's operation pursuant to this subparagraph, or for which a disputed showing of effect on an AM station's operation is pending, unless the applicant, party, or tower owner notifies the AM station and takes appropriate action to correct the disturbance to the AM pattern.
(h) An AM station may submit a showing that its operation has been affected by tower construction or modification that was commenced or completed prior to or on the effective date of the rules adopted in this Part pursuant to MM Docket No. 93-177. Such a showing shall consist of either a moment method analysis as described in paragraph (c) of this section, or of field strength measurements. The showing shall be provided to the current tower owner and the Commission within one year of the effective date of the rules adopted in this Part pursuant to MM Docket No. 93-177. If necessary, the Commission shall direct the tower owner, if the tower owner holds a Commission authorization, to install and maintain any detuning apparatus necessary to restore proper operation of the AM antenna.
(i) An applicant for a Commission authorization may not propose, and a party holding a Commission authorization may not locate, an antenna on any tower or support structure, whether constructed before or after December 5, 2013, that meets the criteria in paragraphs (a) and (b) of this section, unless the analysis and notice process described in this subpart, and any necessary measures to correct disturbances of the AM radiation pattern, have been completed by the tower owner, the party proposing to locate the antenna, or any other party, either prior to construction or at any other time prior to the proposal or antenna location.
§ 1.30003   Installations on an AM antenna.
(a) Installations on a nondirectional AM tower. When antennas are installed on a nondirectional AM tower the AM station shall determine the operating power by the indirect method (see § 73.51 of this chapter). Upon completion of the installation, antenna impedance measurements on the AM antenna shall be made. If the resistance of the AM antenna changes by more than 2 percent (see § 73.45(c)(1) of this chapter), an application on FCC Form 302-AM (including a tower sketch of the installation) shall be filed with the Commission for the AM station to return to direct power measurement.
(b) Installations on a directional AM array. Before antennas are installed on a tower in a directional AM array, the proponent shall notify the AM station so that, if necessary, the AM station may determine operating power by the indirect method (see § 73.51 of this chapter) and request special temporary authority pursuant to § 73.1635 of this chapter to operate with parameters at variance.
(1) For AM stations licensed via field strength measurements (see § 73.151(a)), a partial proof of performance as defined by § 73.154 of this chapter shall be conducted by the tower proponent both before and after construction to establish that the AM array will not be and has not been adversely affected. If the operating parameters of the AM array change following the installation, the results of the partial proof of performance shall be filed by the AM station with the Commission on Form 302-AM.
(2) For AM stations licensed via a moment method proof (see § 73.151(c) of this chapter), a base impedance measurement on the tower being modified shall be made by the tower proponent as described in § 73.151(c)(1). The result of the new tower impedance measurement shall be retained in the station's records. If the new measured base resistance and reactance values of the affected tower differ by more than ±2 ohms and ±4 percent from the corresponding modeled resistance and reactance values contained in the last moment method proof, then the station shall file Form 302-AM. The Form 302-AM shall be accompanied by the new impedance measurements for the modified tower and a new moment method model for each pattern in which the tower is a radiating element. Base impedance measurements for other towers in the array, sampling system measurements, and reference field strength measurements need not be repeated. The procedures described in this paragraph may be used as long as the affected tower continues to meet the requirements for moment method proofing after the modification.
(c) Form 302-AM Filing. When the AM station is required to file Form 302-AM following an installation as set forth in paragraphs (a) and (b) of this section, the Form 302-AM shall be filed before or simultaneously with any license application associated with the installation. If no license application is filed as a result of the installation, the Form 302-AM shall be filed within 30 days after the completion of the installation.
§ 1.30004   Notice of tower construction or modification near AM stations.
(a) Proponents of proposed tower construction or significant modification to an existing tower near an AM station that are subject to the notification requirement in §§ 1.30002 and 1.30003 shall provide notice of the proposed tower construction or modification to the AM station at least 30 days prior to commencement of the planned tower construction or modification. Notice shall be provided to any AM station that is licensed or operating under Program Test Authority using the official licensee information and address listed in CDBS or any successor database. Notification to an AM station and any responses may be oral or written. If such notification and/or response is oral, the party providing such notification or response must supply written documentation of the communication and written documentation of the date of communication upon request of the other party to the communication or the Commission. Notification must include the relevant technical details of the proposed tower construction or modification. At a minimum, the notification should include the following:
(1) Proponent's name and address. Coordinates of the tower to be constructed or modified.
(2) Physical description of the planned structure.
(3) Results of the analysis showing the predicted effect on the AM pattern, if performed.
(b) Response to a notification should be made as quickly as possible, even if no technical problems are anticipated. Any response to a notification indicating a potential disturbance of the AM radiation pattern must specify the technical details and must be provided to the proponent within 30 days. If no response to notification is received within 30 days, the proponent may proceed with the proposed tower construction or modification.
(c) The 30-day response period is calculated from the date of receipt of the notification by the AM station. If notification is by mail, this date may be ascertained by:
(1) The return receipt on certified mail;
(2) The enclosure of a card to be dated and returned by the recipient; or
(3) A conservative estimate of the time required for the mail to reach its destination, in which case the estimated date when the 30-day period would expire shall be stated in the notification.
(d) An expedited notification period (less than 30 days) may be requested when deemed necessary by the proponent. The notification shall be identified as “expedited” and the requested response date shall be clearly indicated. The proponent may proceed with the proposed tower construction or modification prior to the expiration of the 30-day notification period only upon receipt of written concurrence from the affected AM station (or oral concurrence, with written confirmation to follow).
(e) To address immediate and urgent communications needs in the event of an emergency situation involving essential public services, public health, or public welfare, a tower proponent may erect a temporary new tower or make a temporary significant modification to an existing tower without prior notice to potentially affected nearby AM stations, provided that the tower proponent shall provide written notice to such AM stations within five days of the construction or modification of the tower and shall cooperate with such AM stations to promptly remedy any pattern distortions that arise as a consequence of such construction.
§ 1.40001   Executive branch review of applications, petitions, other filings, and existing authorizations or licenses with reportable foreign ownership.
(a) The Commission, in its discretion, may refer applications, petitions, and other filings to the executive branch for review for national security, law enforcement, foreign policy, and/or trade policy concerns.
(1) The Commission will generally refer to the executive branch applications filed for an international section 214 authorization and submarine cable landing license as well as an application to assign, transfer control of, or modify those authorizations and licenses where the applicant has reportable foreign ownership and petitions for section 310(b) foreign ownership rulings for broadcast, common carrier wireless, and common carrier satellite earth station licenses pursuant to §§ 1.767, 63.18 and 63.24 of this chapter, and 1.5000 through 1.5004.
(2) The Commission will generally exclude from referral to the executive branch certain applications set out in paragraph (a)(1) of this section when the applicant makes a specific showing in its application that it meets one or more of the following categories:
(i) Pro forma notifications and applications;
(ii) Applications filed pursuant to §§ 1.767 and 63.18 and 63.24 of this chapter if the applicant has reportable foreign ownership and petitions filed pursuant to §§ 1.5000 through 1.5004 where the only reportable foreign ownership is through wholly owned intermediate holding companies and the ultimate ownership and control is held by U.S. citizens or entities;
(iii) Applications filed pursuant to §§ 63.18 and 63.24 of this chapter where the applicant has an existing international section 214 authorization that is conditioned on compliance with an agreement with an executive branch agency concerning national security and/or law enforcement, there are no new reportable foreign owners of the applicant since the effective date of the agreement, and the applicant agrees to continue to comply with the terms of that agreement; and
(iv) Applications filed pursuant to §§ 63.18 and 63.24 of this chapter where the applicant was reviewed by the executive branch within 18 months of the filing of the application and the executive branch had not previously requested that the Commission condition the applicant's international section 214 authorization on compliance with an agreement with an executive branch agency concerning national security and/or law enforcement and there are no new reportable foreign owners of the applicant since that review.
(3) In circumstances where the Commission, in its discretion, refers to the executive branch an application, petition, or other filing not identified in this paragraph (a)(3) or determines to refer an application or petition identified in paragraph (a)(2) of this section, the Commission staff will instruct the applicant, petitioner, or filer to follow the requirements for a referred application or petition set out in this subpart, including submitting responses to the standard questions to the Committee and making the appropriate certifications.
(b) The Commission will consider any recommendations from the executive branch on pending application(s) for an international section 214 authorization or cable landing license(s) or petition(s) for foreign ownership ruling(s) pursuant to §§ 1.5000 through 1.5004 or on existing authorizations or licenses that may affect national security, law enforcement, foreign policy, and/or trade policy as part of its public interest analysis. The Commission will evaluate concerns raised by the executive branch and will make an independent decision concerning the pending matter.
(c) In any such referral pursuant to paragraph (a) of this section or when considering any recommendations pursuant to paragraph (b) of this section, the Commission may disclose to relevant executive branch agencies, subject to the provisions of 44 U.S.C. 3510, any information submitted by an applicant, petitioner, licensee, or authorization holder in confidence pursuant to § 0.457 or § 0.459 of this chapter. Notwithstanding the provisions of § 0.442 of this chapter, notice will be provided at the time of disclosure.
(d) As used in this subpart, “reportable foreign ownership” for applications filed pursuant to §§ 1.767 and 63.18 and 63.24 of this chapter means any foreign owner of the applicant that must be disclosed in the application pursuant to § 63.18(h); and for petitions filed pursuant to §§ 1.5000 through 1.5004 “reportable foreign ownership” means foreign disclosable interest holders pursuant to § 1.5001(e) and (f).
§ 1.40002   Referral of applications, petitions, and other filings with reportable foreign ownership to the executive branch agencies for review.
(a) The Commission will refer any applications, petitions, or other filings for which it determines to seek executive branch review by placing the application, petition, or other filing on an accepted for filing public notice that will provide a comment period for the executive branch to seek deferral for review for national security, law enforcement, foreign policy, and/or trade policy concerns.
(b)(1) The executive branch agency(ies) must electronically file in all applicable Commission file numbers and dockets associated with the application(s), petition(s), or other filing(s) a request that the Commission defer action until the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector (Committee) completes its review. In the request for deferral the executive branch agency must notify the Commission on or before the comment date and must state whether the executive branch:
(i) Sent tailored questions to the applicant(s), petitioner(s), and/or other filer(s);
(ii) Will send tailored questions to the applicant(s), petitioner(s), and/or other filer(s) by a specific date not to be later than thirty (30) days after the date on which the Commission referred the application to the executive branch in accordance with paragraph (a) of this section; or
(iii) Will not transmit tailored questions to the applicant(s), petitioner(s), and/or other filer(s).
(2) The executive branch agency(ies) must electronically file in all applicable Commission file numbers and dockets associated with the application(s), petition(s), or other filing(s) a request by the comment date if it needs additional time beyond the comment period set out in the accepted for filing public notice to determine whether it will seek deferral.
(c) If an executive branch agency(ies) does not notify the Commission that it seeks deferral of referred application(s), petition(s), and/or other filing(s) within the comment period established by an accepted for filing public notice, the Commission will deem that the executive branch does not have any national security, law enforcement, foreign policy, and/or trade policy concerns with the application(s), petition(s), and/or other filing(s) and may act on the application(s), petition(s), and/or other filing(s) as appropriate based on its determination of the public interest.
§ 1.40003   Categories of information to be provided to the executive branch agencies.
(a) Each applicant, petitioner, and/or other filer subject to a referral to the executive branch pursuant to § 1.40001:
(1) Must submit detailed and comprehensive information in the following categories:
(i) Corporate structure and shareholder information;
(ii) Relationships with foreign entities;
(iii) Financial condition and circumstances;
(iv) Compliance with applicable laws and regulations; and
(v) Business and operational information, including services to be provided and network infrastructure, in responses to standard questions, prior to or at the same time the applicant files its application(s), petition(s), and/or other filing(s) with the Commission directly to the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector (Committee).
(2) Must submit a complete and unredacted copy of its FCC application(s), petition(s), and/or other filing(s) to the Committee, including the file number(s) and docket number(s), within three (3) business days of filing it with the Commission.
(b) The standard questions and instructions for submitting the responses and the FCC application(s), petition(s), and/or other filing(s) are available on the FCC website.
(c) The responses to the standard questions shall be submitted directly to the Committee.
§ 1.40004   Time frames for executive branch review of applications, petitions, and/or other filings with reportable foreign ownership.
(a) Tailored questions. For application(s), petition(s), and/or other filing(s) referred to the executive branch, in accordance with § 1.40002(b)(1), the executive branch agency(ies) shall notify the Commission:
(1) That the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector (Committee) has sent tailored questions to the applicant(s), petitioner(s), and/or other filer(s); and
(2) When the Chair of the Committee determines that the applicant's, petitioner's, and/or other filer's responses to any questions and information requests from the Committee are complete.
(b) Initial review—120-day time frame. The executive branch shall notify the Commission by filing in the public record, in all applicable Commission file numbers and dockets for the application(s), petition(s), or other filing(s), no later than 120 days, plus any additional days as needed for escalated review and for NTIA to notify the Commission of the Committee's final recommendation in accordance with Executive Order 13913 (or as it may be amended), from the date that the Chair of the Committee determines that the applicant's, petitioner's, or other filer's responses to the tailored questions are complete, provided that the Committee sent tailored questions within thirty (30) days of the date of the Commission's referral in accordance with § 1.40002(a), and subject to paragraphs (e) and (f) of this section, whether it:
(1) Has no recommendation and no objection to the FCC granting the application;
(2) Recommends that the FCC only grant the application contingent on the applicant's compliance with mitigation measures; or
(3) Needs additional time to review the application(s), petition(s), or other filing(s).
(c) Secondary assessment—additional 90-day time frame. When the executive branch notifies the Commission that it needs an additional 90-day period beyond the initial 120-day period for review of the application, petition, or other filing under paragraph (a) of this section, in accordance with the secondary assessment provisions of Executive Order 13913 (or as it may be amended), the executive branch must:
(1) Explain in a filing on the record why it was unable to complete its review within the initial 120-day review period and state when the secondary assessment began; and
(2) Notify the Commission by filing in the public record, in all applicable Commission file numbers and dockets for the application(s), petition(s), or other filing(s) no later than 210 days, plus any additional days as needed for escalated review and for NTIA to notify the Commission of the Committee's final recommendation in accordance with Executive Order 13913 (or as it may be amended), from the date that the Chair of the Committee determines that the applicant's, petitioner's, or other filer's responses to the tailored questions are complete, provided that the Committee sent tailored questions within thirty (30) days of the date of the Commission's referral in accordance with § 1.40002(a), and subject to paragraphs (e) and (f) of this section, whether it:
(i) Has no recommendation and no objection to the FCC granting the application;
(ii) Recommends that the FCC only grant the application contingent on the applicant's compliance with mitigation measures; or
(iii) Recommends that the FCC deny the application due to the risk to the national security or law enforcement interests of the United States.
(d) Executive branch notifications to the Commission. (1) The executive branch shall file its notifications as to the status of its review in the public record established in all applicable Commission file numbers and dockets for the application, petition, or other filing. Status notifications include notifications of the date on which the Committee sends the tailored questions to an applicant, petitioner, or other filer and the date on which the Chair accepts an applicant's, petitioner's, or other filer's responses to the tailored questions as complete. Status notifications also include extensions of the 120-day review period and 90-day extension period (to include the start and end day of the extension) and updates every thirty (30) days during the 90-day extension period. If the executive branch recommends dismissal of the application, petition, or other filing without prejudice because the applicant, petitioner, or other filer has failed to respond to requests for information, the executive branch shall file that recommendation in the public record established in all applicable Commission file numbers and dockets.
(2) In circumstances where the notification of the executive branch contains non-public information, the executive branch shall file a public version of the notification in the public record established in all applicable Commission file numbers and dockets for the application, petition, or other filing and shall file the non-public information with the Commission pursuant to § 0.457 of this chapter.
(e) Alternative start dates for the executive branch's initial 120-day review. (1) In the event that the executive branch has not transmitted the tailored questions to an applicant within thirty (30) days of the Commission's referral of an application, petition, or other filing, the executive branch may request additional time by filing a request in the public record established in all applicable Commission file numbers and dockets associated with the application, petition, or other filing. The Commission, in its discretion, may allow an extension or start the executive branch's 120-day review clock immediately. If the Commission allows an extension and the executive branch does transmit the tailored questions to the applicant, petitioner, or other filer within the authorized extension period, the initial 120-day review period will begin on the date that executive branch determines the applicant's, petitioner's, or other filer's responses to be complete. If the executive branch does not transmit the tailored questions to the applicant, petitioner, or other filer within the authorized extension period, the Commission, in its discretion, may start the initial 120-day review period.
(2) In the event that the executive branch's notification under § 1.40002(b) indicates that no tailored questions are necessary, the 120-day initial review period will begin on the date of that notification.
(f) Extension of executive branch review periods. In accordance with Executive Order 13913 (or as it may be amended), the executive branch may in its discretion extend the initial 120-day review period and 90-day secondary assessment period. The executive branch shall file notifications of all extensions in the public record.
§ 1.50000   Purpose.
The purpose of this subpart is to implement the Secure and Trusted Communications Networks Act of 2019, Public Law 116-124, 133 Stat. 158.
§ 1.50001   Definitions.
For purposes of this subpart:
(a) Advanced communications service. The term “advanced communications service” means high-speed, switched, broadband telecommunications capability that enables users to originate and receive high-quality voice, data, graphics, and video telecommunications using any technology with connection speeds of at least 200 kbps in either direction.
(b) Appropriate national security agency. The term “appropriate national security agency” means:
(1) The Department of Homeland Security;
(2) The Department of Defense;
(3) The Office of the Director of National Intelligence;
(4) The National Security Agency; and
(5) The Federal Bureau of Investigation.
(c) Communications equipment or service. The term “communications equipment or service” means any equipment or service used in fixed and mobile networks that provides advanced communication service, provided the equipment or service includes or uses electronic components.
(d) Covered communications equipment or service. The term “covered communications equipment or service” means any communications equipment or service that is included on the Covered List developed pursuant to § 1.50002.
(e) Determinations. The term “determination” means any determination from sources identified in § 1.50002(b)(1)(i)-(iv) that communications equipment or service pose an unacceptable risk to the national security of the United States or the security and safety of United States persons.
(f) Covered List. The Covered List is a regularly updated list of covered communications equipment and services.
(g) Reimbursement Program. The Reimbursement Program means the program established by section 4 of the Secure and Trusted Communications Networks Act of 2019, Public Law 116-124, 133 Stat. 158, codified at 47 U.S.C. 1603, as implemented by the Commission in § 1.50004.
(h) Reimbursement Program recipient (or recipient). The term “Reimbursement Program recipient” or “recipient” means an eligible advanced communications service provider that has requested via application and been approved for funding in the Reimbursement Program, regardless of whether the provider has received reimbursement funds.
(i) Replacement List. The Replacement List is a list of categories of suggested replacements for covered communications equipment or service.
§ 1.50002   Covered List.
(a) Publication of the Covered List. The Public Safety and Homeland Security Bureau shall publish the Covered List on the Commission's website and shall maintain and update the Covered List in accordance with § 1.50003.
(b) Inclusion on the Covered List. The Public Safety and Homeland Security Bureau shall place on the Covered List any communications equipment or service that:
(1) Is produced or provided by any entity if, based exclusively on the following determinations, such equipment or service poses an unacceptable risk to the national security of the United States or the security and safety of United States persons:
(i) A specific determination made by any executive branch interagency body with appropriate national security expertise, including the Federal Acquisition Security Council established under section 1222(a) of title 41, United States Code;
(ii) A specific determination made by the Department of Commerce pursuant to Executive Order No. 13873 (3 CFR, 2019 Comp., p 317); relating to securing the information and communications technology and services supply chain);
(iii) Equipment or service being covered telecommunications equipment or services, as defined in section 889(f)(3) of the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (Pub. L. 115-232; 132 Stat. 1918); or
(iv) A specific determination made by an appropriate national security agency;
(2) And is capable of:
(i) Routing or redirecting user data traffic or permitting visibility into any user data or packets that such equipment or service transmits or otherwise handles;
(ii) Causing the networks of a provider of advanced communications services to be disrupted remotely; or
(iii) Otherwise posing an unacceptable risk to the national security of the United States or the security and safety of United States persons.
§ 1.50003   Updates to the Covered List.
(a) The Public Safety and Homeland Security Bureau shall monitor the status of determinations in order to update the Covered List.
(b) If a determination regarding covered communications equipment or service on the Covered List is reversed or modified, the Public Safety and Homeland Security Bureau shall remove from or modify the entry of such equipment or service on the Covered List, except the Public Safety and Homeland Security Bureau may not remove such equipment or service from the Covered List if any other of the sources identified in § 1.50002(b)(1)(i) through (iv) maintains a determination supporting inclusion on the Covered List of such equipment or service.
(c) After each 12-month period during which the Covered List is not updated, the Public Safety and Homeland Security Bureau will issue a Public Notice indicating that no updates were necessary during such period.
§ 1.50004   Secure and Trusted Communications Networks Reimbursement Program.
(a) Eligibility. Providers of advanced communications service with ten million or fewer customers are eligible to participate in the Reimbursement Program to reimburse such providers solely for costs reasonably incurred for the permanent replacement, removal, and disposal of covered communications equipment or services:
(1) As defined in the Report and Order of the Commission in the matter of Protecting Against National Security Threats to the Communications Supply Chain Through FCC Programs (FCC 19-121; WC Docket No. 18-89; adopted November 22, 2019 (in this section referred to as the 'Report and Order'); or
(2) As determined to be covered by both the process of the Report and Order and the Designation Orders of the Commission on June 30, 2020 (DA 20-690; PS Docket No. 19-351; adopted June 30, 2020) (DA 20-691; PS Docket No. 19-352; adopted June 30, 2020) (in this section collectively referred to as the 'Designation Orders');
(3) The provider certifies:
(i) As of the date of the submission of the application, the provider has developed:
(A) A plan for the permanent removal and replacement of any covered communications equipment or service that is in the communications network of the provider as of such date; and the disposal of the equipment or services removed; and
(B) A specific timeline for the permanent removal, replacement, and disposal of the covered communications equipment or service, which timeline shall be submitted to the Commission as part of the application per paragraph (c)(1)(iv) of this section; and
(ii) beginning on the date of the approval of the application, the provider:
(A) Will not purchase, rent, lease, or otherwise obtain covered communications equipment or service, using reimbursement funds or any other funds (including funds derived from private sources); and
(B) In developing and tailoring the risk management practices of the applicant, will consult and consider the standards, guidelines, and best practices set forth in the cybersecurity framework developed by the National Institute of Standards and Technology.
(b) Filing window. The Wireline Competition Bureau shall announce the opening of an initial application filing window for eligible providers seeking to participate in the Reimbursement Program for the reimbursement of costs reasonably incurred for the removal, replacement, and disposal of covered communications equipment and services. The Wireline Competition Bureau may implement additional filing windows as necessary and shall provide notice before opening any additional filing window, and include in that notice the amount of funding available. The Wireline Competition Bureau shall treat all eligible providers filing an application within any filing window as if their applications were simultaneously received. Funding requests submitted outside of a filing window will not be accepted.
(c) Application requests for funding. During a filing window, eligible providers may request a funding allocation from the Reimbursement Program for the reimbursement of costs reasonably incurred for the permanent removal, replacement, and disposal of covered communications equipment or service.
(1) Requests for funding allocations must include:
(i) An estimate of costs reasonably incurred for the permanent removal, replacement, and disposal of covered communications equipment or service from the eligible provider's network. Eligible providers may rely upon the predetermined estimated costs identified in the Catalog of Expenses Eligible for Reimbursement made available by the Wireline Competition Bureau. Eligible providers that submit their own cost estimates must submit supporting documentation and certify that the estimate is made in good faith.
(ii) Detailed information on the covered communications equipment or service being removed, replaced and disposed of;
(iii) The certifications set forth in paragraph (a)(3) of this section;
(iv) A specific timeline for the permanent removal, replacement, and disposal of the covered communications equipment or services; and
(v) The eligible provider certifies in good faith:
(A) It will reasonably incur the estimated costs claimed as eligible for reimbursement;
(B) It will use all money received from the Reimbursement Program only for expenses eligible for reimbursement;
(C) It will comply with all policies and procedures relating to allocations, draw downs, payments, obligations, and expenditures of money from the Reimbursement Program;
(D) It will maintain detailed records, including receipts, of all costs eligible for reimbursement actually incurred for a period of 10 years; and
(E) It will file all required documentation for its expenses.
(d) Application review process. The Wireline Competition Bureau will review applications to determine whether the application is complete, whether the applicant is eligible for the Reimbursement Program, and to assess the reasonableness of the cost estimates provided by the applicant. The Wireline Competition Bureau shall approve or deny applications to receive a funding allocation from the Reimbursement Program within 90 days after the close of the applicable filing window. The Wireline Competition Bureau may extend the deadline for granting or denying applications for up to an additional 45 days if it determines that an excessive number of applications have been filed during the window and additional time is needed to review the applications.
(1) If the Wireline Competition Bureau determines that an application is materially deficient (including by lacking an adequate cost estimate or adequate supporting materials), the Wireline Competition Bureau shall provide the applicant a 15-day period to cure the defect before denying the application. If the cure period would extend beyond the deadline under this paragraph (d) for approving or denying the application, such deadline shall be extended through the end of the cure period.
(2) Denial of an application shall not preclude the applicant from submitting a new application for reimbursement in a subsequent filing window.
(e) Funding allocation. Once an application is approved, the Wireline Competition Bureau will allocate funding on the applicant's behalf to the United States Treasury for draw down by the Reimbursement Program recipient as expenses are incurred pursuant to the funding disbursement process provided for in paragraph (g) of this section.
(f) Prioritization of Support. The Wireline Competition Bureau shall issue funding allocations in accordance with this section after the close of a filing window. After a filing window closes, the Wireline Competition Bureau shall calculate the total demand for Reimbursement Program support submitted by all eligible providers during the filing window period. If the total demand received during the filing window exceeds the total funds available, then the Wireline Competition Bureau shall allocate the available funds consistent with the following priority schedule:
Table 1 to Paragraph ( f )
(1) Application of prioritization schedule. The Wireline Competition Bureau shall issue full funding allocations for all eligible providers in the Priority 1 prioritization category before issuing funding allocations in any subsequent prioritization categories. The Wireline Competition Bureau shall continue to review all funding requests and issue funding allocations by prioritization category until there are no available funds remaining. If there is insufficient funding to fully fund all requests in a particular prioritization category, then the Wireline Competition Bureau will pro-rate the available funding among all eligible providers in that prioritization category. Requests for funds in subsequent prioritization categories will be denied for lack of available funding.
(2) Pro-rata reductions. When pro-rata reductions are required per paragraph (f)(1) of this section, the Wireline Competition Bureau shall:
(i) Divide the total remaining funds available by the demand within the specific prioritization category to produce a pro-rata factor;
(ii) Multiply the pro-rata factor by the total dollar amount requested by each recipient in the prioritization category; and
(iii) Allocate funds to each recipient consistent with this calculation.
(g) Funding disbursements. Following the approval and issuance by the Wireline Competition Bureau of a funding allocation, a Reimbursement Program recipient may file a reimbursement claim request for the draw down disbursement of funds from the recipient's funding allocation. The recipient must show in the reimbursement claim actual expenses reasonably incurred for the removal, replacement, and disposal of covered communications equipment or service. The Wireline Competition Bureau will review and grant or deny reimbursement claims for actual costs reasonably incurred.
(1) Initial reimbursement claim. Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim. Failure to file a reimbursement claim within the one-year period will result in the reclamation of all allocated funding from the Reimbursement Program recipient and revert to the Reimbursement Program fund for potential allocation to other Reimbursement Program participants.
(2) Reimbursement claim deadline. All reimbursement claims must be filed by the Reimbursement Program recipient within 120 days of expiration of the removal, replacement and disposal term. Following the expiration of the reimbursement claim deadline, any remaining and unclaimed funding allocated to the Reimbursement Program recipient will automatically be reclaimed and revert to the Reimbursement Program fund for potential allocation to other Reimbursement Program participants.
(3) Extension of reimbursement claim deadline. A Reimbursement Program recipient may request a single extension of the reimbursement claim deadline by no later than the deadline discussed in paragraph (g)(2). The Wireline Competition Bureau shall grant any timely filed extension request of the reimbursement claim filing deadline for no more than 120 days.
(h) Removal, replacement, and disposal term. Reimbursement Program recipients must complete the permanent removal, replacement, and disposal of covered communications equipment or service within one year of receiving the initial draw down disbursement from their funding allocation.
(1) General extension. The Commission may extend by a period of six months the removal, replacement, and disposal term to all Reimbursement Program recipients if the Commission:
(i) Finds that the supply of replacement communications equipment or services needed by the recipients to achieve the purposes of the Reimbursement Program is inadequate to meet the needs of the recipients; and
(ii) Provides notice and detailed justification for granting the extension to:
(A) The Committee on Energy and Commerce of the House of Representatives; and
(B) The Committee on Commerce, Science, and Transportation of the Senate.
(2) Individual extensions. Prior to the expiration of the removal, replacement and disposal term, a Reimbursement Program recipient may petition the Wireline Competition Bureau for an extension of the term. The Wireline Competition Bureau may grant an extension for up to six months after finding, that due to no fault of such recipient, such recipient is unable to complete the permanent removal, replacement, and disposal by the end of the term. The Wireline Competition Bureau may grant more than one extension request to a recipient if circumstances warrant.
(i) Limitations on funding use. A Reimbursement Program recipient may not:
(1) Use reimbursement funds to remove, replace or dispose of any covered communications equipment or service purchased, rented, leased, or otherwise obtained:
(i) on or after publication of the Report and Order; or
(ii) in the case of any covered communications equipment that only became covered pursuant to the Designation Orders, June 30, 2020; or
(2) Purchase, rent, lease, or otherwise obtain any covered communications equipment or service, using reimbursement funds or any other funds (including funds derived from private sources).
(j) Disposal requirements. Reimbursement Program recipients must dispose of the covered communications equipment or service in a manner to prevent the equipment or service from being used in the networks of other providers of advanced communications service. The disposal must result in the destruction of the covered communications equipment or service, making the covered communications equipment or service inoperable permanently. Reimbursement Program recipients must retain documentation demonstrating compliance with this requirement.
(k) Status updates. Reimbursement Program recipients must file a status update with the Commission 90 days after the date on which the Wireline Competition Bureau approves the recipient's application for reimbursement and every 90 days thereafter, until the recipient has filed the final certification.
(1) Status updates must include:
(i) Efforts undertaken, and challenges encountered, in permanently removing, replacing, and disposing of the covered communications equipment or service;
(ii) The availability of replacement equipment in the marketplace;
(iii) Whether the recipient has fully complied with (or is in the process of complying with) all requirements of the Reimbursement Program;
(iv) Whether the recipient has fully complied with (or is in the process of complying with) the commitments made in the recipient's application;
(v) Whether the recipient has permanently removed from its communications network, replaced, and disposed of (or is in the process of permanently removing, replacing, and disposing of) all covered communications equipment or services that were in the recipient's network as of the date of the submission of the recipient's application; and
(vi) Whether the recipient has fully complied with (or is in the process of complying with) the timeline submitted by the recipient as required by paragraph (c)(1)(iv) of this section.
(2) The Wireline Competition Bureau will publicly post on the Commission's website the status update filings no earlier than 30 days after submission.
(3) Within 180 days of completing the funding allocation stage provided for in paragraph (e), the Wireline Competition Bureau shall prepare a report for Congress providing an update on the Commission's implementation efforts and the work by recipients to permanently remove, replace, and dispose of covered communications equipment and service from their networks.
(l) Spending reports. Within 10 days after the end of January and July, Reimbursement Program recipients must file reports with the Commission regarding how reimbursement funds have been spent, including detailed accounting of the covered communications equipment or service permanently removed and disposed of, and the replacement equipment or service purchased, rented, leased, or otherwise obtained, using reimbursement funds.
(1) This requirement applies starting with the recipient's initial receipt of disbursement funds per paragraph (g) of this section and terminates once the recipient has filed a final spending report. certification.
(2) Following the filing of its final certification per paragraph (m) of this section, certifying that the recipient has completed the removal, replacement, and disposal process, the recipient must file a final spending report showing the expenditure of all funds received as compared to estimated costs identified in its application for funding.
(3) The Wireline Competition Bureau will make versions of the spending reports available on the Commission's website subject to confidentiality concerns consistent with the Commission's rules.
(m) Final certification. Within 10 days following the expiration of the removal, replacement, and disposal term, Reimbursement Program recipient shall file a final certification with the Commission.
(1) The final certification shall indicate whether the recipient has fully complied with (or is in the process of complying with) all terms and conditions of the Reimbursement Program, the commitments made in the application of the recipient for the reimbursement, and the timeline submitted by the recipient as required by paragraph (c) of this section. In addition, the final certification shall indicate whether the recipient has permanently removed from its communications network, replaced, and disposed of (or is in the process of permanently removing, replacing, and disposing of) all covered communications equipment or services that were in the network of the recipient as of the date of the submission of the application by the recipient for the reimbursement.
(2) If a recipient submits a certification under this paragraph stating the recipient has not fully complied with the obligations detailed in paragraph (m)(1) of this section, then the recipient must file an updated certification when the recipient has fully complied.
(n) Documentation retention requirement. Each Reimbursement Program recipient is required to retain all relevant documents, including invoices and receipts, pertaining to all costs eligible for reimbursement actually incurred for the removal, replacement, and disposal of covered communications equipment or services for a period ending not less than 10 years after the date on which it receives final disbursement from the Reimbursement Program.
(o) Audits, reviews, and field investigations. Recipients shall be subject to audits and other investigations to evaluate their compliance with the statutory and regulatory requirements for the Reimbursement Program. Recipients must provide consent to allow vendors or contractors used by the recipient in connection with the Reimbursement Program to release confidential information to the auditor, reviewer, or other representative. Recipients shall permit any representative (including any auditor) appointed by the Commission to enter their premises to conduct compliance inspections.
(p) Delegation of authority. The Commission delegates authority to the Wireline Competition Bureau, to adopt the necessary policies and procedures relating to allocations, draw downs, payments, obligations, and expenditures of money from the Reimbursement Program to protect against waste, fraud, and abuse and in the event of bankruptcy, to establish a Catalog of Expenses Eligible for Reimbursement and predetermined cost estimates, review the estimated cost forms, issue funding allocations for costs reasonably incurred, set filing deadlines and review information and documentation regarding progress reports, allocations, and final accountings.
(q) Provider of Advanced Communications Services. For purposes of the Secure and Trusted Communications Networks Reimbursement Program, the term “provider of advanced communications services” is defined as:
(1) A person who provides advanced communications service to United States customers; and includes:
(A) Accredited public or private non-commercial educational institutions, providing their own facilities-based educational broadband service, as defined in 47 CFR part 27, subpart M, or any successor regulation; and
(B) Health care providers and libraries providing advanced communications service.
(2) [Reserved]
§ 1.50005   Enforcement.
(a) Violations. In addition to the penalties provided under the Communications Act of 1934, as amended, and section 1.80 of this chapter, if a Reimbursement Program recipient violates the Secure and Trusted Communications Networks Act of 2019, Public Law 116-124, 133 Stat. 158, the Commission's rules implementing the statute, or the commitments made by the recipient in the application for reimbursement, the recipient:
(1) Shall repay to the Commission all reimbursement funds provided to the recipient under the Reimbursement Program;
(2) Shall be barred from further participation in the Reimbursement Program;
(3) Shall be referred to all appropriate law enforcement agencies or officials for further action under applicable criminal and civil law; and
(4) May be barred by the Commission from participation in other programs of the Commission, including the Federal universal service support programs established under section 254 of the Communications Act of 1934, as amended.
(b) Notice and opportunity to cure. The penalties described in paragraph (a) of this section shall not apply to a recipient unless:
(1) The Commission, the Wireline Competition Bureau, or the Enforcement Bureau provides the recipient with notice of the violation; and
(2) The recipient fails to cure the violation within 180 days after such notice.
(c) Recovery of funds. The Commission will immediately take action to recover all reimbursement funds awarded to a recipient under the Program in any case in which such recipient is required to repay reimbursement funds under paragraph (a) of this section.
§ 1.50006   Replacement List.
(a) Development of List. The Commission shall develop a list of categories of suggested replacements of physical and virtual communications equipment, application and management software, and services for the covered communications equipment or services listed on the Covered List pursuant to §§ 1.50002 and 1.50003 of this subpart.
(1) In compiling the Replacement List, the Commission may review efforts from, or overseen by, other Federal partners to inform the Replacement List.
(2) The Replacement List shall include categories of physical and virtual communications equipment, application and management software, and services that allows carriers the flexibility to select the equipment or services that fit their needs from categories of equipment and services.
(3) The Wireline Competition Bureau shall publish the Replacement List on the Commission's website.
(b) Maintenance of the List. The Wireline Competition Bureau shall issue a Public Notice announcing any updates to the Replacement List. If there are no updates to the Replacement List in a calendar year, the Wireline Competition Bureau shall issue a Public Notice announcing that no updates that have been made to the Replacement List.
(c) Neutrality. The Replacement List must be technology neutral and may not advantage the use of reimbursement funds for capital expenditures over operational expenditures.
§ 1.50007   Reports on covered communications equipment or services.
(a) Contents of Report. Each provider of advanced communications service must submit an annual report to the Commission that:
(1) Identifies any covered communications equipment or service that was purchased, rented, leased or otherwise obtained on or after:
(i) August 14, 2018, in the case of any covered communications equipment or service on the initial list published pursuant to § 1.50002; or
(ii) Within 60 days after the date on which the Commission places such equipment or service on the list required by § 1.50003;
(2) Provides details on the covered communications equipment or services in its network subject to reporting pursuant to paragraph (a)(1) of this section, including the type, location, date purchased, rented, leased or otherwise obtained, and any removal and replacement plans;
(3) Provides a detailed justification as to why the facilities-based provider of broadband service purchased, rented, leased or otherwise obtained the covered communications equipment or service;
(4) Provides information about whether any such covered communications equipment or service has subsequently been removed and replaced pursuant to Commission's reimbursement program contained in § 1.50004 of this subpart;
(5) Provides information about whether such provider plans to continue to purchase, rent, lease, or otherwise obtain, or install or use, such covered communications equipment or service and, if so, why; and
(6) Includes a certification as to the accuracy of the information reported by an appropriate official of the filer, along with the title of the certifying official.
(b) Reporting deadline. Providers of advanced communications service shall file initial reports within 90 days after the Office of Economics and Analytics issues a public notice announcing the availability of the new reporting platform. Thereafter, filers must submit reports once per year on or before March 31st, reporting information as of December 31st of the previous year.
(c) Reporting exception. If a provider of advanced communications service certifies to the Commission that such provider does not have any covered communications equipment or service in the network of such provider, such provider is not required to submit a report under this section after making such certification, unless such provider later purchases, rents, leases or otherwise obtains any covered communications equipment or service.
(d) Authority to update. The Office of Economics and Analytics may, consistent with these rules, implement any technical improvements, changes to the format and type of data submitted, or other clarifications to the report and its instructions.
§ 1.60000   Purpose.
The purpose of this subpart is to implement the Enhanced Competition Incentive Program (ECIP), a program designed to incentivize Qualifying Transactions in the Wireless Radio Services to increase spectrum access for small carriers and Tribal Nations and to increase competition, and also facilitate the provision of advanced telecommunications services in rural areas by eligible entities.
§ 1.60001   Definitions.
The following definitions are applicable to the ECIP.
(a) Affiliate. A person holding an attributable interest in an applicant if such individual or entity:
(1) Directly or indirectly controls or has the power to control the applicant; or
(2) Is directly or indirectly controlled by the applicant; or
(3) Is directly or indirectly controlled by a third party or parties that also controls or has the power to control the applicant; or
(4) Has an “identity of interest” with the applicant.
See §§ 1.2110 and 1.2112(a)(1) through (7) for further clarification on determining affiliation.
(b) Qualifying transaction. A transaction between unaffiliated parties involving a partition and/or disaggregation, long-term leasing arrangement, or full assignment that meets the requirements of either the small carrier or Tribal Nation transaction prong 



pursuant to § 1.60003 or the rural-focused transaction prong pursuant to § 1.60004.
(c) Qualifying geography. Qualifying Geography is the minimum geography threshold required for the rural-focused transaction prong.
(d) Rural area. Rural area is any area except:
(1) A city, town, or incorporated area that has a population of more than 20,000 inhabitants; or
(2) An urbanized area contiguous and adjacent to a city or town that has a population of more than 50,000 inhabitants.
(e) Small carrier. A small carrier is a carrier, defined as any person engaged as a common carrier for hire, in interstate or foreign communication by wire or radio or interstate or foreign radio transmission of energy in section 3 of the Communications Act of 1934 (47 U.S.C. 153), that:
(1) Has not more than 1,500 employees (as determined under 13 CFR 121.106); and
(2) Offers services using the facilities of the carrier.
(f) Transaction geography. Transaction Geography is the total geography included in a Qualifying Transaction.
(g) Tribal nation. A Tribal Nation is any federally-recognized American Indian Tribe and Alaska Native Village, the consortia of federally recognized Tribes and/or Native Villages, and other entities controlled and majority-owned by such Tribes or consortia.
§ 1.60002   Application requirements for program participation.
Applicants seeking to participate in the ECIP must submit an application on FCC Form 603 or 608, as applicable, to the Wireless Telecommunications Bureau for review and approval that details a Qualifying Transaction through a partition and/or disaggregation pursuant to § 1.950, a full assignment pursuant to § 1.948, a long-term spectrum manager lease arrangement pursuant to § 1.9020, or a long-term de facto transfer lease arrangement pursuant to § 1.9030, and that:
(a) Designates that the Qualifying Transaction identified in the application seeks consideration under the ECIP;
(b) Selects the prong applicable to its Qualifying Transaction, either § 1.60003 or § 1.60004, but not both, even if a party to the transaction is eligible under both prongs, and demonstrates that the applicants meet each requirement under § 1.60003 or § 1.60004;
(c) Demonstrates that the applicants to the Qualifying Transaction are unaffiliated by providing a list of all affiliated entities for each party to the transaction through the filing of a new FCC Form 602, or the filing of an updated FCC Form 602 if the ownership information is not current;
(d) Includes a certification that the applicants to the Qualifying Transaction are not barred from the ECIP pursuant to § 1.60007;
(e) Includes a certification that the license(s) included in the application have not previously received benefits under the ECIP pursuant to § 1.60005;
(f) Includes a certification that the applicants entered into the Qualifying Transaction in good faith and that the licensee/lessor reasonably believes the assignee/lessee has the resources and a bona fide intent to meet the program's obligations;
(g) Includes a certification that the assignor or lessor either did not confer any benefit (monetary or otherwise) to the assignee or lessee as consideration for entering into the proposed ECIP transaction or, if benefits were conferred to the assignee or lessee, the application must include a narrative with a detailed description of any benefits so conferred by the assignor or lessor to the assignee or lessee, respectively; and
(h) Includes a certification that any lease arrangement entered into for purposes of ECIP participation is for a minimum term of five (5) years, whether a long-term de facto transfer lease arrangement or a long-term spectrum manager lease arrangement.
§ 1.60003   Small carrier or tribal nation transaction prong.
(a) Eligibility. The following parties are eligible to participate through a Qualifying Transaction under the small carrier or Tribal Nation transaction prong of the ECIP: an assignor that is a covered geographic licensee as defined under § 1.907; a lessor in an included service as set forth in § 1.9005 that is also a covered geographic licensee as defined under § 1.907; and an unaffiliated assignee or unaffiliated lessee that is a small carrier or a Tribal Nation as defined in this subpart, except that a transaction shall not be eligible for participation in the ECIP under this prong if it includes either:
(1) A license(s) with existing shared construction obligations pursuant to § 1.950(g);
(2) An application to participate in ECIP that includes an election from the parties to share construction obligations pursuant to § 1.950(g);
(3) A light-touch leasing spectrum manager lease arrangement(s) of 3.5 GHz Priority Access Licenses in the Citizens Band Radio Service; or
(4) An application to participate in ECIP that includes a barred party pursuant to § 1.60007.
(b) Qualification requirements. An applicant in a Qualifying Transaction under the small carrier or Tribal Nation transaction prong must demonstrate that:
(1) The ECIP transaction involving a disaggregation, partition/disaggregation in combination, full license assignment, or a lease, includes a minimum of 50% of the licensed spectrum, and meets the minimum spectrum threshold at every point in the Transaction Geography (where the percentage is calculated at any point as the amount of spectrum being assigned/leased (in megahertz)/total spectrum held under the license (in megahertz);
(2) The ECIP transaction involving a partition, partition/disaggregation in combination, full license assignment, or a lease, includes a minimum Transaction Geography of 25% of the total licensed area for licenses with a licensed area that contains 30,000 square miles or less, or a minimum Transaction Geography of 10% of the total licensed area for licenses with a licensed area 30,001 square miles or larger;
(3) If a lease arrangement, the minimum term of a long-term spectrum manager lease or de facto transfer lease is at least five (5) years; and
(4) The ECIP transaction was entered into in good faith with a bona fide intent by all parties to meet the program's obligations.
(c) Qualifying Transaction limitations. Multiple licenses may be included in a Qualifying Transaction between unaffiliated parties under this prong, however, spectrum and geography cannot be aggregated across multiple licenses to meet the respective minimum thresholds; each license in a Qualifying Transaction shall be considered separately and must independently meet the respective minimum spectrum and geography thresholds in paragraph (b) of this section. Each license included in a Qualifying Transaction under this prong shall either be the subject of an assignment (full, partition and/or disaggregation) or a lease arrangement, but not both. A party to a Qualifying Transaction under this prong is not permitted to assign a part of a license and lease a different part of the same license to meet the respective minimum spectrum and geographic thresholds.
§ 1.60004   Rural-focused transaction prong.
(a) Eligibility. The following parties are eligible to participate through a Qualifying Transaction under the rural-focused transaction prong of the ECIP: an assignor that is a covered geographic licensee as defined by § 1.907; a lessor in an included service as set forth in § 1.9005 that is also a covered geographic licensee as defined by § 1.907; and an unaffiliated assignee or lessee that commits to meeting the requirements of the rural-focused transaction prong, except that a transaction shall not be eligible for participation in the ECIP under this prong if it includes either:
(1) A license(s) with existing shared construction obligations pursuant to § 1.950(g);
(2) An application to participate in ECIP that includes an election from the parties to share construction obligations pursuant to § 1.950(g);
(3) A light-touch leasing spectrum manager lease arrangement(s) of 3.5 GHz Priority Access Licenses in the Citizens Band Radio Service; or
(4) An application to participate in ECIP that includes a barred party pursuant to § 1.60007.
(b) Qualification requirements. An applicant in a Qualifying Transaction under the rural-focused transaction prong must demonstrate that:
(1) The ECIP transaction involving a disaggregation, partition/disaggregation in combination, or a lease, includes a minimum of 50% of the licensed spectrum, and meets the minimum spectrum threshold at every point in the Transaction Geography (where the percentage is calculated at any point as the amount of spectrum being assigned/leased (in megahertz)/total spectrum held under the license (in megahertz));
(2) The minimum Qualifying Geography threshold of exclusively rural area is included in the application based on the following scaled categories:
(i) 300 contiguous square miles for contributing licenses with licensed area containing up to 30,000 square miles;
(ii) 900 contiguous square miles for contributing licenses with licensed area containing between 30,001-90,000 square miles;
(iii) 5,000 contiguous square miles for contributing licenses with licensed area containing between 90,001-500,000 square miles; or
(iv) 15,000 contiguous square miles for contributing licenses with licensed area containing 500,001 square miles or more;
(3) If a lease arrangement, the minimum term of a long-term spectrum manager lease or de facto transfer lease is at least five (5) years; and
(4) The ECIP transaction was entered into in good faith with a bona fide intent by all parties to meet the program's obligations.
(c) Multiple contributing licenses. Qualifying Transactions between unaffiliated parties under the rural-focused transaction prong must specify at least one area of Qualifying Geography, and one or more licenses may contribute, via any combination of full assignment, partitioning and/or disaggregation, and/or lease(s), provided the Qualifying Geography intersects each contributing license included in the underlying application. Where multiple licenses with different size licensed areas are included in the Qualifying Transaction and each contributes to the Qualifying Geography, the Qualifying Geography must consist of the minimum geographic threshold applicable to the contributing license with the greatest square mileage in its licensed area.
§ 1.60005   Program benefits.
(a) Program benefits. The following benefits for license(s) included in an ECIP Qualifying Transaction filed pursuant to § 1.60002, shall be conferred upon consummation of a Commission approved assignment application, grant of a de facto transfer lease application, or acceptance of a spectrum manager lease application, as specified:
(1) License term extension. All parties to a partition and/or disaggregation Qualifying Transaction; the lessor entering into a spectrum lease arrangement Qualifying Transaction; and the assignee in a full license assignment Qualifying Transaction, shall receive a five-year license term extension on the license(s) subject to the application.
(2) Construction extension. All parties to a partition and/or disaggregation Qualifying Transaction; the lessor entering into a spectrum lease arrangement Qualifying Transaction; and the assignee in a full license assignment Qualifying Transaction, shall receive a one-year construction extension of both the interim and final performance requirement deadline, where applicable, on the license(s) subject to the application. Where the Commission has previously extended a performance requirement deadline on the license(s) and that deadline has not passed, the one year extension conferred through ECIP is in addition to the prior extension, provided the extension that was previously granted, whether by rule or through waiver, is transferrable, and the assignee separately justifies such relief if required.
(3) Substitution of alternative construction requirement. The assignee in a qualifying partition, combination partition disaggregation transaction, or full license assignment filed under the rural focused-transaction prong in § 1.60004, shall be subject to the alternative construction requirement set forth in § 1.60006 in lieu of any applicable service-based performance requirement for the license(s) resulting from an ECIP transaction. Where the Commission has previously modified the assignor's substantive service-based performance requirement through conditions granted by waiver and such requirements have not been met, the assignee will receive the substituted alternative construction requirement benefit if the assignee separately requests, and is granted, a waiver.
(b) Limitation on duplicative benefits. (1) A license included in a Commission approved Qualifying Transaction in the ECIP shall be eligible for program benefits a single time per license for the license term and all subsequent renewal terms.
(2) A license, including a license resulting from a partition and/or disaggregation, previously included in a Qualifying Transaction approved by the Commission in the ECIP, shall be ineligible to receive benefits in any subsequent ECIP transaction, regardless of whether the current licensee was the beneficiary in the original or a subsequent Qualifying Transaction.
§ 1.60006   Program obligations.
(a) Compliance with requirements under selected prong. An assignee or lessee must comply with the requirements of either the small carrier or Tribal Nation transaction prong in § 1.60003 or the rural-focused transaction prong in § 1.60004, as selected in its ECIP application, and is not permitted to change prongs after the consummation of the Commission approved assignment application, grant of a de facto transfer lease application, or acceptance of a spectrum manager lease application for a Qualifying Transaction in ECIP.
(b) Construction requirement for rural-focused transaction prong assignees. Assignees shall be subject to the following construction requirements for any resulting license(s) granted in a Commission approved Qualifying Transaction through partition, a combination partition/disaggregation, or full license assignment filed under the rural-focused transaction prong in ECIP, which supersedes any service-based requirement:
(1) The assignee must construct and operate, or provide signal coverage and offer service to, 100% of the Qualifying Geography identified in the Commission approved Qualifying Transaction.
(2) The construction period is the applicable construction deadline identified on the respective license(s), as extended by § 1.60005. If no such deadline remains for the license(s), the assignee must construct and operate, or provide signal coverage and offer service to, 100% of the Qualifying Geography no later than two (2) years after the consummation of the Commission approved application.
(3) Where the assignee is subject to both an interim and final performance benchmark, the performance requirements in this paragraph (b) shall replace the interim performance benchmark and the assignee shall not be subject to a final performance requirement. Where the assignee has only a remaining final performance requirement, the performance requirements in this paragraph (b) shall replace the final benchmark.
(4) All end user devices throughout the Qualifying Geography must be capable of operation on all spectrum bands associated with license(s) that contribute to the Qualifying Geography.
(5) Consistent with § 1.946(d), notification of completion of construction must be provided to the Commission through the filing of FCC Form 601, no later than 15 days after the applicable construction deadline or the expiration of the two (2) year period in paragraph (b)(2) of this section.
(c) Operational requirement for rural-focused transaction prong assignees. Assignees in a Commission approved rural-focused transaction pursuant to § 1.60004 are subject to the following operational requirements:
(1) Assignees must construct and operate in, or provide signal coverage and offer service to, 100% of the Qualifying Geography identified in the Commission approved Qualifying Transaction for a period of at least three (3) consecutive years;
(2) Operation or service must not fall below that used to meet the construction requirement in paragraph (b) of this section for the entire three (3) year period; and
(3) Assignees must construct and operate, or provide signal coverage and offer service, as required pursuant to paragraph (b) of this section, by the applicable construction deadline identified on the license(s), as extended by § 1.60005. Where no such deadline remains for the license(s), the three (3) year continuous operational requirement must commence no later than two (2) years after the consummation of the Commission approved application filed pursuant to § 1.60002.
(d) Construction and operational requirements for rural-focused transaction prong leases. Lessees must construct and operate, or provide signal coverage and offer service to, 100% of the Qualifying Geography identified in the underlying Qualifying Transaction that was the basis for Commission approval in the ECIP. Lessees must meet this requirement no later than two (2) years after grant of the underlying de facto transfer lease application or acceptance of the underlying spectrum manager lease application, and must maintain operation for a period of at least three (3) consecutive years during any period within the initial minimum required five (5) year lease term.
(e) Operational requirement notifications. Assignees and/or lessees of rural-focused transactions subject to § 1.60004 must file the following notifications to demonstrate compliance with the requirements in paragraphs (a) through (c) of this section:
(1) Initial operational requirement notification. Assignees and/or lessees must file an initial operational notification with the Commission within 30 days of the commencement of operations that:
(i) Provides the date operations began;
(ii) Certifies that the operational requirement of 100% coverage of the Qualifying Geography for that assigned license or lease has been satisfied; and
(iii) Provides technical data demonstrating such compliance.
(2) Final operational requirement notification. Assignees and/or lessees must file a final operational notification requirement with the Commission within 30 days of completion of the three consecutive year operational requirement that:
(i) Certifies that the operational requirement of 100% coverage of the Qualifying Geography for three (3) consecutive years has been satisfied;
(ii) Provides the date the three (3) year period was completed; and
(iii) Provides technical data demonstrating the coverage provided during the three (3) year period.
(f) Holding period. Assignees and/or lessees participating in ECIP under either the small carrier or Tribal Nation transaction prong set forth in § 1.60003, or the rural-focused transaction prong set forth in § 1.60004, must comply with the following obligations:
(1) Assignees. An assignee of a license(s) granted in a Qualifying Transaction involving a partition and/or disaggregation or full assignment is required to hold any such license(s) for a period of at least five (5) years, commencing upon the consummation date of the Commission approved application filed pursuant to § 1.60002. During this holding period, except as provided in paragraph (g) of this section, the license(s) received through ECIP is not permitted to be further partitioned, disaggregated, assigned, or leased.
(2) Lessees. Lease arrangements subject to the ECIP shall not be terminated by either lessor or lessee prior to the expiration of the five (5) year term required by § 1.60003(b)(3) or § 1.60004(b)(3), where applicable, and, except as provided in paragraph (g) of this section, may not be transferred or subleased to another party during the five (5) year term.
(3) Rural-focused transaction prong assignees. Any license(s) resulting from a Qualifying Transaction under the rural-focused transaction prong pursuant to § 1.60004 may not be subsequently assigned (partition and/or disaggregation or full assignment), leased or transferred until the following conditions have been met:
(i) The license(s) has been held by the assignee of the Qualifying Transaction for a period of at least five (5) years commencing on the date of consummation of the Commission approved application filed pursuant to § 1.60002; and
(ii) The construction and operational requirements pursuant to paragraphs (a) through (d) of this section, where applicable, have been satisfied.
(g) Exceptions. The requirements in paragraphs (a) through (e) of this section do not apply to pro forma transfers pursuant to § 1.948(c)(1), and do not apply to any area of the Transaction Geography and/or Qualifying Geography, which is covered by a lease or sublease entered into for the purpose of enabling a Contraband Interdiction System (as defined in § 1.9003).
§ 1.60007   Penalties.
(a) Automatic termination. A license(s) resulting from a Qualifying Transaction in the ECIP shall be automatically terminated without specific Commission action or further notice to the licensee, superseding any service-based penalty, if the assignee fails to comply with any of the following:
(1) The five (5) year holding period pursuant to § 1.60006(f);
(2) The construction requirement pursuant to § 1.60006(b) or (d), or any remaining service-based performance requirement, where applicable; or
(3) The operational requirements pursuant to § 1.60006(c) or (d), where applicable.
(b) Bar from future program participation. A party participating in a Commission approved Qualifying Transaction in the ECIP shall be prohibited from future participation in the ECIP where it is found that it:
(1) Violated the five (5) year holding period requirements of § 1.60006(f), including premature termination of a lease or entering into a sublease in violation of § 1.60006(f)(2), if applicable;
(2) Failed to meet the construction requirement of § 1.60006(b) or (d), or any remaining service-based performance requirement, where applicable;
(3) Failed to meet the operational requirements of § 1.60006(c) or (d), where applicable; or
(4) Entered into a bad faith transaction in violation of § 1.60003(b)(4) or § 1.60004(b)(4).
(c) Effect of program bar. A bar from ECIP is applied as follows:
(1) A program bar shall commence upon the date the assignee or lessee receives notice from the Commission via electronic mail finding a violation pursuant to paragraph (b) of this section. A barred party shall be eligible to continue to receive benefits from Qualifying Transactions in ECIP that are unrelated to the Qualifying Transaction that resulted in the program bar, provided that those benefits were conferred prior to the commencement of the program bar, as a result of the Commission accepting a consummation of an approved assignment application, granting a de facto transfer lease application, or accepting a spectrum manager lease application, as applicable.
(2) A program bar shall also apply to affiliates of barred parties. Third-parties shall be considered affiliates of a barred party if they qualify as an affiliate under § 1.60001. A prospective ECIP participant will be considered a barred affiliate when either:
(i) The third-party was identified, or should have been identified, as an affiliate on the initial Commission approved application for the Qualifying Transaction resulting in the bar; or
(ii) The third-party identifies, or should have identified, a barred affiliate in a subsequent application to participate in the ECIP, regardless of whether they were affiliates at the time of the filing of the initial application for a Qualifying Transaction resulting in the bar.
(3) Transactions that include a barred party shall not be eligible for ECIP benefits, even if all other qualifications are satisfied.