Source: http://www.fcc.gov/document/paging-band-auction-scheduled-july-16-2013-comments-sought?fontsize=
Timestamp: 2014-09-16 10:23:46
Document Index: 159815290

Matched Legal Cases: ['§ 1', 'art 22', 'art 90', 'art 22', 'art 90', '§ 309', '§ 309', '§ 1', 'art 1', 'art 1', 'art 1', 'art 1', 'arts 22', 'art 1', '§ 1', 'art 1', '§ 1', '§ 1', '§1', '§ 1', 'art 1', '§ 1', '§ 1', '§ 1', 'art 1', 'art 1', '§ 1', '§ 1', '§ 1', 'art 1', '§ 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', '§ 0', '§ 0', '§ 1', 'art 1', '§ 1', '§ 337', '§ 1', '§ 22', '§ 22', '§ 1', '§ 22', 'art 1', 'art 1', '§ 1', 'art 1']

Auction 95 (Paging Licenses) Procedures | FCC.gov
Home / Business & Legal / Commission Documents / Auction 95 (Paging Licenses) ProceduresCommission Document	Print
Auction 95 (Paging Licenses) Procedures
DA 13-535
AUCTION OF LOWER AND UPPER PAGING BANDS LICENSES SCHEDULED FOR JULY 16, 2013
NOTICE AND FILING REQUIREMENTS, MINIMUM OPENING BIDS, UPFRONT PAYMENTS, AND OTHER PROCEDURES FOR AUCTION 95
1. Background of Proceeding ........................................................................................................ 22. Licenses to be Offered in Auction 95........................................................................................ 4
B. License Descriptions ........................................................................................................................ 6C. Rules and Disclaimers...................................................................................................................... 8
1. Relevant Authority .................................................................................................................... 82. Prohibited Communications and Compliance with Antitrust Laws ........................................ 103. Incumbency Issues................................................................................................................... 364. Due Diligence.......................................................................................................................... 395. Use of Integrated Spectrum Auction System .......................................................................... 486. Fraud Alert............................................................................................................................... 497. Environmental Review Requirements ..................................................................................... 51
D. Auction Specifics ........................................................................................................................... 52
1. Auction Start Date ................................................................................................................... 522. Auction Title............................................................................................................................ 543. Bidding Methodology.............................................................................................................. 554. Pre-Auction Dates and Deadlines............................................................................................ 565. Requirements for Participation................................................................................................ 57
II. SHORT-FORM APPLICATION (FCC FORM 175) REQUIREMENTS ........................................... 58
A. General Information Regarding Short-Form Applications ............................................................ 58B. License Selection ........................................................................................................................... 63C. Disclosure of Bidding Arrangements............................................................................................. 65D. Ownership Disclosure Requirements............................................................................................. 68E. Designated Entity Provisions ......................................................................................................... 70
1. Bidding Credits for Small Businesses ..................................................................................... 712. Attributable Interests ............................................................................................................... 763. Installment Payments............................................................................................................... 84
F. Tribal Lands Bidding Credit .......................................................................................................... 85G. Provisions Regarding Former and Current Defaulters................................................................... 86
H. Optional Applicant Status Identification........................................................................................ 92I.
Minor Modifications to Short-Form Applications ......................................................................... 93
J. Maintaining Current Information in Short-Form Applications...................................................... 99
III. PRE-AUCTION PROCEDURES....................................................................................................... 100
A. Online Auction Tutorial – Available April 30, 2013 ................................................................... 100B. Short-Form Applications – Due Prior to 6:00 p.m. ET on May 9, 2013...................................... 103C. Application Processing and Minor Corrections ........................................................................... 106D. Upfront Payments – Due June 13, 2013....................................................................................... 109
1. Making Upfront Payments by Wire Transfer ........................................................................ 1102. FCC Form 159....................................................................................................................... 1143. Upfront Payments and Bidding Eligibility ............................................................................ 115
E. Applicant’s Wire Transfer Information for Purposes of Refunds of Upfront Payments ............. 122F. Auction Registration .................................................................................................................... 123G. Remote Electronic Bidding.......................................................................................................... 127H. Mock Auction – July 12, 2013..................................................................................................... 129
IV. AUCTION .......................................................................................................................................... 130
A. Auction Structure ......................................................................................................................... 131
1. Simultaneous Multiple Round Auction ................................................................................. 1312. Limited Information Disclosure Procedures: Information Available to Bidders Before and During the Auction ......................................................................................................... 132
3. Eligibility and Activity Rules................................................................................................ 1424. Auction Stages....................................................................................................................... 1465. Stage Transitions ................................................................................................................... 1516. Activity Rule Waivers ........................................................................................................... 1537. Auction Stopping Rules......................................................................................................... 1588. Auction Delay, Suspension, or Cancellation ......................................................................... 161
B. Bidding Procedures...................................................................................................................... 163
1. Round Structure..................................................................................................................... 1632. Reserve Price and Minimum Opening Bids .......................................................................... 1653. Bid Amounts.......................................................................................................................... 1704. Provisionally Winning Bids .................................................................................................. 1775. Bidding .................................................................................................................................. 1806. Bid Removal and Bid Withdrawal......................................................................................... 1877. Round Results........................................................................................................................ 1958. Auction Announcements ....................................................................................................... 196
V. POST-AUCTION PROCEDURES .................................................................................................... 197
A. Down Payments ........................................................................................................................... 198B. Final Payments............................................................................................................................. 199C. Long-Form Application (FCC Form 601).................................................................................... 200D. Ownership Disclosure Information Report (FCC Form 602) ...................................................... 202E. Tribal Lands Bidding Credit ........................................................................................................ 205F. Default and Disqualification ........................................................................................................ 208G. Refund of Remaining Upfront Payment Balance......................................................................... 211
VI. CONTACT INFORMATION ............................................................................................................ 213Attachment A: Summary of Licenses to Be Auctioned ............................................................................A-1Attachment B: Block/Frequency Cross-Reference List
Attachment C: Short-Form Application (FCC Form 175) Filing Instructions.......................................... C-1Attachment D: Auction-Specific Instructions for FCC Remittance Advice (FCC Form 159) .................D-1Attachment E: Summary Listing of Judicial, Commission and Bureau Documents Addressing Application of the Ruling Prohibiting Certain Communications, 47 C.F.R. § 1.2105(C).................. E-1
By this Public Notice, the Wireless Telecommunications Bureau (“Bureau”) establishes the procedures and minimum opening bid amounts for the upcoming auction of 5,905 licenses for lower and upper paging bands spectrum.1 This auction, which is designated as Auction 95, is scheduled to start on July 16, 2013. This Public Notice provides an overview of the procedures, terms and conditions governing Auction 95 and the post-auction application and payment processes. 1.
In the Paging Second Report and Order, the Commission adopted rules governing geographic licensing for exclusive channels in the 35 MHz, 43 MHz, 152 and 158 MHz, 454 MHz and 459 MHz, 929 MHz, and 931 MHz bands allocated for paging, and competitive bidding procedures for resolving mutually exclusive applications for non-nationwide geographic area licenses in those bands.2 The Commission has since made paging licenses available through competitive bidding in four auctions: Auction 26 (upper bands only) in 2000;3 Auction 40 (upper and lower bands) in 2001;4 Auction 48 (upper and lower bands) in 2003;5 and Auction 87 (upper and lower bands) in 2010.6
On February 1, 2013, in accordance with section 309(j)(3) of the Communications Act of 1934, as amended (the “Act”),7 the Bureau released a public notice seeking comment on competitive bidding procedures to be used in Auction 95.8 No comments were submitted in response to the Auction 95 Comment Public Notice.
1 The lower band paging bands consist of frequencies at 35 to 36 MHz (“35 MHz”), 43 to 44 MHz (“43 MHz”), 152 to 159 MHz (“152 and 158 MHz”), and 454 to 460 MHz (“454 and 459 MHz”). The upper paging bands consist of frequencies at 929 MHz and 931 MHz (“929 MHz” and 931 MHz”).
2 Revision of Part 22 and Part 90 of the Commission’s Rules to Facilitate Future Development of Paging Systems, Implementation of Section 309(j) of the Communications Act — Competitive Bidding, WT Docket No 96-18, PP Docket No. 93-253, Second Report and Order and Further Notice of Proposed Rulemaking, FCC 97-59, 12 FCC Rcd 2732, 2748 ¶ 23, 2779-2820 ¶¶ 89-201 (1997) (“Paging Second Report and Order”). See also Revision of Part 22 and Part 90 of the Commission’s Rules to Facilitate Future Development of Paging Systems, Implementation of Section 309(j) of the Communications Act – Competitive Bidding, WT Docket No. 96-18, PR Docket No. 93-253, Memorandum Opinion and Order on Reconsideration and Third Report and Order, FCC 99-98, 14 FCC Rcd 10030, 10043-46 ¶¶ 14-21 (1999) (“Paging Reconsideration Order”).
3 “929 and 931 MHz Paging Auction Closes; Winning Bidders of 985 Licenses Announced; Down Payments Due March 20, 2000; FCC Forms 601 and 602 Due March 20, 2000; Ten-Day Petition to Deny Period,” Public Notice, DA 00-508, 15 FCC Rcd 4858 (2000).
4 “Lower and Upper Paging Bands Auction Closes; Winning Bidders Announced; Down Payments Due December 27, 2001; FCC Forms 601 and 602 Due December 27, 2001; Ten-Day Petition to Deny Period,” Public Notice, DA 01-2858, 16 FCC Rcd 21821 (2001).
5 “Lower and Upper Paging Bands Auction Closes; Winning Bidders Announced; Down Payments Due June 13, 2003; FCC Forms 601 and 602 Due June 13, 2003; Ten-Day Petition to Deny Period,” Public Notice, DA 03-1836, 18 FCC Rcd 11154 (2003).
6 “Lower and Upper Paging Bands Auction Closes; Winning Bidders Announced; Down Payments Due August 26, 2010; FCC Forms 601 and 602 Due August 26, 2010; Ten-Day Petition to Deny Period,” Public Notice, 25 FCC Rcd 18164 (2010).
7 47 U.S.C. § 309(j)(3)(E)(i) (requirement to seek comment on proposed auction procedures); see also 47 U.S.C. § 309(j)(4)(F) (authorization to prescribe reserve price or minimum bid); 47 C.F.R. §§ 1.2104(c) and (d). 8 “Auction of Lower and Upper Paging Bands Licenses Scheduled for July 16, 2013; Comment Sought on Competitive Bidding Procedures For Auction 95,” AU Docket No. 13-12, Public Notice, DA 13-60 (rel. Feb. 1, (continued….)
Auction 95 will offer 5,905 licenses consisting of 4,902 licenses in the lower paging bands (35-36 MHz, 43-44 MHz, 152-159 MHz, 454-460 MHz) and 1,003 licenses in the upper paging bands (929-931 MHz). Auction 95 will include licenses that remained unsold from previous auctions, licenses on which a winning bidder in a previous auction defaulted, and licenses for spectrum previously associated with licenses that cancelled or terminated. In a few cases, the available license does not cover the entire geographic area due to an excluded area or previous partitioning. 5.
Attachment A to this Public Notice provides a summary of the licenses available in Auction 95. Due to the large number of licenses in Auction 95, the complete list of licenses available for this auction will be provided in electronic format only, available as separate “Attachment A” files at http://wireless.fcc.gov/auctions/95/.9 The “Attachment A” files reflect corrections made to the market name provided for 43 of the licenses listed as available in this auction in the Auction 95 Comment Public Notice. Those licenses for which the market name has been corrected are noted by a single “*.” The market and license numbers for these licenses are unchanged. B.
In the Paging Reconsideration Order, the Commission concluded that the licenses in the lower paging bands should be awarded in each of the 175 geographic areas known as Economic Areas (EAs), and the licenses in the upper paging bands should be awarded in each of the 51 geographic areas known as Major Economic Areas (MEAs).10 These EAs and MEAs encompass the United States, Guam, the Northern Mariana Islands, Puerto Rico, the U.S. Virgin Islands, and American Samoa.
Tables containing the block/frequency cross-reference list for the paging bands are included in Attachment B to this Public Notice.
Prospective applicants must familiarize themselves thoroughly with the Commission’s general competitive bidding rules,11 including Commission decisions in proceedings regarding competitive bidding procedures, application requirements, and obligations of Commission licensees.12 Prospective bidders should also familiarize themselves with the Commission’s rules relating to the lower (Continued from previous page) 2013) (“Auction 95 Comment Public Notice”). A summary of this public notice was published at 78 Fed. Reg. 11179 (Feb. 15, 2013).
9 A copy of the complete list of licenses and any other documents relating to Auction 95 may also be obtained, for a fee, from the Commission’s duplicating contractor, Best Copy and Printing, Inc. (“BCPI”). Contact information for BCPI may be found in Section VI, Contact Information, below. When ordering documents from BCPI, you should provide the appropriate FCC document number (for example, DA 13-535 for this Public Notice).
10 See Paging Reconsideration Order, 14 FCC Rcd at 10043-46 ¶¶ 14-21.11 See 47 C.F.R. Part 1, Subpart Q. 12 See, e.g., Amendment of Part 1 of the Commission's Rules – Competitive Bidding Procedures, WT Docket No. 97-82, Order on Reconsideration of the Third Report and Order, Fifth Report and Order, and Fourth Further Notice of Proposed Rule Making, FCC 00-274, 15 FCC Rcd 15293 (2000) (“Part 1 Fifth Report and Order”)(modified by Erratum, DA 00-2475 (rel. Nov. 3, 2000)); Seventh Report and Order, FCC 01-270, 16 FCC Rcd 17546 (2001) (“Part 1 Seventh Report and Order”); Eighth Report and Order, FCC 02-34, 17 FCC Rcd 2962 (2002); Second Order on Reconsideration of the Third Report and Order and Order on Reconsideration of the Fifth Report and Order, FCC 03-98, 18 FCC Rcd 10180 (2003); Second Order on Reconsideration of the Fifth Report and Order, FCC 04-295, 20 FCC Rcd 1942 (2005). 4
and upper paging bands,13 and rules relating to applications, environment, practice and procedure.14 All bidders must also be thoroughly familiar with the procedures, terms and conditions contained in this Public Notice and any future public notices that may be issued in this proceeding. 9.
The terms contained in the Commission’s rules, relevant orders, and public notices are not negotiable. The Commission may amend or supplement the information contained in our public notices at any time, and will issue public notices to convey any new or supplemental information to applicants. It is the responsibility of all applicants to remain current with all Commission rules and with all public notices pertaining to this auction. Copies of most auctions-related Commission documents, including public notices, can be retrieved from the FCC Auctions Internet site at http://wireless.fcc.gov/auctions. Additionally, documents are available for public inspection and copying between 8:00 a.m. and 4:30 p.m. Eastern Time (ET) Monday through Thursday or 8:00 a.m. to 11:30 a.m. ET Fridays at the FCC Reference Information Center, 445 12th Street, SW, Room CY-A257, Washington, DC 20554. Documents may also be purchased from BCPI, the Commission’s duplicating contractor.15
To ensure the competitiveness of the auction process, section 1.2105(c) of the Commission’s rules prohibits auction applicants for licenses in any of the same or overlapping geographic license areas from communicating with each other about bids, bidding strategies, or settlements unless such applicants have identified each other on their short-form applications (FCC Form 175) as parties with whom they have entered into agreements pursuant to section 1.2105(a)(2)(viii).16
Section 1.2105(c)’s prohibition on certain communications will apply to any applicants that submit short-form applications seeking to participate in a Commission auction for licenses in the same or overlapping geographic license area. Thus, unless they have identified each other on their short-form applications as parties with whom they have entered into agreements under section 1.2105(a)(2)(viii), applicants for any of the same or overlapping geographic license areas must affirmatively avoid all communications with or disclosures to each other that affect or have the potential to affect bids or bidding strategy.17 In some instances, this prohibition extends to communications regarding the post-auction market structure. This prohibition applies to all applicants regardless of whether such applicants become qualified bidders or actually bid.18 13 See 47 C.F.R. Parts 22 and 90. 14 See 47 C.F.R. Part 1, Subpart I. 15 See note 10, above. When ordering documents from BCPI, please provide the appropriate FCC document number (for example, DA 13-60 for the Auction 95 Comment Public Notice, or DA 13-535 for this Public Notice). 16 See 47 C.F.R. §§ 1.2105(a)(2)(viii), 1.2105(c)(1); see also Part 1 Seventh Report and Order, 16 FCC Rcd at 17546. 17 See, e.g., Wireless Telecommunications Bureau Provides Guidance on the Anti-Collusion Rule for D, E and F Block Bidders, Public Notice, DA 96-1460, 11 FCC Rcd 10134 (1996). 18 See, e.g., Star Wireless, LLC, Forfeiture Order, DA 04-3026, 19 FCC Rcd 18626, 18628 ¶ 4 & n.19 (EB 2004), order granted in part sub nom, Star Wireless, LLC and Northeast Communications of Wisconsin, Inc., Order on Review, FCC 07-80, 22 FCC Rcd 8943 (2007)(“Star and Northeast Review Order”), petition for review denied, Star Wireless, LLC v. FCC, 522 F.3d 469 (D.C. Cir. 2008) (section 1.2105(c) applies to applicants regardless of whether they are qualified to bid); Letter to Robert Pettit, from Margaret W. Wiener, Chief, Auctions and Industry Analysis Division, DA 00-2905, 16 FCC Rcd 10080 (WTB 2000) (declining to exempt an applicant’s controlling interest from coverage by the communication prohibitions of section 1.2105(c), even though the applicant never made an upfront payment for the auction and was not listed as a qualified bidder). 5
Applicants are also reminded that, for purposes of this prohibition on certain communications, section 1.2105(c)(7)(i) defines “applicant” as including all officers and directors of the entity submitting a short-form application to participate in the auction, all controlling interests of that entity, 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 a short-form application.19 For example, where an individual served as an officer for two or more applicants, the Bureau has found that the bids and bidding strategies of one applicant are conveyed to the other applicant, and, absent a disclosed bidding agreement, an apparent violation of section 1.2105(c) occurs.20
As described in Section IV.A.2., below, information concerning applicants’ license selections will not be available to the public. Therefore, the Commission will inform each applicant by letter of the identity of each of the other applicants that has applied for licenses covering any of the same or overlapping geographic areas as the licenses that it has selected in its short-form application.21
Individuals and entities subject to section 1.2105(c) should take special care in circumstances where their employees may receive information directly or indirectly relating to anycompeting applicant’s bids or bidding strategies. The Bureau has not addressed a situation where non-principals (i.e., those who are not officers or directors, and thus not considered to be the applicant) receive information regarding a competing applicant’s bids or bidding strategies and whether that information should be presumed to be communicated to the applicant. 15.
An exception to the prohibition on certain communications allows non-controlling interest holders to obtain interests in more than one competing applicant without violating section 1.2105(c) provided specified conditions are met (including a certification that no prohibited communications have occurred or will occur), but that exception does not extend to controlling interest holders.22
Moreover, Auction 95 applicants selecting licenses for any of the same or overlapping geographic license areas are encouraged not to use the same individual as an authorized bidder. A violation of section 1.2105(c) could occur if an individual acts as the authorized bidder for two or more competing applicants, and conveys information concerning the substance of bids or bidding strategies between such applicants. Similarly, if the authorized bidders are different individuals employed by the same organization (e.g., law firm, engineering firm or consulting firm), a violation similarly could occur.23 In such a case, at a minimum, applicants should certify on their applications that precautionary 19 47 C.F.R. § 1.2105(c)(7)(i).20 See, e.g., Letter to Colby M. May, TCCSA, Inc., d/b/a Trinity Broadcasting Network, from Barbara A. Kreisman, Chief, Video Division, Media Bureau, and Margaret W. Wiener, Chief, Auctions and Spectrum Access Division, Wireless Telecommunications Bureau, DA 05-2445, 20 FCC Rcd 14648 (WTB/MB 2005) (“Trinity”) ( (finding apparent violation of communication prohibitions of section 1.2105(c) where applicants with mutually exclusive applications reported sharing same individual as an officer and director and reported having no bidding agreement).
21 Section IV.A.2. “Limited Information Disclosure Procedures: Information Available to Bidders Before and During the Auction,” below.
22 47 C.F.R. § 1.2105(c)(4). Specifically, the Commission’s rules permit a party holding a non-controlling, attributable interest in one applicant to acquire an ownership interest in or enter into a joint bidding arrangement with other applicants after the short-form application filing deadline, provided that: (i) the attributable interest holder certifies that it has not and will not communicate with any party concerning the bids or bidding strategies of more than one of the applicants in which it holds an attributable interest, or with which it has entered into a joint bidding arrangement; and (ii) the arrangements do not result in a change in control of any of the applicants. 47 C.F.R. §§1.2105(c)(4)(i), (ii).
23 See Application of Nevada Wireless, Memorandum Opinion and Order, DA 98-1137, 13 FCC Rcd 11973, 11977-78 ¶¶ 11-12 (1998) (“Nevada Wireless Order”).
steps have been taken to prevent communication between authorized bidders, and that the applicant and its bidders will comply with section 1.2105(c).24
Section 1.2105(c)’s prohibition on certain communications begins at the short-form application filing deadline and ends at the down payment deadline after the auction closes, which will be announced in a future public notice.25
Applicants must not communicate directly or indirectly about bids or bidding strategy to other applicants in this auction (as described above).26 Section 1.2105(c) prohibits not only communication about an applicant’s own bids or bidding strategy, it also prohibits communication of another applicant’s bids or bidding strategy.27 While section 1.2105(c) does not prohibit non-auction-related business negotiations among auction applicants, each applicant must remain vigilant so as not to directly or indirectly communicate information that affects, or could affect, bids, bidding strategy, or the negotiation of settlement agreements. 19.
Applicants are cautioned that the Commission remains vigilant about prohibited communications taking place in other situations. For example, the Commission has warned that prohibited “communications concerning bids and bidding strategies may include communications regarding capital calls or requests for additional funds in support of bids or bidding strategies to the extent such communications convey information concerning the bids and bidding strategies directly or indirectly.”28 Moreover, the Commission has found a violation of section 1.2105(c) where an applicant used the Commission’s bidding system to disclose “its bidding strategy in a manner that explicitly invited other auction participants to cooperate and collaborate in specific markets,”29 and has placed auction participants on notice that the use of its bidding system “to disclose market information to competitors will not be tolerated and will subject bidders to sanctions.”30 Applicants also should use caution in their dealings with other parties, such as members of the press, financial analysts, or others who might become conduits for the communication of prohibited bidding information. For example, where limited information disclosure procedures are in place, as in the case for Auction 95, an applicant’s statement to the press that it has lost bidding eligibility and intends to stop bidding in the auction could give rise to a finding of a section 1.2105(c) violation.31 Similarly, an applicant’s public statement of intent not to participate in Auction 95 bidding could also violate the rule. 24 Id.25 47 C.F.R. § 1.2105(c)(1).26 Part 1 Seventh Report and Order, 16 FCC Rcd at 17553-54 ¶ 12. For a discussion of the term “applicant” within the meaning of section 1.2105(c), see Section I.C.2.a. above.
In addition, when completing short-form applications, applicants should avoid any statements or disclosures that may violate section 1.2105(c), particularly in light of the limited information procedures in effect for Auction 95.33 Specifically, applicants should avoid including any information in their short-form applications that might convey information regarding their license selection, such as using applicant names that refer to licenses being offered, referring to certain licenses or markets in describing bidding agreements, or including any information in attachments that may otherwise disclose applicants’ license selections.
The Commission’s rules do not prohibit applicants from entering into otherwise lawful bidding agreements before filing their short-form applications, as long as they disclose the existence of the agreement(s) in their short-form applications.34 Applicants must identify in their short-form applications all parties with whom they have entered into any agreements, arrangements, or understandings of any kind relating to the licenses being auctioned, including any agreements relating to post-auction market structure.35 23.
If parties agree in principle on all material terms prior to the short-form application filing deadline, each party to the agreement must identify the other party or parties to the agreement on its short-form application under section 1.2105(c), even if the agreement has not been reduced to writing. If the parties have not agreed in principle by the short-form filing deadline, they should not include the names of parties to discussions on their applications, and they may not continue negotiation, discussion or communication with any other applicants after the short-form application filing deadline.36 24.
Section 1.2105(c) does not prohibit non-auction-related business negotiations among auction applicants.37 However, certain discussions or exchanges could touch upon impermissible subject matters because they may convey pricing information and bidding strategies. Such subject areas include, (Continued from previous page) collusion concerns. This has occurred in the antitrust context, where certain public statements can support other evidence which tends to indicate the existence of a conspiracy.”). 32 Thus, communication by an applicant of its license selections to another applicant for one or more of the same licenses, or communication of the fact that an applicant does or does not hold provisionally winning bids on particular licenses, may well violate 47 C.F.R. § 1.2105(c).
33 See Section IV.A.2. “Limited Information Disclosure Procedures: Information Available to Bidders Before and During the Auction,” below.
34 47 C.F.R. § 1.2105(c)(1).35 47 C.F.R. §§ 1.2105(a)(2)(viii), (c)(1).36 See Wireless Telecommunications Bureau Clarifies Spectrum Auction Anti-Collusion Rules, Public Notice, DA 95-2244, 11 FCC Rcd 9645, 9646 (WTB 1995) (“Anti-Collusion Public Notice”).
37 See, e.g., Todd Stuart Noordyk, Memorandum Opinion and Order, FCC 01-275, 16 FCC Rcd 18113, 18116-17 ¶ 12 (2001).
By electronically submitting a short-form application, each applicant in Auction 95 certifies its compliance with section 1.2105(c). In particular, an applicant must certify under penalty of perjury it has not entered and will not enter into any explicit or implicit agreements, arrangements or understandings of any kind with any parties, other than those identified in the application, regarding the amount of the applicant’s bids, bidding strategies, or the particular licenses on which it will or will not bid.39 However, the Bureau cautions that merely filing a certifying statement as part of an application will not outweigh specific evidence that a prohibited communication has occurred, nor will it preclude the initiation of an investigation when warranted.40 The Commission has stated that it “intend[s] to scrutinize carefully any instances in which bidding patterns suggest that collusion may be occurring.”41 Any applicant found to have violated section 1.2105(c) may be subject to sanctions.42
Section 1.2105(c)(6) provides that any applicant that makes or receives a communication that appears to violate section 1.2105(c) must report such communication in writing to the Commission immediately, and in no case later than five business days after the communication occurs.43 The Commission has clarified that each applicant’s obligation to report any such communication continues beyond the five-day period after the communication is made, even if the report is not made within the five-day period.44
In addition, section 1.65 of the Commission’s rules requires an applicant to maintain the accuracy and completeness of information furnished in its pending application and to notify the Commission of any substantial change that may be of decisional significance to that application.45 Thus, section 1.65 requires an auction applicant to notify the Commission of any substantial change to the information or certifications included in its pending short-form application. An applicant is therefore required by section 1.65 to report to the Commission any communication the applicant has made to or received from another applicant after the short-form application filing deadline that affects or has the potential to affect bids or bidding strategy, unless such communication is made to or received from a party to an agreement identified under section 1.2105(a)(2)(viii).46
Sections 1.65(a) and 1.2105(c) require each applicant in competitive bidding proceedings to furnish additional or corrected information within five days of a significant occurrence, or to amend its 38 See Amendment of Part 1 of the Commission's Rules – Competitive Bidding Procedures, WT Docket No. 97-82, Third Report and Order and Second Further Notice of Proposed Rule Making, FCC 97-413, 13 FCC Rcd 374, 467-68 ¶ 163 (1997) (“Part 1 Third Report and Order”).
39 47 C.F.R. § 1.2105(a)(2)(ix).40 Nevada Wireless Order, 13 FCC Rcd at 11978 ¶ 13.41 Competitive Bidding Memorandum Opinion and Order, 9 FCC Rcd at 7689 ¶ 12. 42 See 47 C.F.R. §§ 1.2105(c), 1.2107(d), and 1.2109(d). 43 47 C.F.R. § 1.2105(c)(6); see also Part 1 Seventh Report and Order, 16 FCC Rcd at 17553-55 ¶¶ 13-17.44 See Service Rules for the 698-746, 747-762 and 777-792 MHz Bands, WT Docket No. 06-150, Second Report and Order, FCC 07-132, 22 FCC Rcd 15,289, 15,395 ¶¶ 285-86 (2007).
45 47 C.F.R. § 1.65; see also Part 1 Seventh Report and Order, 16 FCC Rcd at 17550-51 ¶ 9.46 See Part 1 Seventh Report and Order, 16 FCC Rcd at 17550-51 ¶ 9.
Procedure for Reporting Prohibited Communications 29.
A party reporting any communication pursuant to sections 1.65, 1.2105(a)(2), or 1.2105(c)(6) must take care to ensure that any report of a prohibited communication does not itself give rise to a violation of section 1.2105(c). For example, a party’s report of a prohibited communication could violate the rule by communicating prohibited information to other applicants through the use of Commission filing procedures that would allow such materials to be made available for public inspection. 30.
Section 1.2105(c) requires parties to file only a single report concerning a prohibited communication and to file that report with Commission personnel expressly charged with administering the Commission’s auctions.49 This rule is designed to minimize the risk of inadvertent dissemination of information in such reports. Any reports required by section 1.2105(c) must be filed consistent with the instructions set forth in this Public Notice.50 For Auction 95, such reports must be filed with the Chief of the Auctions and Spectrum Access Division, Wireless Telecommunications Bureau, by the most expeditious means available. Any such report should be submitted by e-mail to Ms. Wiener at the following e-mail address: auction95@fcc.gov. If you choose instead to submit a report in hard copy, any such report must be delivered only to: Margaret W. Wiener, Chief, Auctions and Spectrum Access Division, Wireless Telecommunications Bureau, Federal Communications Commission, 445 12th Street, SW, Room 6423, Washington, DC 20554.
A party seeking to report such a prohibited communication should consider submitting its report with a request that the report or portions of the submission be withheld from public inspection by following the procedures specified in section 0.459 of the Commission’s rules.51 Such parties also are encouraged to coordinate with the Auctions and Spectrum Access Division staff about the procedures for submitting such reports.52 This Public Notice provides additional guidance on procedures for submitting application-related information below.53
47 Procedural Amendments to Commission Part 1 Competitive Bidding Rules, WT Docket No. 10-18, Order, FCC 10-4, 25 FCC Rcd 521, 523 ¶ 8 (2010) (“Part 1 Procedural Amendments Order”). 48 Id.49 Part 1 Procedural Amendments Order, 25 FCC Rcd at 522 ¶ 4. This process differs from filing procedures used in connection with other Commission rules and processes which may call for submission of filings to the Commission’s Office of the Secretary or ECFS. Filing through the Office of Secretary or ECFS could allow the report to become publicly available and might result in the communication of prohibited information to other auction applicants.
50 Id.51 See 47 C.F.R. § 0.459 (requests that materials or information submitted to the Commission be withheld from public inspection). Filers requesting confidential treatment of documents must be sure that the cover page of the filing prominently displays that the documents seek confidential treatment. For example, a filing might include a cover page stamped with “Request for Confidential Treatment Attached” or “Not for Public Inspection.” Any such request must cover all of the material to which the request applies. See 47 C.F.R. § 0.459 (a). 52 See Section VI. “Contact Information,” below.53 See Section II. J. “Maintaining Current Information in Short-Form Applications,” below.
Each applicant that is a winning bidder will be required to disclose in its long-form applications the specific terms, conditions, and parties involved in any agreement it has entered into. This applies to any bidding consortia, joint venture, partnership, or agreement, understanding, or other arrangement entered into relating to the competitive bidding process, including any agreement relating to the post-auction market structure.54 Failure to comply with the Commission’s rules can result in enforcement action.
A summary listing of documents issued by the Commission and the Bureau addressing the application of section 1.2105(c) may be found in Attachment E. These documents are available on the Commission’s auction web page at http://wireless.fcc.gov/auctions/prohibited_communications. j.
Regardless of compliance with the Commission’s rules, applicants remain subject to the antitrust laws, which are designed to prevent anticompetitive behavior in the marketplace.55 Compliance with the disclosure requirements of section 1.2105(c) will not insulate a party from enforcement of the antitrust laws.56 For instance, a violation of the antitrust laws could arise out of actions taking place well before any party submitted a short-form application.57 The Commission has cited a number of examples of potentially anticompetitive actions that would be prohibited under antitrust laws: for example, actual or potential competitors may not agree to divide territories in order to minimize competition, regardless of whether they split a market in which they both do business, or whether they merely reserve one market for one and another market for the other.58 Similarly, the Bureau previously reminded potential applicants and others that “[e]ven where the applicant discloses parties with whom it has reached an agreement on the short-form application, thereby permitting discussions with those parties, the applicant is nevertheless subject to existing antitrust laws.”59
To the extent the Commission becomes aware of specific allegations that suggest that violations of the federal antitrust laws may have occurred, the Commission may refer such allegations to the United States Department of Justice for investigation.60 If an applicant is found to have violated the antitrust laws or the Commission’s rules in connection with its participation in the competitive bidding 54 47 C.F.R. § 1.2107(d).55 See Amendment of Part 1 of the Commission's Rules – Competitive Bidding Procedures, WT Docket No. 97-82, Third Further Notice of Proposed Rulemaking, FCC 99-384, 14 FCC Rcd 21558, 21560-61 ¶ 4 & n.17 (1999) quoting Competitive Bidding Memorandum Opinion and Order, 9 FCC Rcd at 7689 ¶ 12 (“[W]e wish to emphasize that all applicants and their owners continue to be subject to existing antitrust laws. Applicants should note that conduct that is permissible under the Commission's Rules may be prohibited by the antitrust laws.”); Implementation of Section 309(j) of the Communications Act – Competitive Bidding, PP Docket No. 93-253, Fourth Memorandum Opinion and Order, FCC 94-264, 9 FCC Rcd 6858, 6869 n.134 (1994)(“[A]pplicants will also be subject to existing antitrust laws.”) (“Fourth Memorandum Opinion and Order”). 56 See Competitive Bidding Memorandum Opinion and Order, 9 FCC Rcd at 7689 ¶ 12. See also “Justice Department Sues Three Firms Over FCC Auction Practices,” Press Release 98-536 (DOJ Nov. 10, 1998). 57 See, e.g., Fourth Memorandum Opinion and Order, 9 FCC Rcd at 6869 n.134. 58 Id. See also Competitive Bidding Second Report and Order, 9 FCC Rcd at 2387 n.165.59 Anti-Collusion Public Notice, 11 FCC Rcd at 9646.60 See Competitive Bidding Second Report and Order, 9 FCC Rcd at 2388 ¶ 226. 11
There are pre-existing paging incumbent licenses, including public safety entities licensed under either section 337 of the Communications Act, as amended, or section 1.925 of the Commission's rules.62 Incumbent (non-geographic) paging licensees operating under their existing authorizations are entitled to full protection from co-channel interference.63 Geographic area licensees are likewise afforded co-channel interference protection from incumbent licensees.64 Geographic area licensees are obligated to resolve possible interference concerns of adjacent geographic area licensees by negotiating a mutually acceptable agreement with the neighboring geographic licensee.65 Incumbency issues are further discussed below.
Potential bidders seeking licenses for geographic areas adjacent to the Canadian and Mexican border should be aware that the use of some or all of the channels they acquire in the auction could be restricted as a result of current or future agreements with Canada or Mexico.66 Licensees on the lower paging channels must submit a FCC Form 601 to obtain authorization to operate stations north of Line A or east of Line C because these channels are subject to the Above 30 Megacycles per Second Agreement with Industry Canada.67 Although the upper paging channels do not require coordination with Canada, the U.S.-Canada Interim Coordination Considerations for the Band 929-932 MHz, as amended, assigns specific 929 MHz and 931 MHz frequencies to the United States for licensing along certain longitudes above Line A, and assigns other specific 929 MHz and 931 MHz frequencies to Canada for licensing along certain longitudes along the U.S.-Canada border. In addition, the 929 MHz and 931 MHz frequencies assigned to Canada are unavailable for use by U.S. licensees above Line A as set out in the agreement.68
Paging licensees must individually apply for and receive a separate license for each transmitter if the proposed operation would affect the radio quiet zones set forth in the Commission’s rules.69
61 See 47 C.F.R. § 1.2109(d); see also Competitive Bidding Second Report and Order, 9 FCC Rcd at 2388 ¶ 226.62 47 U.S.C. § 337; 47 C.F.R. § 1.925 (waiver standard).63 Paging Reconsideration Order at 10059-60 ¶¶ 42-44. See also Paging Second Report and Order, 12 FCC Rcd at 2764 ¶¶ 57-58; 47 C.F.R. § 22.503(i).
64 Paging Second Report and Order at 2764 ¶ 57.65 Paging Reconsideration Order, 14 FCC Rcd at 10060-61 ¶¶ 45-46. 66 See Coordination and Use of Radio Frequencies Above 30 Megacycles per Second, October 24, 1962, as amended, June 24, 1965, U.S.-Canada; February 27, 1997 “Protocol Concerning Use of the 929-930 MHz and 931-932 MHz Bands for Paging Services along the Common Border” with Mexico for paging services using 929-932 MHz spectrum within 120 kilometers (75 miles) of the common border.
67 Canada Telecommunication: Coordination and Use of Radio Frequencies Above 30 Megacycles per Second, October 24, 1962, as amended, June 24, 1965, U.S.-Canada.
68 See 47 C.F.R. § 22.531(e) (limiting availability of UHF channels in the Canadian border region). 69 47 C.F.R. § 1.924.
Potential bidders are reminded that there are a number of incumbent licensees already licensed and operating on frequencies that will be subject to the upcoming auction. Geographic area licensees in accordance with the Commission’s rules must protect such incumbents from harmful interference.70 These limitations may restrict the ability of such geographic area licensees to use certain portions of the electromagnetic spectrum or provide service to certain areas in their geographic license areas.
We caution potential applicants formulating their bidding strategies to investigate and consider the extent to which these frequencies are occupied. For example, as stated above, there are incumbent operations already licensed and operating in the bands that must be protected. These limitations may restrict the ability of paging licensees to use certain portions of the electromagnetic spectrum or provide service to certain areas in their geographic license areas. Bidders should become familiar with the status of these operations and applicable Commission rules, orders and any pending proceedings related to the service, in order to make reasoned, appropriate decisions about their participation in this auction and their bidding strategy.
We remind each potential bidder that it is solely responsible for investigating and evaluating all technical and marketplace factors that may have a bearing on the value of the licenses they are seeking in this auction. Each bidder is responsible for assuring that, if it wins a license, it will be able to build and operate facilities in accordance with the Commission’s rules. The FCC makes no representations or warranties about the use of this spectrum for particular services. Applicants should be aware that an FCC auction represents an opportunity to become an FCC licensee subject to certain conditions and regulations. An FCC auction does not constitute an endorsement by the FCC of any particular service, technology, or product, nor does an FCC license constitute a guarantee of business success. 42.
An applicant should perform its due diligence research and analysis before proceeding, as it would with any new business venture. In particular, the Bureau strongly encourages each potential bidder to review all Commission orders establishing rules and policies for the lower and upper paging bands.71 Additionally, each potential bidder should perform technical analyses or refresh their previous analyses to assure itself that, should it become a winning bidder for any Auction 95 license, it will be able to build and operate facilities that will fully comply with all applicable technical and legal requirements. The Bureau strongly encourages each applicant to inspect any prospective transmitter sites located in, or near, the service area for which it plans to bid, confirm the availability of such sites, and to familiarize itself with the Commission’s rules regarding the National Environmental Policy Act.72
The Bureau strongly encourages each applicant to conduct its own research prior to Auction 95 in order to determine the existence of pending administrative or judicial proceedings, including pending allocation rulemaking proceedings, that might affect its decision to participate in the auction. The Bureau strongly encourages each participant in Auction 95 to continue such research throughout the auction. The due diligence considerations mentioned in this Public Notice do not comprise an exhaustive list of steps that should be undertaken prior to participating in this auction. As always, the burden is on the potential bidder to determine how much research to undertake, depending upon specific facts and circumstances related to its interests. 44.
The Bureau also reminds each applicant that pending and future judicial proceedings, as well as pending and future proceedings before the Commission — including applications, applications for 70 See 47 C.F.R. § 22.503(i).71 See, e.g., authorities cited at note 2, above. 72 47 C.F.R. Chapter 1, Part 1, Subpart I.
modification, petitions for rulemaking, requests for special temporary authority, waiver requests, petitions to deny, petitions for reconsideration, informal objections, and applications for review — may relate to particular applicants, incumbent licensees, or the licenses available in Auction 95. Each prospective applicant is responsible for assessing the likelihood of the various possible outcomes and for considering the potential impact on licenses available in this auction.
Applicants are solely responsible for identifying associated risks and for investigating and evaluating the degree to which such matters may affect their ability to bid on, otherwise acquire, or make use of the licenses available in Auction 95. Each potential bidder is responsible for undertaking research to ensure that any licenses won in this auction will be suitable for its business plans and needs. Each potential bidder must undertake its own assessment of the relevance and importance of information gathered as part of its due diligence efforts. 46.
Applicants may research the Bureau’s licensing database in order to determine which frequencies are already licensed to incumbent licensees. Applicants may obtain information about licenses available in Auction 95 through the Bureau’s online licensing databases at http://wireless.fcc.gov/uls. Potential bidders may query the database online and download a copy of their search results if desired. Instructions on using License Search (including frequency searches and the GeoSearch capability) and downloading query results are also available online by selecting the “?” button at the upper right-hand corner of the “License Search” screen or by going to the Universal Licensing System (“ULS”) support site at http://esupport.fcc.gov/licensing.htm. Potential bidders should direct questions regarding the search capabilities of ULS to the FCC ULS Technical Support hotline at (877) 480-3201, option two. The hotline is available to assist with questions Monday through Friday, from 8:00 a.m. to 6:00 p.m. ET. In order to provide better service to the public, all calls to the hotline are recorded.
The Commission makes no representations or guarantees regarding the accuracy or completeness of information in its databases or any third party databases, including, for example, court docketing systems. To the extent the Commission’s databases may not include all information deemed necessary or desirable by an applicant, it must obtain or verify such information from independent sources or assume the risk of any incompleteness or inaccuracy in said databases. Furthermore, the Commission makes no representations or guarantees regarding the accuracy or completeness of information that has been provided by incumbent licensees and incorporated into its databases. 5.
Bidders will be able to participate in Auction 95 over the Internet using the Commission’s web-based Integrated Spectrum Auction System (“ISAS” or “FCC Auction System”). The Commission makes no warranty whatsoever with respect to the FCC Auction System. In no event shall the Commission, or any of its officers, employees, or agents, be liable for any damages whatsoever (including, but not limited to, loss of business profits, business interruption, loss of business information, or any other loss) arising out of or relating to the existence, furnishing, functioning, or use of the FCC Auction System that is accessible to qualified bidders in connection with this auction. Moreover, no obligation or liability will arise out of the Commission’s technical, programming, or other advice or service provided in connection with the FCC Auction System. 6.
As is the case with many business investment opportunities, some unscrupulous entrepreneurs may attempt to use Auction 95 to deceive and defraud unsuspecting investors. Common warning signals of fraud include the following:
Licensees must comply with the Commission’s rules regarding implementation of the National Environmental Policy Act and other federal environmental statutes.73 The construction of a wireless antenna facility is a federal action, and the licensee must comply with the Commission’s environmental rules for each such facility.74 These environmental rules require, among other things, that the licensee consult with expert agencies having environmental responsibilities, including the U.S. Fish and Wildlife Service, the State Historic Preservation Office, the U.S. Army Corps of Engineers, and the Federal Emergency Management Agency (through the local authority with jurisdiction over floodplains). In assessing the effect of facility construction on historic properties, the licensee must follow the provisions of the FCC’s Nationwide Programmatic Agreement Regarding the Section 106 National Historic Preservation Act Review Process.75 The licensee must prepare environmental assessments for any facility that may have a significant impact in or on wilderness areas, wildlife preserves, threatened or endangered species, or designated critical habitats, historical or archaeological sites, Indian religious sites, floodplains, and surface features. In addition, the licensee must prepare environmental assessments for facilities that include high intensity white lights in residential neighborhoods or excessive radio frequency emission.
73 47 C.F.R. Chapter 1, Part 1, Subpart I.74 47 C.F.R. §§ 1.1301-1.1319.75 47 C.F.R. Part 1, Appendix C. 15
Bidding in Auction 95 will begin on Tuesday, July 16, 2013. Pre-auction dates and deadlines are listed below. 53.
Auction 95 – Lower and Upper Paging Bands
As discussed in more detail below, the bidding methodology for Auction 95 will be a simultaneous multiple round format.76 The Commission will conduct this auction over the Internet using the FCC Auction System. Qualified bidders are permitted to bid electronically via the Internet or by telephone using the telephonic bidding option. All telephone calls are recorded.
Pre-Auction Dates and Deadlines<