[Federal Register Volume 73, Number 90 (Thursday, May 8, 2008)]
[Notices]
[Pages 26112-26118]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-10381]
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FEDERAL COMMUNICATIONS COMMISSION
[AU Docket No. 08-32; Report No. AUC-08-77-B (Auction 77); DA 08-926]
Closed Auction of Licenses For Cellular Unserved Service Areas
Scheduled for June 17, 2008; Notice and Filing Requirements, Minimum
Opening Bids, Upfront Payments and Other Procedures for Auction 77
AGENCY: Federal Communications Commission.
ACTION: Notice.
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SUMMARY: This document announces the procedures and minimum opening
bids for the upcoming Closed Auction of Licenses for Cellular Unserved
Service Areas (Auction 77). This document is intended to familiarize
prospective
[[Page 26113]]
bidders with the procedures and minimum opening bids for the auction.
DATES: Short Form Applications to participate in Auction 77 must be
filed before 6 p.m. ET on May 14, 2008. The upfront payments deadline
for Auction 77 is June, 2, 2008, 6 p.m. ET. Bidding for Auction No. 77
is scheduled to begin on June 17, 2008.
FOR FURTHER INFORMATION CONTACT: Wireless Telecommunications Bureau,
Auctions Spectrum and Access Division: For legal questions: Sayuri
Rajapakse at (202) 418-0660. For general auction questions: Barbara
Sibert at (717) 338-2868. Mobility Division: For service rule
questions: Erin McGrath (legal), Gabriel Ubieta (engineering) and
Denise Walter (licensing) at (202) 418-0620. To request materials in
accessible formats (Braille, large print, electronic files or audio
format) for people with disabilities, send an e-mail to [email protected]
or call the Consumer and Governmental Affairs Bureau at (202) 418-0530
or (202) 418-0432 (TTY).
SUPPLEMENTARY INFORMATION: This is a summary of the Auction 77
Procedures Public Notice which was released on April 25, 2008. The
complete text of the Auction 77 Procedures Public Notice, including
attachments, as well as related Commission documents are available for
public inspection and copying at the FCC Reference Information Center.
The Auction 77 Procedures Public Notice and related Commission
documents may also be purchased from the Commission's duplicating
contractor, Best Copy and Printing, Inc. (BCPI), Portals II, 445 12th
Street, SW., Room CY-B402, Washington, DC 20554, telephone 202-488-
5300, facsimile 202-488-5563, or Web site: http://www.BCPIWEB.com. The
Auction 77 Procedures Public Notice and related documents are also
available on the Internet at the Commission's Web site: http://wireless.fcc.gov/auctions/77/.
I. General Information
A. Introduction
1. The Wireless Telecommunications Bureau (Bureau) announces the
procedures and minimum opening bid amounts for the upcoming closed
auction of Cellular Radiotelephone Service licenses covering two
different unserved areas (Auction 77). Auction 77 is scheduled to begin
on June 17, 2008.
i. Background of Proceeding
2. On March 21, 2008, in accordance with Section 309(j)(3) of the
Communications Act of 1934, as amended, the Bureau released a public
notice seeking comment on competitive bidding procedures to be used in
Auction 77. In the Auction 77 Comment Public Notice, 73 FR 18276, April
3, 2008, the Bureau proposed to award the licenses using a single-round
sealed-bid auction and sought comment on procedures for the conduct of
Auction 77. The Bureau received one comment and no reply comments in
response to the Auction 77 Comment Public Notice.
ii. Licenses To Be Offered in Auction 77
3. The spectrum to be auctioned is the subject of two groups of
pending mutually exclusive long-form applications (FCC Form 601s) for
unserved area licenses in the Cellular Radiotelephone Service.
Participation in Auction 77 will be limited to those applicants
identified in Attachment A of the Auction 77 Procedures Public Notice.
Licenses will be auctioned for each mutually exclusive applicant group
(MX group) identified in Attachment A. The winning bidder in each group
will be licensed to serve only the unserved area proposed in its long-
form application(s) for that MX group.
4. Consistent with the Commission's determination in the
Competitive Bidding Ninth Report and Order, 61 FR 58333, November 14,
1996, all pending mutually exclusive applications for unserved area
licenses in the Cellular Radiotelephone Service must be resolved
through a system of competitive bidding. When the short-form
applications of two or more applicants within an MX group are accepted
for filing, mutual exclusivity exists for auction purposes. Once mutual
exclusivity exists for auction purposes, even if only one applicant
within an MX group submits an upfront payment, that applicant is
required to submit a bid in order to obtain the license. Any applicant
that submits a short-form application but fails to timely submit an
upfront payment will not be eligible to bid.
B. Rules and Disclaimers
i. Relevant Authority
5. Prospective applicants must familiarize themselves thoroughly
with the Commission's general competitive bidding rules set forth in 47
CFR part 1 and 22 including recent amendments and clarifications; rules
relating to the Cellular Radiotelephone Service and rules relating to
applications, environment, practice and procedure. Prospective
applicants must also be thoroughly familiar with the procedures, terms
and conditions (collectively, terms) contained in the Auction 77
Procedures Public Notice and the Commission's decisions in proceedings
regarding competitive bidding procedures, application requirements, and
obligations of Commission licensees.
6. 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 its 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 Auction 77.
ii. Prohibition of Collusion; Compliance With Antitrust Laws
7. To ensure the competitiveness of the auction process, 47 CFR
1.2105(c) of the Commission's rules prohibits auction applicants for
licenses in any of the same 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 Forms 175) as parties with whom they have entered
into agreements pursuant to 47 CFR 1.2105(a)(2)(viii). This prohibition
applies to all applicants regardless of whether such applicants become
qualified bidders or actually bid. Section 1.2105(c)'s anti-collusion
prohibition begins at the short-form application filing deadline and
ends at the down payment deadline after the auction. If an applicant
makes or receives a communication that appears to violate the anti-
collusion rule, it must report such communication in writing to the
Commission immediately and in no case later than five business days
after the communication occurs. The Auction 77 Procedures Public Notice
contains specific guidance for applicants on the applicability of and
compliance with the Commission's anti-collusion rule and antitrust
laws. A summary listing of documents issued by the Commission and the
Bureau addressing the application of the anti-collusion rule may be
found in Attachment D of the Auction 77 Procedures Public Notice.
iii. Due Diligence
8. The FCC makes no representations or warranties about the use of
this spectrum for particular services. Applicants should perform their
individual due diligence before proceeding as they would with any new
business venture.
9. Potential bidders are strongly encouraged to conduct their own
[[Page 26114]]
research prior to the beginning of bidding in Auction 77 in order to
determine the existence of any pending legislative, administrative or
judicial proceedings that might affect their decision regarding
participation in the auction. Participants in Auction 77 are strongly
encouraged to continue such research throughout the auction. In
addition, potential bidders should perform technical analyses
sufficient to assure themselves that, should they prevail in
competitive bidding for a specific license, they will be able to build
and operate facilities that will fully comply with the Commission's
technical and legal requirements as well as other applicable Federal,
state, and local laws.
10. Applicants should perform due diligence to identify and
consider all proceedings that may affect the spectrum licenses being
auctioned and that could have an impact on the availability of spectrum
for Auction 77. In addition, although the Commission may continue to
act on various pending applications, informal objections, petitions,
and other requests for Commission relief, some of these matters may not
be resolved by the beginning of bidding in the auction.
11. 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 licenses being offered.
iv. Use of Integrated Spectrum Auction System
12. The Commission will make available a browser-based bidding
system to allow bidders to participate in Auction 77 over the Internet
using the Commission's 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 Auction 77. 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.
C. Auction Specifics
i. Auction 77 Start Date
13. Bidding in Auction 77 will be held on Tuesday, June 17, 2008.
Unless otherwise announced, the licenses to provide cellular service in
the two different unserved areas will be offered at the same time.
14. The start and finish time of bidding will be announced by
public notice approximately ten days before the start of the auction.
ii. Bidding Methodology
15. The bidding methodology for Auction 77 will be single-round
sealed-bid. The single-round sealed-bid format will consist of one
bidding round followed by the release of auction results. In the event
of tied bids in an MX group, the Commission will post an announcement
in the FCC Auction System to announce an additional round of bidding
for that MX group. The Commission will conduct Auction 77 over the
Internet using the FCC Auction System, and telephonic bidding will be
available as well. All telephone calls are recorded.
iii. Pre-Auction Dates and Deadlines
16. The following dates and deadlines apply:
Auction 77 Short-Form Application (FCC Form 175) Filing Window Opens--
May 14, 2008; 9 a.m. ET.
Auction 77 Short-Form Application (FCC Form 175) Filing Window
Deadline--May 16, 2008; prior to 6 p.m. ET.
Auction 77 Upfront Payment Deadline (via wire transfer)--June 2, 2008;
6 p.m. ET.
Auction 77 Begins--June 17, 2008.
iv. Requirements for Participation in Auction 77
17. Those wishing to participate in Auction 77 must: (1) Submit a
short-form application (FCC Form 175) electronically prior to 6 p.m.
ET, May 16, 2008, following the electronic filing procedures set forth
in Attachment B of the Auction 77 Procedures Public Notice; (2) submit
a sufficient upfront payment and an FCC Remittance Advice Form (FCC
Form 159) by 6 p.m. ET, June 2, 2008, following the procedures and
instructions set forth in Attachment C of the Auction 77 Procedures
Public Notice; and (3) comply with all provisions outlined in the
Auction 77 Procedures Public Notice and applicable Commission rules.
II. Short-Form Application (FCC Form 175) Requirements
18. Entities seeking licenses available in Auction 77 must file a
short-form application (FCC Form 175) electronically following the
procedures prescribed in Attachment B of the Auction 77 Procedures
Public Notice. Applicants filing a short-form application are subject
to the Commission's anti-collusion rules beginning on the deadline for
filing. Applicants bear full responsibility for submitting accurate,
complete and timely short-form applications. All applicants must
certify on their short-form applications under penalty of perjury that
they are legally, technically, financially and otherwise qualified to
hold a license. Applicants should read the instructions set forth in
Attachment B of the Auction 77 Procedures Public Notice carefully and
should consult the Commission's rules to ensure that all the
information that is required under the Commission's rules is included
with their short-form applications.
19. An entity may not submit more than one short-form application
for Auction 77. If a party submits multiple short-form applications for
Auction 77, only one application will be accepted for filing.
20. Applicants also should note that submission of a short-form
application (and any amendments thereto) constitutes a representation
by the certifying official that he or she is an authorized
representative of the applicant, that he or she has read the form's
instructions and certifications, and that the contents of the
application, its certifications, and any attachments are true and
correct. Applicants are not permitted to make major modifications to
their applications; such impermissible changes include a change of the
certifying official to the application. Submission of a false
certification to the Commission may result in penalties, including
monetary forfeitures, license forfeitures, ineligibility to participate
in future auctions, and/or criminal prosecution.
A. License Selection
21. On its short-form application for Auction 77, an applicant must
select the license for which it has filed a long-form application.
Applicants will not be able to select the license for which they have
not filed a long-form application.
22. Applicants will not be able to change their license selections
after the short-form application filing deadline. Applicants interested
in participating in Auction 77 must have selected license(s) available
in the respective
[[Page 26115]]
auction by the short-form application deadline. Applicants must confirm
their license selections before the deadline for submitting FCC Form
175. The FCC Auction System will not accept bids from an applicant on
individual licenses that the applicant has not selected on its FCC Form
175.
B. Disclosure of Bidding Arrangements
23. Applicants will be required to identify in their short-form
application for Auction 77 all parties with whom they have entered into
any agreements, arrangements, or understandings of any kind relating to
the licenses being auctioned in Auction 77, including any agreements
relating to post-auction market structure.
24. Applicants also will be required to certify under penalty of
perjury in their short-form applications that they have 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 to participate in Auction 77 regarding
the amount of their bids, bidding strategies, or the particular
licenses on which they will or will not bid. If an applicant has had
discussions, but has not reached an agreement by the short-form
application filing deadline, it would not include the names of parties
to the discussions on its application and may not continue such
discussions with any applicants after the deadline.
C. Ownership Disclosure Requirements
25. All applicants must comply with the uniform part 1 ownership
disclosure standards and provide information required by 47 CFR 1.2105
and 1.2112 of the Commission's rules. Specifically, in completing the
short-form application for Auction 77, applicants will be required to
fully disclose information on the real party or parties-in-interest and
ownership structure of the applicant. The ownership disclosure
standards for the short-form application are prescribed in 47 CFR
1.2105 and 1.2112 of the Commission's rules. Each applicant is
responsible for information submitted in its short-form application
being complete and accurate.
D. Provisions Regarding Former and Current Defaulters
26. Each applicant must state under penalty of perjury on its
short-form application whether or not the applicant, its affiliates,
its controlling interests, and the affiliates of its controlling
interests, as defined by 47 CFR 1.2110, have ever been in default on
any Commission licenses or have ever been delinquent on any non-tax
debt owed to any Federal agency. In addition, each applicant must
certify under penalty of perjury on its short-form application that, as
of the short-form filing deadline, the applicant, its affiliates, its
controlling interests, and the affiliates of its controlling interests,
as defined by 47 CFR 1.2110, are not in default on any payment for
Commission licenses (including down payments) and that they are not
delinquent on any non-tax debt owed to any Federal agency. Prospective
applicants are reminded that submission of a false certification to the
Commission is a serious matter that may result in severe penalties,
including monetary forfeitures, license revocations, exclusion from
participation in future auctions, and/or criminal prosecution. These
statements and certifications are prerequisites to submitting an
application in the FCC Auction System.
27. Former defaulters--i.e., applicants, including any of their
affiliates, any of their controlling interests, or any of the
affiliates of their controlling interests, that in the past have
defaulted on any Commission licenses or been delinquent on any non-tax
debt owed to any Federal agency, but that have since remedied all such
defaults and cured all of their outstanding non-tax delinquencies--are
eligible to bid in Auction 77, provided that they are otherwise
qualified. However, former defaulters are required to pay upfront
payments that are fifty percent more than the normal upfront payment
amounts.
28. Current defaulters--i.e., applicants, including any of their
affiliates, any of their controlling interests, or any of the
affiliates of their controlling interests, that are in default on any
payment for any Commission licenses (including down payments) or are
delinquent on any non-tax debt owed to any Federal agency as of the
filing deadline for short-form applications--are not eligible to bid in
Auction 77.
29. Applicants are encouraged to review the Bureau's previous
guidance on default and delinquency disclosure requirements in the
context of the short-form application process.
E. Minor Modifications to Short-Form Applications (FCC Form 175)
30. Applicants are not permitted to make major modifications to
their short-form applications (e.g., change their license selections,
change control of the applicant, or change the certifying official)
after the short-form application deadline. Thus, any change in control
of an applicant, resulting from a merger for example, will be
considered a major modification to the applicant's FCC Form 175, which
will consequently be dismissed.
31. Applicants are, however, permitted to make only minor changes
to their FCC Form 175 after the short-form application deadline.
Permissible minor changes include, for example, deletion and addition
of authorized bidders (to a maximum of three) and revision of addresses
and telephone numbers of the applicants and their contact persons.
32. The Auction 77 Procedures Public Notice also provides
information on the mechanics of making permissible minor changes to its
short-form application.
F. Maintaining Current Information in Short-Form Applications (FCC Form
175)
33. 47 CFR 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 within 30 days of any
substantial change that may be of decisional significance to that
application. If an amendment reporting substantial changes is a major
amendment as defined by 47 CFR 1.2105, the major amendment will not be
accepted and may result in the dismissal of the short-form application.
34. The Auction 77 Procedures Public Notice contains instructions
on how to make minor changes to their short-form applications.
III. Pre-Auction Procedures
A. Short-Form Applications (FCC Form 175)--Due Prior to 6 p.m. ET on
May 16, 2008
35. In order to be eligible to bid in Auction 77, applicants must
first follow the procedures set forth in Attachment B of the Auction 77
Procedures Public Notice to submit an FCC Form 175 application
electronically via the FCC Auction System. This application must be
received at the Commission prior to 6 p.m. ET on May 16, 2008. Late
applications will not be accepted. There is no application fee required
when filing an FCC Form 175, but an applicant must submit an upfront
payment to be eligible to bid.
36. Applications may generally be filed at any time beginning at 9
a.m. ET on May 14, 2008, and the filing window will close prior to 6
p.m. ET on May 16, 2008. Applicants are strongly encouraged to file
early and are responsible for allowing adequate time for filing their
applications. Applicants may update or amend their applications
multiple times until the filing deadline
[[Page 26116]]
on May 16, 2008. Applicants must always click on the SUBMIT button on
the Certify & Submit screen of the electronic form to successfully
submit or modify their FCC Form 175.
Application Processing and Minor Corrections
37. After the deadline for filing short-form applications, the
Commission will process all timely submitted applications to determine
which are complete, and subsequently will issue a public notice
identifying: (1) Those applications that are complete; (2) those
applications rejected; and (3) those applications that are incomplete
because of minor defects that may be corrected, and the deadline for
resubmitting corrected applications.
B. Upfront Payments--Due June 2, 2008
38. In order to be eligible to bid in Auction 77, applicants must
submit an upfront payment accompanied by an FCC Remittance Advice Form
(FCC Form 159). After completing the FCC Form 175, filers will have
access to an electronic version of the FCC Form 159 that can be printed
and sent by facsimile to Mellon Bank in Pittsburgh, PA. All upfront
payments for Auction 77 must be received in the proper account at
Mellon Bank by 6 p.m. ET on June 2, 2008. The Auction 77 Procedures
Public Notice contains instructions for using wire transfers to meet
the upfront payment requirements.
39. Please note that: (1) All payments must be made in U.S.
dollars; (2) all payments must be made by wire transfer; (3) upfront
payments for Auction 77 go to a lockbox number different from the
lockboxes used in previous FCC auctions, and different from the lockbox
number to be used for post-auction payments; and (4) failure to deliver
the upfront payment as instructed by the June 2, 2008, deadline will
result in dismissal of the application and disqualification from
participation in the auction.
i. FCC Form 159
40. A completed FCC Remittance Advice Form (FCC Form 159, Revised
7/05) must be sent by facsimile to Mellon Bank to accompany each
upfront payment. Proper completion of FCC Form 159 (Revised 7/05) is
critical to ensuring correct crediting of upfront payments. Detailed
instructions for completion of FCC Form 159 are included in Attachment
C to this Public Notice. An electronic pre-filled version of the FCC
Form 159 is available after submitting the FCC Form 175. Payors using a
pre-filled FCC Form 159 are responsible for ensuring that all of the
information on the form, including payment amounts, is accurate. The
FCC Form 159 can be completed electronically, but must be filed with
Mellon Bank via facsimile.
ii. Upfront Payments and Bidding Eligibility
41. Applicants must make the required upfront payment in order to
be able to bid in Auction 77.
42. In the Auction 77 Comment Public Notice, the Bureau proposed to
set the upfront payment at $500 for each applicant. The Bureau did not
receive any comments in response to the proposed upfront payments, or
on its proposal that the upfront payment amount would determine a
bidder's eligibility to participate in the auction. Therefore, the
Bureau adopts the upfront payment for each applicant in Auction 77 as
proposed and set forth in Attachment A of the Auction 77 Procedures
Public Notice.
43. Former defaulters must calculate their upfront payment by
multiplying the upfront payment amount by 1.5.
C. Auction Registration
44. Approximately ten days before the auction, the FCC will issue a
public notice announcing all qualified bidders for Auction 77.
Qualified bidders are those applicants whose FCC Form 175 applications
have been accepted for filing, are complete and have timely submitted
upfront payments sufficient to make them eligible to bid in Auction 77.
45. All qualified bidders are automatically registered for the
auction. Registration materials will be distributed prior to the
auction by overnight mail. The mailing will be sent only to the contact
person at the contact address listed in the FCC Form 175 and will
include the SecurID[supreg] tokens that will be required to place bids,
the Integrated Spectrum Auction System (ISAS) Bidder's Guide, and the
Auction Bidder Line phone number.
46. Qualified bidders that do not receive this registration mailing
will not be able to submit bids. Therefore, any qualified bidder that
has not received this mailing by noon on Thursday, June 12, 2008,
should call (717) 338-2868. Receipt of this registration mailing is
critical to participating in the auction, and each applicant is
responsible for ensuring it has received all of the registration
material.
IV. Auction 77
47. Auction 77 will be held on Tuesday, June 17, 2008. The start
and finish time of the bidding round will be announced in a public
notice listing the qualified bidders, which is to be released
approximately 10 days before the start of the auction.
A. Auction 77 Structure
i. Single-Round Sealed-Bid Auction
48. In the Auction 77 Comment Public Notice, the Bureau proposed to
award the licenses included in Auction 77 using a single-round sealed-
bid auction. A commenter supports the Bureau's proposal. The Bureau
concludes that it is operationally feasible and appropriate to auction
the cellular unserved service area licenses through a single-round
sealed-bid auction.
ii. Auction Delay, Suspension, or Cancellation
49. In the Auction 77 Comment Public Notice, the Bureau proposed
that, by public notice or by announcement during the auction, the
Bureau may delay, suspend, or cancel the auction in the event of
natural disaster, technical obstacle, administrative or weather
necessity, evidence of an auction security breach or unlawful bidding
activity, or for any other reason that affects the fair and efficient
conduct of competitive bidding. The Bureau received no comment on this
issue.
50. Because the Bureau's approach to notification of delay during
an auction has proven effective in resolving exigent circumstances in
previous auctions, the Bureau adopts its proposed rules regarding
auction delay, suspension, or cancellation.
B. Bidding Procedures
i. Round Structure
51. The Commission will conduct Auction 77 over the Internet, and
telephonic bidding will be available as well. The toll-free telephone
number for the Auction Bidder Line will be provided to qualified
bidders. The start and finish time of the bidding round will be
announced in the public notice listing qualified bidders, which is
released approximately 10 days before the start of the auction.
52. The single-round sealed-bid format will consist of one bidding
round followed by the release of auction results. In the event of tied
bids in an MX group, the Commission will post an announcement in the
FCC Auction System to announce an additional round of bidding for that
MX group. The commenter supports the proposal.
ii. Reserve Price or Minimum Bid
53. In the Auction 77 Comment Public Notice, the Bureau proposed to
set the minimum bid at $500 for each of the two cellular unserved areas
in Auction
[[Page 26117]]
77. The Bureau received no comments concerning this proposal.
Therefore, the minimum bid for each of the two cellular unserved areas
is set at $500 and is set forth in Attachment A of the Auction 77
Procedures Public Notice.
iii. Bid Amounts
54. Bidders will be able to place a bid in any whole dollar amount
equal to or greater than the minimum bid for the cellular unserved area
for which they applied.
55. Bidders are also cautioned that they should type their bid
amounts carefully because, even if mistakenly or erroneously made,
bidders still assume a binding obligation to pay their full bid amount.
iv. Bid Removal and Bid Withdrawal
56. Bid Removal. Before the close of a bidding round, a bidder has
the option of removing any bids placed in that round. Once a round
closes, a bidder may no longer remove a bid. By using the remove bids
function in the FCC Auction System, a bidder may effectively unsubmit
any bid placed within that round. This procedure will enhance bidder
flexibility during the auction, and therefore the Bureau adopts these
proposals for Auction 77.
57. Bid Withdrawal. With respect to bid withdrawals, we proposed
not to allow any bid withdrawals (withdrawal of provisionally winning
bids from previous rounds) in Auction 77. The Bureau received no
comments on this issue. Therefore, the Bureau adopts its proposal.
v. Auction Results
58. At the end of the bidding round, the winning bid for each
cellular unserved area will be determined based on the highest bid
amount received for the area. Bids placed during a round will be made
public at the conclusion of that round. Specifically, after a round
closes, the Bureau will compile reports of all bids placed and which
bidders made them, the random numbers assigned to each bid (for tie-
breaking purposes), new minimum acceptable bid amounts, and will post
the reports for public access.
59. In the event of identical high bid amounts being submitted in a
cellular unserved area (i.e., tied bids), the Bureau proposed to allow
an additional bidding round or rounds, if necessary, for bidders to
submit higher bids for the cellular unserved area with tied bids. The
minimum bid for the next round will be calculated by rounding the tied
bid amount up to the next $100. The license(s) will be awarded to the
bidder submitting the highest bid in the additional round. If no bids
are placed in the additional round, the license(s) will be awarded to
the bidder that placed the tied bid that was assigned the higher random
number (a random number having previously been assigned to each bid).
If there is a tie for the winning bid in the additional round, the FCC
may add another tie-breaking round or rounds, or stop the auction
without awarding the license(s).
60. The Commission will announce the schedule for a subsequent
round via an announcement in the FCC Auction System, concurrent with
the release of round results. A commenter stated that it had no
objection to the proposal to conduct an additional round in the event
of tied bids. The Bureau believes that this approach is efficient and
therefore adopts its proposal.
61. Consistent with past practice, the Bureau will announce the
winning bid shortly after the close of the auction, and the amounts of
all bids submitted during the auction will be made publicly available.
vi. Auction Announcements
62. The Commission will use auction announcements to announce items
such as the schedule for a subsequent round in the event of tied bids
on a license. All auction announcements will be available by clicking a
link in the FCC Auction System.
V. Post-Auction Procedures
A. Down Payments
63. After bidding has ended in Auction 77, the Commission will
issue a public notice declaring the auction closed and identifying
winning bidders, down payments and final payments due.
64. Within ten business days after release of the auction closing
notice, each winning bidder must submit sufficient funds (in addition
to its upfront payment) to bring its total amount of money on deposit
with the Commission for licenses offered in Auction 77 to 20 percent of
the net amount of its winning bids.
B. Final Payments
65. Each winning bidder will be required to submit the balance of
the net amount of its winning bids within 10 business days after the
applicable deadline for submitting down payments.
C. Long-Form Application (FCC Form 601)
66. Within an MX group, the previously filed long-form
application(s) (FCC Form 601) of the unsuccessful bidder will be
dismissed following the grant of the winning bidder's license(s).
D. Ownership Disclosure Information Report (FCC Form 602)
67. Winning bidders must ensure that ownership information reported
on FCC Form 602 is accurate and up to date. Further instructions will
be provided to winning bidders at the close of the auction.
E. Default and Disqualification
68. Any winning bidder that defaults or is disqualified after the
close of the auction (i.e., fails to remit the required down payment
within the prescribed period of time, fails to make full payment, or is
otherwise disqualified) will be subject to the payments described in 47
CFR 1.2104(g)(2). The payments include both a deficiency payment, equal
to the difference between the amount of the bidder's bid and the amount
of the winning bid the next time a license covering substantially the
same spectrum and geographic area is won in an auction, plus an
additional payment equal to a percentage of the defaulter's bid or of
the subsequent winning bid, whichever is less.
69. The percentage of the bid that a defaulting bidder must pay in
addition to the deficiency will depend in part on the auction format
ultimately chosen for a particular auction, if the license is
subsequently reauctioned. In package auctions without package bidding,
the amount can range from three percent up to a maximum of twenty
percent, established in advance of the auction and based on the nature
of the service and the inventory of the licenses being offered.
70. As previously noted by the Commission, defaults weaken the
integrity of the auction process and impede the deployment of service
to the public, and an additional default payment of more than three
percent will be more effective in deterring defaults. Accordingly, in
the Auction 77 Comment Public Notice, the Bureau proposed to set the
additional default payment for the auction of the two cellular unserved
areas licenses at twenty percent of the applicable bid. Since Auction
77 is being conducted strictly to resolve conflicts between entities in
two cellular unserved areas that were unable to resolve their mutually
exclusive applications, a default by the winning bidder would suggest
that the bidder has not made a good-faith effort to abide by FCC
license assignment procedures, thereby weakening the integrity of the
auction process. The Bureau proposed to impose the maximum payment
percentage to deter such behavior. The Bureau
[[Page 26118]]
received no comments on this proposal. Therefore, the Bureau adopts its
proposal.
71. Finally, the Bureau notes that in the event of a default, the
Commission may reauction the license or offer it to the next highest
bidder (in descending order) at its final bid amount. In addition, if a
default or disqualification involves gross misconduct,
misrepresentation, or bad faith by an applicant, the Commission may
declare the applicant and its principals ineligible to bid in future
auctions, and may take any other action that it deems necessary,
including institution of proceedings to revoke any existing licenses
held by the applicant.
F. Refund of Remaining Upfront Payment Balance
72. All upfront payments submitted by applicants in Auction 77 may
be available to be refunded after the conclusion of the auction;
subject to any required payments (i.e. winning bid, deficiency, and/or
default payments). All refunds will be returned to the payer of record,
as identified on the FCC Form 159, unless the payer submits written
authorization instructing otherwise.
Federal Communications Commission.
Gary D. Michaels,
Deputy Chief, Auctions Spectrum and Access Division, WTB.
[FR Doc. E8-10381 Filed 5-7-08; 8:45 am]
BILLING CODE 6712-01-P