§ 25.165 - Surety bonds.

§ 25.165 Surety bonds.

Cross Reference

Link to an amendment published at 86 FR 49489, Sept. 3, 2021.

(a) For all space station licenses issued after September 20, 2004, other than licenses for DBS space stations, SDARS space stations, space stations licensed in accordance with § 25.122 or § 25.123, and replacement space stations as defined in paragraph (e) of this section, the licensee must post a bond within 30 days of the grant of its license. Space station licensed in accordance with § 25.122 or § 25.123 must post a bond within one year plus 30 days of the grant of the license. Failure to post a bond will render the license null and void automatically.

(1) An NGSO licensee must have on file a surety bond requiring payment in the event of default as defined in paragraph (c) of this section, in an amount, at a minimum, determined according to the following formula, with the resulting dollar amount rounded to the nearest $10,000: A = $1,000,000 + $4,000,000 * D/2192, where A is the amount to be paid and D is the lesser of 2192 or the number of days that elapsed from the date of license grant until the date when the license was surrendered.

(2) A GSO licensee must have on file a surety bond requiring payment in the event of default as defined in paragraph (c) of this section, in an amount, at a minimum, determined according to the following formula, with the resulting dollar amount rounded to the nearest $10,000: A = $1,000,000 + $2,000,000 * D/1827, where A is the amount to be paid and D is the lesser of 1827 or the number of days that elapsed from the date of license grant until the date when the license was surrendered.

(3) Licensees of satellite systems including both NGSO space stations and GSO space stations that will operate in the same frequency bands must file a surety bond requiring payment in the event of default as defined in paragraph (c) of this section, in an amount, at a minimum, to be determined according to the formula in paragraph (a)(1) of this section.

(b) The licensee must use a surety company deemed acceptable within the meaning of 31 U.S.C. 9304 et seq. (See, e.g., Department of Treasury Fiscal Service, Companies Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and As Acceptable Reinsurance Companies, 57 FR 29356, July 1, 1992.) The bond must name the U.S. Treasury as beneficiary in the event of the licensee's default. The licensee must provide the Commission with a copy of the performance bond, including all details and conditions.

(c) A licensee will be considered to be in default with respect to a bond filed pursuant to paragraph (a) of this section if it surrenders the license before meeting an applicable milestone requirement in § 25.164(a) or (b)(1) or if it fails to satisfy any such milestone.

(d) A licensee will be relieved of its bond obligation under paragraph (a) of this section upon a Commission finding that the licensee has satisfied the applicable milestone requirement(s) in § 25.164(a) and (b)(1) for the authorization.

(e) A replacement space station is one that:

(1) Is authorized to operate at an orbital location within ±0.15° of the assigned location of a GSO space station to be replaced or is authorized for NGSO operation and will replace an existing NGSO space station in its authorized orbit, except for space stations authorized under § 25.122 or § 25.123;

(2) Is authorized to operate in the same frequency bands, and with the same coverage area as the space station to be replaced; and

(3) Is scheduled to be launched so that it will be brought into use at approximately the same time as, but no later than, the existing space station is retired.

(f) An applicant that has submitted a Coordination Request pursuant to § 25.110(b)(3)(i) or an Appendix 30B filing pursuant to § 25.110(b)(3)(ii) must obtain a surety bond in the amount of $500,000 in accordance with the requirements in paragraph (b) of this section for licensees. The application will be returned as defective pursuant to § 25.112 if a copy of the required bond is not filed with the Commission within 30 days after release of a public notice announcing that the Commission has submitted the Coordination Request or Appendix 30B filing to the ITU.

(g) An applicant will be considered to be in default with respect to a bond filed pursuant to paragraph (f) of this section if the applicant fails to submit a complete, acceptable license application pursuant to § 25.110(b)(3)(iii) for the operation proposed in the initial application materials filed pursuant to § 25.110(b)(3)(i) or (b)(3)(ii) within two years of the date of submission of the initial application materials.

[68 FR 51507, Aug. 27, 2003, as amended at 69 FR 51587, Aug. 20, 2004; 81 FR 55335, Aug. 18, 2016; 82 FR 59986, Dec. 18, 2017; 85 FR 43735, July 20, 2020; 86 FR 49489, Sept. 3, 2021]