99-3334. Auction of C, D, E, and F Block Broadband PCS Licenses Scheduled for March 23, 1999; Minimum Opening Bids and Other Procedural Issues

[Federal Register Volume 64, Number 28 (Thursday, February 11, 1999)]
[Notices]
[Pages 6892-6902]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-3334]


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FEDERAL COMMUNICATIONS COMMISSION

[DA 98-2604; Report No. AUC-98-22-C (Auction No. 22)]


Auction of C, D, E, and F Block Broadband PCS Licenses Scheduled 
for March 23, 1999; Minimum Opening Bids and Other Procedural Issues

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: This is a summary of a Public Notice (DA 98-2604) released on 
December 23, 1998, and corrected by a Public Notice released on January 
21, 1999, setting forth notice and filing requirements, minimum opening 
bids, and other procedural matters for the upcoming auction of C, D, E, 
and F block broadband Personal Communications Services (PCS) licenses 
(Auction No. 22), in accordance with the Balanced Budget Act of 1997.

DATES: Auction No. 22 is scheduled to begin on March 23, 1999.

ADDRESSES: See the text of the Public Notice and attachments for 
information regarding important addresses.

FOR FURTHER INFORMATION CONTACT:
    Media Contact: Meribeth McCarrick, [phone].
    Auctions Division: Jeff Garretson, Operations; Bob Reagle, Auctions 
Analysis; or Audrey Bashkin, Legal, [phone].
    Commercial Wireless Division: David Judelsohn, [phone].

SUPPLEMENTARY INFORMATION: The complete text of this Public Notice, 
including four attachments that do not appear in this summary, is 
available for inspection and copying Monday through Thursday from 9 
a.m. to 4 p.m., and Friday from 9 a.m. to 2 p.m., in the Wireless 
Telecommunications Bureau's Public Reference Room (Room 5608), 2025 M 
Street, NW, Washington, DC, 20554, or on the Commission's World Wide 
Web page, located at http://www.fcc.gov/wtb/auctions. Copies also may 
be purchased from the Commission's copy contractor, International 
Transcription Services, Inc. (ITS), 1231 20th Street, NW, Washington, 
DC 20036, [phone]. The four attachments that do not appear in 
this summary, but are available as described above, are: Attachment A 
(Summary of Licenses to be Auctioned, Upfront Payments, Minimum Opening 
Bids); Attachment B (Guidelines for Completing FCC Forms 175 and 159 
and Exhibits); Attachment C (Electronic Filing and Review of FCC Form 
175); and Attachment D (Summary Listing of Documents from the 
Commission and the Wireless Telecommunications Bureau Addressing 
Application of the Anti-Collusion Rules).

Synopsis

I. Introduction

    1. The Commission will hold an auction for 208 30 MHz and 134 15 
MHz C block licenses, as well as for three 10 MHz D block, six 10 MHz E 
block, and five 10 MHz F block licenses.
    2. Auction Date: The auction will commence on March 23, 1999. The 
initial schedule for bidding will be announced by public notice at 
least one week before the start of the auction. Unless otherwise 
announced, bidding will be conducted on each business day until bidding 
has stopped on all licenses.
    3. Bidding Methodology: Simultaneous multiple round bidding. 
Bidding will be permitted only from remote locations, either 
electronically (by computer) or telephonically.

Pre-Auction Deadlines:
     Auction Seminar--February 3, 1999
     Short Form Application (FCC Form 175)--February 12, 1999; 
5:30 p.m. ET
     Upfront Payments (via wire transfer)--March 1, 1999; 6:00 
p.m. ET
     Orders for Remote Bidding Software--March 9, 1999
     Mock Auction--March 18, 1999
Telephone Contacts:
     FCC National Call Center--(888) CALL-FCC ([phone]) 
or [phone] (direct dial). For Bidder Information Packages, 
General Auction Information, and Seminar Registration, press option #2 
at the prompt. Hours: 8 a.m.-5:30 p.m. ET, Monday through Friday.
     FCC Technical Support Hotline--[phone] (voice), 
[phone] (text telephone (TTY)). Hours of service:

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8 a.m.-6 p.m. ET, Monday through Friday.

A. Background

    4. Broadband PCS encompasses a variety of mobile and/or portable 
radio services, using such devices as small, lightweight, multifunction 
portable phones, portable fax machines, and advanced devices with two-
way data capabilities that are competing with existing cellular, 
paging, and other land mobile services. Auction No. 22 will be the 
third auction of C block spectrum and the second auction of D, E, and F 
block spectrum.
    5. Frequency blocks C and F have been designated by the Commission 
as ``entrepreneurs' blocks,'' meaning that participation in auctions of 
C and F block licenses is limited to entities qualifying as 
entrepreneurs under the Commission's rules. Eligibility requirements 
for participation in auctions of C or F block licenses are discussed in 
greater detail below in Part II of the Public Notice.
    6. Frequency block C encompasses 1895-1910 MHz paired with 1975-
1990 MHz. In the first C block auction (Auction No. 5), which began on 
December 18, 1995 and concluded on May 6, 1996, the Commission 
auctioned licenses authorizing service on 30 MHz of spectrum in each of 
the 493 basic trading areas (``BTAs'') in the United States and 
territories. In the second C block auction (Auction No. 10), the 
Commission made available 18 licenses of 30 MHz of spectrum each. 
Auction No. 10 ran from July 3, 1996 to July 16, 1996. In 1997, as one 
of several payment options, the Commission allowed C block licensees 
from Auctions 5 and 10 to disaggregate and return to the Commission 15 
MHz of spectrum from their licenses. As a result, certain C block 
licenses available in Auction No. 22 will encompass 15 MHz of spectrum, 
rather than 30 MHz. The size of each license to be auctioned is 
indicated in Attachment A of the full text of the Public Notice (see 
``Supplementary Information'' above).
    7. The D, E, and F block auction (Auction No. 11) began on August 
26, 1996 and concluded on January 14, 1997. The D and E blocks were 
open to all entities. As mentioned, the F block was restricted to 
entrepreneurs. In Auction No. 11, the Commission made available 1,479 
broadband PCS licenses (three in each of 493 BTAs in the United States 
and territories) of 10 MHz (5 MHz paired) each, encompassing the 
following frequencies:
D block: 1865-1870/1945-1950 MHz
E block: 1885-1890/1965-1970 MHz
F block: 1890-1895/1970/1975 MHz

B. Due Diligence

    8. Potential bidders are reminded that private and common carrier 
fixed microwave services (``FMS'') operating in the 1850-1990 MHz band 
(and other bands) are being relocated to available frequencies in 
higher bands or to other media. Bidders should become familiar with the 
status of FMS operation and relocation, and applicable Commission rules 
and orders, in order to make a reasoned, appropriate decision about 
their participation in Auction No. 22 and their bidding strategy.
    9. Potential bidders should be aware that certain applications 
(including those for modification), waiver requests, petitions for 
reconsideration and applications for review are pending before the 
Commission that relate to C, D, E, and F block licensees. We note that 
resolution of these matters could have an effect on the availability of 
spectrum. In addition, while the Commission will continue to act on 
pending applications, requests and petitions, some of these matters may 
not be resolved by the time of the auction.
    10. In notes to Attachment A of the full text of the Public Notice 
(see ``Supplementary Information'' above), as corrected by the Public 
Notice released January 21, 1999, the Commission identified certain 
licenses that will be included in Auction No. 22 as being the subject 
of pending judicial proceedings. The Commission emphasizes that the 
auction of spectrum associated with those licenses, including spectrum 
associated with defaulted licenses, will not be postponed until the 
resolution of pending judicial appeals. It is in the public interest to 
include those licenses in Auction No. 22, not only because to do so 
will likely speed ultimate service to the public, but also because a 
simultaneous auction of licenses for several markets will better 
reflect the value of the licenses.
    11. Moreover, licenses that are the subject of such proceedings 
will be granted at the close of the auction in order to serve the 
public interest in prompt implementation of PCS service, and the grant 
of such licenses will be conditioned on the outcome of pending 
proceedings. A license grant that is conditioned on the outcome of a 
pending proceeding may be undone if the basis for the grant is reversed 
as a result of the outcome of the proceeding. For this reason, 
applicants have a responsibility to familiarize themselves with all 
pending administrative or judicial proceedings that may affect the 
licenses on which applicants might wish to bid.
    12. Winning bidders of licenses subject to pending proceedings are 
required to meet the normal payment and construction schedules 
established by the Commission. The risk that a pending proceeding might 
ultimately displace a winning bidder must be taken into account by 
auction participants as they formulate and pursue their bidding 
strategies. The Commission has not addressed directly whether, if an 
applicant becomes ineligible to hold a license because the initiator of 
a pending proceeding is successful, the Commission will return the 
payments made for the license by the applicant. This issue will be 
addressed separately.
    13. Licensing information is contained in the Commission's 
licensing database, which is available for inspection in the Wireless 
Telecommunications Bureau's Public Reference Rooms, located at 2025 M 
Street, NW, Room 5608, Washington, DC 20554, and 1270 Fairfield Road, 
Gettysburg, PA 17325. In a future Public Notice, the Bureau will 
provide the new location of the Commission's licensing database in the 
Portals building.
    14. In addition, potential bidders may search for information 
regarding C, D, E, and F block licenses at the Universal Licensing 
System site on the FCC Network. Accessing this network involves using 
the FCC's Dial-Up Networking facility to dial [phone]. Once the 
connection is established, users point their Internet browser at http:/
/wtbwww05.fcc.gov/ and click the License Search button. On the License 
Search screen, choose Market-Based from the menu. On the License Search 
criteria screen, specify the desired Market, Channel Block, or other 
desired criteria, then click the Search button. Any telephone inquiries 
regarding accessing this data should be directed to the Technical 
Support Hotline at [phone] (voice) or [phone] (text 
telephone (TTY)).
    15. The Commission makes no representations or guarantees regarding 
the accuracy or completeness of information that has been provided by 
incumbent licensees and incorporated into the database. Potential 
bidders are strongly encouraged to physically inspect any sites located 
in or near the geographic area for which they plan to bid.

C. Participation

    16. Those wishing to participate in the auction must:
     Electronically submit a short form application (FCC Form 
175) by February 12, 1999.

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     Submit a sufficient upfront payment and an FCC Remittance 
Advice Form (FCC Form 159) by March 1, 1999.
     Comply with all provisions outlined in the Bidder 
Information Package.

D. Prohibition of Collusion

    17. To ensure the competitiveness and integrity of the auction 
process, the Commission's Rules prohibit applicants for the same 
geographic license area from communicating with each other during the 
auction about bids, bidding strategies, or settlements. This 
prohibition begins with the filing of short-form applications, and ends 
on the down payment due date. Bidders competing for the same license(s) 
are encouraged not to use the same individual as an authorized bidder. 
A violation of the anti-collusion rule 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 the bidders he/she is authorized to represent in the 
auction. Also, if the authorized bidders are different individuals 
employed by the same organization (e.g., law firm or consulting firm), 
a violation could similarly occur. At a minimum, in such a case, 
applicants should certify that precautionary steps have been taken to 
prevent communication between authorized bidders and that applicants 
and their bidding agents will comply with the anti-collusion rule. The 
Bureau, however, cautions that merely filing a certifying statement as 
part of an application will not outweigh specific evidence that 
collusive behavior has occurred nor will it preclude the initiation of 
an investigation when warranted. In Auction No. 22, for example, the 
rule would apply to any applicants bidding for the same BTA. Therefore, 
applicants that apply to bid for ``all markets'' would be precluded 
from communicating with all other applicants after filing the FCC Form 
175. However, applicants may enter into bidding agreements before 
filing their FCC Form 175 short-form applications, as long as they 
disclose the existence of the agreement(s) in their Form 175 short-form 
applications. By signing their FCC Form 175 short-form applications, 
applicants are certifying their compliance with Section 1.2105(c). 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 within 30 days of 
any substantial change that may be of decisional significance to that 
application. Thus, Section 1.65 requires an auction applicant to notify 
the Commission of any violation of the anti-collusion rules upon 
learning of such violation.

E. Bidder Information Package

    18. More complete details about this auction are contained in a 
Bidder Information Package. The Commission will provide one copy to 
each applicant free of charge. Additional copies may be ordered at a 
cost of $16.00 each, including postage, payable by Visa or Master Card, 
or by check payable to ``Federal Communications Commission'' or 
``FCC.'' To place an order, contact the FCC National Call Center at 
(888) CALL-FCC ([phone], press option #2 at the prompt). 
Prospective bidders that have already contacted the FCC at this number 
expressing an interest in this auction will receive a Bidder 
Information Package in approximately four weeks, and need not call 
again unless they wish to order additional copies.

F. Relevant Authority

    19. Prospective bidders must familiarize themselves thoroughly with 
the Commission's Rules relating to Broadband PCS contained in Title 47, 
Part 24, of the Code of Federal Regulations, and those relating to 
application and auction procedures, contained in Title 47, Part 1, of 
the Code of Federal Regulations. Prospective bidders must also be 
thoroughly familiar with the procedures, terms and conditions contained 
in the C Block Second Report and Order and Further Notice of Proposed 
Rule Making, 62 FR 55348, October 24, 1997; the C Block Reconsideration 
Order, 63 FR 17111, April 8, 1998; the C Block Fourth Report and Order, 
63 FR 50791, September 23, 1998; Part 24, Subparts A, B, C, E, H, and I 
of the Commission's Rules concerning broadband PCS; and Part 1, Subpart 
Q, of the Commission's Rules concerning competitive bidding 
proceedings.
    20. The terms contained in the Commission's Rules, relevant orders, 
public notices and bidder information package are not negotiable. The 
Commission may amend or supplement the information contained in its 
public notices or the bidder information package at any time, and will 
issue public notices to convey any new or supplemental information to 
bidders. It is the responsibility of all prospective bidders to remain 
current with all Commission Rules and with all public notices 
pertaining to this auction. Copies of most Commission documents, 
including public notices, can be retrieved from the FCC Internet node 
via anonymous ftp @ftp.fcc.gov or the FCC World Wide Web site at http:/
/www.fcc.gov/wtb/auctions. Additionally, documents may be obtained for 
a fee by calling the Commission's copy contractor, International 
Transcription Service, Inc. (ITS), at [phone].
    21. Bidder Alerts: 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 in this service, subject to certain conditions and 
regulations. An FCC auction does not constitute an endorsement by the 
FCC of any particular services, technologies or products, nor does an 
FCC license constitute a guarantee of business success. Applicants 
should perform their individual due diligence before proceeding, as 
they would with any new business venture.
    22. As is the case with many business investment opportunities, 
some unscrupulous entrepreneurs may attempt to use Auction No. 22 to 
deceive and defraud unsuspecting investors. Common warning signals of 
fraud include the following:
     The first contact is a ``cold call'' from a telemarketer, 
or is made in response to an inquiry prompted by a radio or television 
infomercial.
     The offering materials used to invest in the venture 
appear to be targeted at IRA funds, for example by including all 
documents and papers needed for the transfer of funds maintained in IRA 
accounts.
     The amount of the minimum investment is less than $25,000.
     The sales representative makes verbal representations 
that: (a) the Internal Revenue Service (``IRS''), Federal Trade 
Commission (``FTC''), Securities and Exchange Commission (``SEC''), 
FCC, or other government agency has approved the investment; (b) the 
investment is not subject to state or federal securities laws; or (c) 
the investment will yield unrealistically high short-term profits. In 
addition, the offering materials often include copies of actual FCC 
releases, or quotes from FCC personnel, giving the appearance of FCC 
knowledge or approval of the solicitation.
    23. Information about deceptive telemarketing investment schemes is 
available from the FTC at [phone] and from the SEC at (202) 942-
7040. Complaints about specific deceptive telemarketing investment 
schemes should be directed to the FTC,

[[Page 6895]]

the SEC, or the National Fraud Information Center at [phone]. 
Consumers who have concerns about specific proposals regarding Auction 
No. 22 may also call the FCC National Call Center at (888) CALL-FCC 
([phone]).

G. National Environmental Policy Act (NEPA) Requirements

    24. Licensees must comply with the Commission's rules regarding the 
National Environmental Policy Act (NEPA). The construction of a 
wireless antenna facility is a federal action and licensees must comply 
with the Commission's NEPA rules for each wireless facility. See 47 CFR 
1.1305-1.1319. These rules require that, among other things, licensees 
consult with expert agencies having NEPA responsibilities including the 
U.S. Fish and Wildlife Service, the State Historic Preservation Office, 
the Army Corps of Engineers, and the Federal Emergency Management 
Agency (through the local authority with jurisdiction over 
floodplains). Licensees must prepare environmental assessments for 
wireless facilities that may have a significant impact in or on 
wilderness areas, wildlife preserves, threatened or endangered species 
or designated critical habitats, historical or archaeologic sites, 
Indian religious sites, floodplains, and surface features. Licensees 
must also prepare environmental assessments for wireless facilities 
that include high intensity white lights in residential neighborhoods 
or excessive radiofrequency emission.

II. Eligibility

A. General Requirements

    25. All applicants must certify on their FCC Form 175 applications 
under penalty of perjury that they are legally, technically, 
financially, and otherwise qualified to hold a license and, as 
discussed below in Part II.D., that they are not in default on any 
payment for Commission licenses (including down payments) or delinquent 
on any non-tax debt owed to any Federal agency. Prospective bidders 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.

B. Eligibility To Participate as an Entrepreneur (C and F Blocks)

(1) General Rule
    26. Only entrepreneurs as defined in Section 24.709 of the 
Commission's Rules may be licensed in the C and F blocks.
(2) Limited Exception for C Block
    27. Applicants that participated in either of the prior C block 
auctions, Auction No. 5 and Auction No. 10, will not be required for 
Auction No. 22 to meet the revenue and asset requirements of Section 
24.709 of the Commission's Rules for C block licenses.

C. Attribution Rules

    28. The attribution rules set forth in Section 24.709 of the 
Commission's Rules will apply to Auction No. 22.

D. Special C Block Eligibility Provisions Regarding Defaulters

    29. The Commission decided in the C Block Fourth Report and Order 
to limit participation in future C block auctions to applicants that 
are not in default on any Commission licenses and are not delinquent on 
any non-tax debt owed to any Federal agency. Accordingly, to be able to 
bid on C block licenses, an applicant must certify on its FCC Form 175 
application that it is not in default on any Commission licenses and 
that it is not delinquent on any non-tax debt owed to any Federal 
agency. In addition, to be able to bid on C block licenses, an 
applicant must attach to its FCC Form 175 application a statement made 
under penalty of perjury indicating whether or not the applicant has 
ever been in default on any Commission licenses or has ever been 
delinquent on any non-tax debt owed to any federal agency. C block 
applicants must include this statement at Exhibit F of the FCC Form 
175.
    30. ``Former defaulters'' (i.e., applicants that have defaulted or 
been delinquent in the past, but that have since paid all of their 
outstanding non-tax debts and all associated charges or penalties) are 
eligible to bid on C block licenses, provided that they are otherwise 
qualified. However, as discussed below in Part III.C.(3), former 
defaulters will be required to pay upfront payments that are fifty 
percent more than the normal upfront payment amounts if they are 
bidding on any C block licenses.
    31. An applicant must state under penalty of perjury whether or not 
any entity whose gross revenues and total assets are required to be 
attributed to the applicant under Section 24.709 of the Commission's 
Rules has ever been in default on any Commission licenses or has ever 
been delinquent on any non-tax debt owed to any Federal agency. If any 
entity whose gross revenues and total assets are required to be 
attributed to the applicant under Section 24.709 of the Commission's 
Rules has ever been in default on any Commission licenses or has ever 
been delinquent on any non-tax debt owed to any Federal agency, the 
applicant will be considered a ``former defaulter'' for purposes of the 
upfront payment requirements for Auction No. 22.
    32. We note, moreover, that if any entity whose gross revenues and 
total assets are required to be attributed to the applicant under 
Section 24.709 of the Commission's Rules is in default on any 
Commission licenses or is delinquent on any non-tax debt owed to any 
Federal agency at the time the applicant files its FCC Form 175 
application, the applicant will not be able to make the certification 
required by Section 1.2105(a)(2)(x) of the Commission's Rules and will 
not be eligible to participate in Auction No. 22.
    33. We will not consider an applicant in default or delinquent on a 
Commission installment obligation for purposes of C block eligibility 
and upfront payment rules unless and until the obligated entity has 
allowed the Section 1.2110(f)(4)(ii) non-default period to pass without 
having made the requisite payment.

E. Special C Block Eligibility Restriction Regarding Surrendered C 
Block Licenses

    34. C block licensees that surrendered C block licenses pursuant to 
the disaggregation, prepayment, and/or amnesty/prepayment election 
options the Commission made available in the C Block Second Report and 
Order and Further Notice, as modified by the C Block Reconsideration 
Order, are ineligible to reacquire the spectrum represented by their 
surrendered licenses through participation in Auction No. 22, or by any 
other means, for a period of two years from the start date of Auction 
No. 22. This prohibition extends to qualifying members of the 
licensee's control group, and their affiliates. See 47 CFR 
24.709(b)(9)(ii). Licensees that surrendered licenses pursuant to the 
``pure amnesty'' election option remain eligible to reacquire the 
spectrum represented by those surrendered licenses in Auction No. 22 or 
through a secondary market transaction.

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F. General Eligibility Criteria Regarding Small and Very Small 
Businesses

    35. The Commission has adopted special small business provisions 
for the C and F blocks in order to promote and facilitate the 
participation of small businesses in auctions of C and F block licenses 
and in the provision of broadband PCS.
(1) Determination of Revenues
    36. To determine which entities qualify as very small businesses or 
small businesses, the Commission will consider the gross revenues of 
the applicant, its affiliates, persons or entities holding interests in 
the applicant and their affiliates on a cumulative basis and aggregated 
subject to the exceptions set forth in Section 24.709(b) of the 
Commission's Rules. Therefore, the gross revenues of all of the above 
entities must be disclosed separately and in the aggregate as Exhibit C 
to an applicant's FCC Form 175.
(2) Very Small or Small Business Consortia
    37. A consortium of small businesses or very small businesses is a 
conglomerate organization formed as a joint venture between or among 
mutually independent business firms, each of which individually 
satisfies the definition of very small or small business in Section 
24.720(b)(1) or (2). Thus, each consortium member must disclose its 
gross revenues along with those of its affiliates and persons or 
entities holding interests in the consortium member and their 
affiliates. The Commission notes that although the gross revenues of 
the consortium members will not be aggregated for purposes of 
determining eligibility for very small or small business credits, this 
information must be provided to ensure that each individual consortium 
member qualifies for any bidding credit awarded to the consortium.
(3) Application Showing
    38. Applicants should note that they will be required to file 
supporting documentation as Exhibit C to their FCC Form 175 short form 
applications to establish that they meet the gross revenue and total 
asset limitations of Section 24.709 of the Commission's Rules, and that 
they satisfy the eligibility requirements to qualify as very small 
businesses or small businesses (or consortia of very small or small 
businesses) for this auction. See 47 CFR 24.709 and 1.2105. 
Specifically, for Auction No. 22, applicants applying to bid for C and/
or F block licenses as very small or small businesses (or consortia of 
very small or small businesses) will be required to file as Exhibit C 
to their FCC Form 175 short form applications, all information required 
under Sections 1.2105(a), 1.2112(b), and 24.709. In addition, these 
applicants must disclose, separately and in the aggregate, the gross 
revenues for the preceding three years of each of the following: (1) 
the applicant; (2) the applicant's affiliates; (3) the applicant's 
attributable interests; and (4) the affiliates of the applicant's 
attributable interests. Certification that the average gross revenues 
for the preceding three years do not exceed the applicable limit is not 
sufficient. A statement of the total gross revenues for the preceding 
three years is also insufficient. The applicant must provide a schedule 
of gross revenues for each of the preceding three years, as well as a 
statement of total average gross revenues for the three-year period. If 
the applicant is applying as a consortium of very small or small 
businesses, this information must be provided for each consortium 
member.

G. Bidding Credits

    39. Qualifying applicants in Auction No. 22 are eligible for a 
bidding credit on C and F block licenses that represents the amount by 
which a bidder's winning bids are discounted. The size of the bidding 
credit depends on the average gross revenues for the preceding three 
years of the bidder, its affiliates, and persons or entities that hold 
interests in the bidder and their affiliates:
     A bidder with average gross revenues not to exceed $40 
million for the preceding three years receives a 15 percent discount on 
its winning bids for C and F block licenses; and,
     A bidder with average gross revenues not to exceed $15 
million for the preceding three years receives a 25 percent discount on 
its winning bids for C and F block licenses.
    40. Bidding credits are not cumulative: qualifying applicants 
receive either the 15 percent or the 25 percent bidding credit, but not 
both. The definitions of very small business and small business (or a 
consortium of very small or small businesses) (including calculation of 
average gross revenues) are set forth in 47 CFR 24.720(b).
    41. Bidders for C or F block licenses should note that transfer and 
assignment restrictions and unjust enrichment provisions apply to 
winning bidders that use bidding credits and subsequently assign or 
transfer control of their licenses to an entity not qualifying for the 
same levels of bidding credits. See 47 CFR 1.2111 and 24.714(a)(3). 
There are no installment payment plans in Auction No. 22.

III. Pre-auction Procedures

A. Short-Form Application (FCC Form 175)--Due February 12, 1999

(1) Electronic Filing
    42. In order to be eligible to bid in this auction, applicants must 
first electronically submit an FCC Form 175 application. There is no 
application fee required when filing an FCC Form 175; however, to be 
eligible to bid, an applicant must submit an upfront payment. 
Applications may be filed at any time from January 25, 1999 until 5:30 
p.m. ET on February 12, 1999. Late applications will not be accepted. 
Applicants are strongly encouraged to file early, and applicants are 
responsible for allowing adequate time for filing their applications. 
Applicants may update or amend their electronic applications multiple 
times until the filing deadline of February 12, 1999. Applicants must 
press the ``Submit Form 175'' button on the ``Submit'' page of the 
electronic form to successfully submit their FCC Form 175s. Information 
about installing and running the FCC Form 175 application software is 
included in Attachment C of the full text of the Public Notice (see 
SUPPLEMENTARY INFORMATION above). Technical support is available at 
[phone] (voice) or [phone] (text telephone (TTY)); the 
hours of service are 8 a.m.-6 p.m. ET, Monday through Friday.
(2) Completion of the FCC Form 175
    43. Applicants should carefully review 47 CFR 1.2105, and must 
complete all items on the FCC Form 175. Instructions for completing the 
FCC Form 175 are in Attachment B of the full text of the Public Notice 
(see Supplementary Information above).
(3) Electronic Review of FCC Form 175
    44. The FCC Form 175 review software may be used to review and 
print applicants' FCC Form 175 applications. Applicants may also view 
other applicants' completed FCC Form 175s after the filing deadline has 
passed and the FCC has issued a public notice explaining the status of 
the applications. For this reason, it is important that applicants do 
not include their Taxpayer Identification Numbers (TINs) on any 
Exhibits to their FCC Form 175 applications. There is a fee of $2.30 
per minute for accessing this system. For details, see Attachment C of 
the full text of the Public Notice (see SUPPLEMENTARY INFORMATION 
above).

[[Page 6897]]

B. Application Processing and Minor Corrections

    45. After the FCC Form 175 filing deadline has passed, the FCC will 
process all timely submitted applications to determine which are 
acceptable for filing, and subsequently will issue a public notice 
identifying: (1) those applications accepted for filing (including FCC 
account numbers and the licenses for which they applied); (2) those 
applications rejected; and (3) those incomplete applications which have 
minor defects that may be corrected, and the deadline for filing such 
corrected applications. After the FCC Form 175 filing deadline has 
passed, applicants cannot make major modifications to their 
applications (e.g., change their license selections, change the 
certifying official, or change control of the applicant). See 47 CFR 
1.2105.

C. Upfront Payments--Due March 1, 1999

(1) FCC Form 159
    46. To be eligible to bid in the auction, applicants must submit an 
upfront payment accompanied by an FCC Remittance Advice Form (FCC Form 
159). Manual filers of FCC Form 159 must use the July 1997 version of 
FCC Form 159. Filers of the FCC Form 175 will have access to an 
electronic version of FCC Form 159 after completing the FCC Form 175. 
Earlier versions of this form will not be accepted. Proper completion 
of FCC Form 159 is critical to ensuring correct credit of upfront 
payments. Detailed instructions for completion of FCC Form 159 are 
included in Attachment B of the full text of the Public Notice (see 
SUPPLEMENTARY INFORMATION above), and will also be included in the 
Bidder Information Package.
(2) Making Auction Payments by Wire Transfer
    47. All upfront payments must be received at Mellon Bank in 
Pittsburgh, PA, by 6:00 p.m. ET on March 1, 1999. Please note that:
     All payments must be made in U.S. dollars.
     All payments must be made by wire transfer.
     Upfront payments for Auction No. 22 go to a lockbox number 
different from the ones used in previous FCC auctions, and different 
from the lockbox number to be used for post-auction payments.
     Failure to deliver the upfront payment by the March 1, 
1999 deadline will result in dismissal of the application and 
disqualification from participation in the auction.
To avoid untimely payments, applicants should discuss arrangements 
(including bank closing schedules) with their banker several days 
before they plan to make the wire transfer, and allow sufficient time 
for the transfer to be initiated and completed before the deadline. 
Applicants will need the following information:

ABA Routing Number: 043000261
Receiving Bank: Mellon Pittsburgh
BNF: FCC/AC 910-0198
OBI Field: (Skip one space between each information item)
``AUCTIONPAY''
TAXPAYER IDENTIFICATION NO. (same as FCC Form 159, block 26)
PAYMENT TYPE CODE (enter ``APCU'')
FCC CODE 1 (same as FCC Form 159, block 23A: ``22'')
PAYER NAME (same as FCC Form 159, block 2)
LOCKBOX NO. #358410

    Note: The BNF and Lockbox numbers are specific to the upfront 
payments for this auction; BNF or Lockbox numbers from previous 
auctions should not be used. Applicants must fax a completed FCC 
Form 159 to Mellon Bank at [phone] at least one hour before 
placing the order for the wire transfer (but on the same business 
day). On the cover sheet of the fax, write ``Wire Transfer--Auction 
Payment for Auction Event No. 22.'' Bidders may confirm receipt of 
their upfront payment by contacting their sending financial 
institution.
(3) Amount of Upfront Payment
    48. The upfront payment amount for each C, D, E, and F block 
license to be auctioned in Auction No. 22 will be calculated as 
$0.06*MHz*BTA Population (``Pops''). The upfront payment amount for 
each license has been calculated and is listed in Attachment A of the 
full text of the Public Notice (see Supplementary Information above).
    49. In accordance with the C Block Fourth Report and Order, and as 
proposed in Procedural Public Notice I and II, the upfront payment 
amount for ``former defaulters'' applying to bid on any C block 
licenses will be fifty percent more than the normal amount required to 
be paid. (In other words, ``former defaulters'' must pay an extra fifty 
percent in upfront payment to receive the same number of bidding units 
that ``non-former defaulters'' receive for the basic upfront payment. 
See Attachment A of the full text of the Public Notice (see 
SUPPLEMENTARY INFORMATION above). Any former defaulter that applies to 
bid on ``all markets,'' or designates D, E, or F block licenses in 
addition to at least one C block license will be subject to the higher 
upfront payment requirement. Former defaulters that apply to bid only 
on D, E, or F block licenses will not be subject to the higher upfront 
payment requirement.
    50. In Auction No. 22, the amount of the upfront payment submitted 
by a bidder will determine the initial maximum eligibility (as measured 
in bidding units) for each bidder. Please note that upfront payments 
are not attributed to specific licenses. For Auction No. 22, the amount 
of the upfront payment will be translated into bidding units on a one-
to-one basis, e.g., a $25,000 upfront payment provides the bidder with 
25,000 bidding units, unless the bidder is a ``former defaulter.'' A 
``former defaulter'' will be required to pay $37,500 (or 1.5 times the 
basic upfront payment) for 25,000 bidding units. The total upfront 
payment defines the maximum amount of bidding units on which the 
applicant will be permitted to bid (including standing high bids) in 
any single round of bidding. Thus, an applicant does not have to make 
an upfront payment to cover all licenses that the applicant has 
selected on FCC Form 175, but rather to cover the maximum number of 
bidding units that are associated with licenses the bidder wishes to 
place bids on and hold high bids on at any given time.
    51. To place a bid on a license, in addition to having specified 
that license on the FCC Form 175, a bidder must have an eligibility 
level that meets or exceeds the number of bidding units assigned to 
that license. At a minimum, an applicant's total upfront payment must 
be enough to establish eligibility to bid on at least one of the 
licenses applied for on the FCC Form 175, or else the applicant will 
not be eligible to participate in the auction.
    52. In calculating the upfront payment amount, an applicant should 
determine the maximum number of bidding units it may wish to bid on in 
any single round, and submit an upfront payment covering that number of 
bidding units. Bidders should check their calculations carefully as 
there is no provision for increasing a bidder's maximum eligibility 
after the upfront payment deadline.
    53. Former defaulters that apply to bid on any C block licenses 
should calculate their upfront payment for all licenses by multiplying 
the number of bidding units they wish to purchase by 1.5. The 50 
percent increase calculation has been included on the spreadsheet in 
Attachment A of the full text of the Public Notice. To calculate the 
number of bidding units to assign to former defaulters applying to bid 
on any C block licenses, the Commission will divide the upfront payment 
received by

[[Page 6898]]

1.5 and round the result up to the nearest bidding unit.

    Note: An applicant may, on its FCC Form 175, apply for every 
license being offered, but its actual bidding in any round will be 
limited by the bidding units reflected in its upfront payment.
(4) Applicant's Wire Transfer Information for Purposes of Refunds
    54. The Commission will use wire transfers for all Auction No. 22 
refunds. To avoid delays in processing refunds, applicants should 
include wire transfer instructions with any refund request they file; 
they may also provide this information in advance by faxing it to the 
FCC Billings and Collections Branch to the attention of Linwood Jenkins 
or Geoffrey Idika, at [phone]. Please include the following 
information: (1) Name of Bank; (2) ABA Number; (3) Account Number to 
Credit; (4) Correspondent Bank (if applicable); (5) ABA Number; (6) 
Account Number; and (7) Contact and Phone Number. (Applicants should 
also note that implementation of the Debt Collection Improvement Act of 
1996 requires the FCC to obtain a Taxpayer Identification Number (TIN) 
before it can disburse refunds.) Eligibility for refunds is discussed 
below in Part V.D.

D. Auction Registration

    55. Approximately ten days before the auction, the FCC will issue a 
public notice announcing all qualified bidders for the auction. 
Qualified bidders are those applicants whose FCC Form 175 applications 
have been accepted for filing and that have timely submitted upfront 
payments sufficient to make them eligible to bid on at least one of the 
licenses for which they applied.
    56. All qualified bidders are automatically registered for the 
auction. Registration materials will be distributed prior to the 
auction by two separate overnight mailings, each containing part of the 
confidential identification codes required to place bids. These 
mailings will be sent only to the contact person at the applicant 
address listed in the FCC Form 175.
    57. Applicants that do not receive both registration mailings will 
not be able to submit bids. Therefore, any qualified applicant that has 
not received both mailings by noon on Wednesday, March 17, 1999 should 
contact the FCC National Call Center at (888) CALL-FCC ([phone], 
press option #2 at the prompt). Receipt of both registration mailings 
is critical to participating in the auction, and each applicant is 
responsible for ensuring that it has received all of the registration 
material. Qualified bidders should note that lost login codes, 
passwords or bidder identification numbers can be replaced only by 
appearing in person at the FCC Auction Headquarters, located at 2 
Massachusetts Avenue, NE, Washington, DC 20002. Only an authorized 
representative or certifying official, as designated on an applicant's 
FCC Form 175, may appear in person with two forms of identification 
(one of which must be a photo identification) in order to receive 
replacement codes.

E. Remote Electronic Bidding Software

    58. Qualified bidders must purchase remote electronic bidding 
software for $175.00 by March 9, 1999. (Auction software is tailored to 
a specific auction, so software from prior auctions will not work for 
Auction No. 22.) A software order form is included in the upcoming 
Bidder Information Package.

F. Auction Seminar

    59. On February 3, 1999, the FCC will sponsor a seminar for Auction 
No. 22 at the Park Hyatt Washington, 1201 24th Street, NW, Washington, 
DC 20037, [phone]. The seminar will provide attendees with 
information about pre-auction procedures, conduct of the auction, FCC 
remote bidding software, and the C, D, E, and F broadband PCS blocks 
and auction rules. To register, complete the registration form to be 
included in the Bidder Information Package. The registration form will 
include details about the time and location of the seminar. 
Registrations are accepted on a first-come, first-served basis.

G. Mock Auction

    60. All applicants whose FCC Form 175 has been accepted for filing 
will be eligible to participate in a mock auction beginning March 18, 
1999. The mock auction will enable applicants to become familiar with 
the electronic software prior to the auction. Free demonstration 
software will be available for use in the mock auction. Participation 
by all bidders is strongly recommended. Details will be announced by 
public notice.

IV. Auction Event

    61. The first round of the auction will begin on March 23, 1999. 
The initial round schedule will be announced in a Public Notice listing 
the qualified bidders, to be released approximately ten days before the 
start of the auction.

A. Auction Structure

(1) Simultaneous Multiple Round Auction
    62. As proposed in Procedural Public Notices I and II, the 
Commission will use a simultaneous multiple-round design for Auction 
No. 22.
(2) Maximum Eligibility and Activity Rules
    63. For Auction No. 22, the amount of the upfront payment submitted 
by a bidder will determine the initial maximum eligibility (as measured 
in bidding units) for each bidder. As stated above in Part III.C.(3), 
``former defaulters'' must pay a fifty percent higher upfront payment 
amount. There is no provision for increasing a bidder's maximum 
eligibility during the course of an auction, as described below in Part 
IV.A.(4).
    64. To ensure that the auction closes within a reasonable period of 
time, an activity rule requires bidders to bid actively throughout the 
auction, rather than wait until the end before participating. Bidders 
are required to be active on a specific percentage of their maximum 
eligibility during each round of the auction.
    65. A bidder is considered active on a license in the current round 
if it is either the high bidder at the end of the previous bidding 
round and does not withdraw the high bid in the current round, or if it 
submits an acceptable bid in the current round (see Part IV.B.(3), 
below). A bidder's activity level in a round is the sum of the bidding 
units associated with licenses on which the bidder is active. The 
minimum required activity level is expressed as a percentage of the 
bidder's maximum bidding eligibility, and increases as the auction 
progresses. These procedures have proven successful in maintaining the 
pace of previous auctions, as discussed below in Parts IV.A.(4) and 
(5).
(3) Activity Rule Waivers and Reducing Eligibility
    66. Each bidder will be provided five activity rule waivers that 
may be used in any round during the course of the auction. Use of an 
activity rule waiver preserves the bidder's current bidding eligibility 
despite the bidder's activity in the current round being below the 
required minimum level. An activity rule waiver applies to an entire 
round of bidding and not to a particular license.
    67. The FCC auction system assumes that bidders with insufficient 
activity would prefer to use an activity rule waiver (if available) 
rather than lose bidding eligibility. Therefore, the system will 
automatically apply a waiver (known as an ``automatic waiver'') at the 
end of any round where a bidder's activity level is below the minimum 
required unless: (1) there are

[[Page 6899]]

no activity rule waivers available; or (2) the bidder overrides the 
automatic application of a waiver by reducing eligibility, thereby 
meeting the minimum requirements.
    68. A bidder with insufficient activity that wants to reduce its 
bidding eligibility rather than use an activity rule waiver must 
affirmatively override the automatic waiver mechanism during the round 
by using the reduce eligibility function in the software. In this case, 
the bidder's eligibility is permanently reduced to bring the bidder 
into compliance with the activity rules as described below in Part 
IV.A.(4). Once eligibility has been reduced, a bidder will not be 
permitted to regain its lost bidding eligibility.
    69. Finally, a bidder may proactively use an activity rule waiver 
as a means to keep the auction open without placing a bid. If a bidder 
submits a proactive waiver (using the proactive waiver function in the 
bidding software) during a round in which no bids are submitted, the 
auction will remain open and the bidder's eligibility will be 
preserved. An automatic waiver invoked in a round in which there are no 
new valid bids or withdrawals will not keep the auction open.
(4) Auction Stages
    70. Auction No. 22 will be composed of three stages, which are each 
defined by an increasing activity rule. The FCC reserves the discretion 
to further alter the activity percentages before and/or during the 
auction. These procedures have proven successful in maintaining the 
proper pace in previous auctions.
    71. Stage One: In each round of the first stage of the auction, a 
bidder desiring to maintain its current eligibility is required to be 
active on licenses encompassing at least 80 percent of its current 
bidding eligibility. Failure to maintain the requisite activity level 
will result in a reduction in the bidder's bidding eligibility in the 
next round of bidding (unless an activity rule waiver is used). During 
Stage One, reduced eligibility for the next round will be calculated by 
multiplying the current round activity by five-fourths (5/4).
    72. Stage Two: In each round of the second stage, a bidder desiring 
to maintain its current eligibility is required to be active on 90 
percent of its current bidding eligibility. During Stage Two, reduced 
eligibility for the next round will be calculated by multiplying the 
current round activity by ten-ninths (10/9).
    73. Stage Three: In each round of the third stage, a bidder 
desiring to maintain its current eligibility is required to be active 
on 98 percent of its current bidding eligibility. In this final stage, 
reduced eligibility for the next round will be calculated by 
multiplying the current round activity by fifty-forty-ninths (50/49).

    Caution: Since activity requirements increase in each auction 
stage, bidders must carefully check their current activity during 
the bidding period of the first round following a stage transition. 
This is especially critical for bidders that have standing high bids 
and do not plan to submit new bids. In past auctions, some bidders 
have inadvertently lost bidding eligibility or used an activity rule 
waiver because they did not re-verify their activity status at stage 
transitions. Bidders may check their activity against the required 
minimum activity level by using the bidding software's bidding 
module.
(5) Stage Transitions
    74. Auction No. 22 will start in Stage One. Under the FCC's general 
guidelines it will advance to the next stage (i.e., from Stage One to 
Stage Two, and from Stage Two to Stage Three) when, in each of three 
consecutive rounds of bidding, the high bid has increased on less than 
ten percent of the licenses being auctioned (as measured in bidding 
units). However, the Commission will retain the discretion to regulate 
the pace of the auction by announcement. This determination will be 
based on a variety of measures of bidder activity, including, but not 
limited to, the auction activity level, the percentages of licenses (as 
measured in bidding units) on which there are new bids, the number of 
new bids, and the percentage increase in revenue.
(6) Auction Stopping Rules
    75. Barring extraordinary circumstances, bidding will remain open 
on all licenses until bidding stops on every license. Thus, the auction 
will close for all licenses when one round passes during which no 
bidder submits a new acceptable bid on any license, applies a proactive 
waiver, or withdraws a previous high bid. The Commission retains the 
discretion to close the auction for all licenses after the first round 
in which no bidder submits a proactive waiver, a withdrawal, or a new 
bid on any license on which it is not the standing high bidder. Thus, 
absent any other bidding activity, a bidder placing a new bid on a 
license for which it is the standing high bidder would not keep the 
auction open under this stopping rule procedure. We will notify bidders 
in advance of implementing any change to our simultaneous stopping 
rule.
    76. The Commission retains the discretion, however, to keep an 
auction open even if no new acceptable bids or proactive waivers are 
submitted, and no previous high bids are withdrawn. In this event, the 
effect will be the same as if a bidder had submitted a proactive 
waiver. Thus, the activity rule will apply as usual, and a bidder with 
insufficient activity will either lose bidding eligibility or use an 
activity rule waiver (if it has any left).
    77. Further, in its discretion, the Commission reserves the right 
to declare that the auction will end after a specified number of 
additional rounds (``special stopping rule''). If the FCC invokes this 
special stopping rule, it will accept bids in the final round(s) only 
for licenses on which the high bid increased in at least one of the 
preceding specified number of rounds. The FCC intends to exercise this 
option only in extreme circumstances, such as where the auction is 
proceeding very slowly, where there is minimal overall bidding 
activity, or where it appears likely that the auction will not close 
within a reasonable period of time. Before exercising this option, the 
FCC is likely to attempt to increase the pace of the auction by, for 
example, moving the auction into the next stage (where bidders would be 
required to maintain a higher level of bidding activity), increasing 
the number of bidding rounds per day, and/or increasing the amount of 
the minimum bid increments for the limited number of licenses where 
there is still a high level of bidding activity. As the Commission 
plans to invoke this option only in extreme circumstances, we will not 
routinely request bidder input prior to doing so; however, we remind 
bidders that they are free to make their views known to the Commission 
throughout the auction, and that the Suggestion Box in the Automated 
Auction System affords them one possible avenue of communication.
(7) Auction Delay, Suspension, or Cancellation
    78. By public notice or by announcement during the auction, the 
Commission may delay, suspend, or cancel the auction in the event of 
natural disaster, technical obstacle, evidence of an auction security 
breach, unlawful bidding activity, administrative or weather necessity, 
or for any other reason that affects the fair and competitive conduct 
of competitive bidding. In such cases, the Commission, in its sole 
discretion, may elect to: resume the auction starting from the 
beginning of the current round; resume the auction starting from some 
previous round; or cancel the auction in its entirety. Network 
interruption may

[[Page 6900]]

cause the Commission to delay or suspend the auction. We emphasize that 
exercise of this authority is solely within the discretion of the 
Commission, and its use is not intended to be a substitute for 
situations in which bidders may wish to apply their activity rule 
waivers.
    79. We will provide bidders with reasonable notice either by Public 
Notice or by announcement over the Automated Auction System prior to 
recommencing the auction. Although we will not seek comment prior to 
recommencing the auction, we reiterate that bidders may make their 
views known to the Commission throughout the auction and, if they 
choose, may use the Suggestion Box in the Automated Auction System for 
such communication.

B. Bidding Procedures

(1) Round Structure
    80. The initial bidding schedule will be announced by public notice 
at least one week before the start of the auction, and will be included 
in the registration mailings. The round structure for each bidding 
round contains a single bidding round followed by the release of the 
round results.
    81. The FCC has discretion to change the bidding schedule in order 
to foster an auction pace that reasonably balances speed with the 
bidders' need to study round results and adjust their bidding 
strategies. The FCC may increase or decrease the amount of time for the 
bidding rounds and review periods, or the number of rounds per day, 
depending upon the bidding activity level and other factors.
(2) Reserve Price or Minimum Opening Bid
    82. We adopt minimum opening bids for each of the licenses in 
Auction No. 22 that are reducible at the discretion of the Commission. 
This discretion will allow the Commission flexibility to adjust the 
minimum opening bids if circumstances warrant. We emphasize, however, 
that such discretion will be exercised, if at all, sparingly and early 
in the auction, i.e., before bidders lose all waivers and begin to lose 
substantial eligibility. During the course of the auction, the 
Commission will not entertain any bidder requests to reduce the minimum 
opening bid on specific licenses.
    83. Because all four spectrum blocks are being auctioned at the 
same time, under the same general conditions, we believe that it is 
appropriate to use a common baseline to establish the minimum opening 
bid formulae for all of the licenses in the auction. The net high bids 
from prior C block auctions provide the most comprehensive broadband 
PCS baseline. We, therefore, have decided to base the minimum opening 
bids for each license available in Auction No. 22, including D, E, and 
F block licenses, on the most recent net high bid for the C block 
license in the same BTA.
    84. We adopt the following formulae for calculating minimum opening 
bids:
1. 30 MHz licenses--5 percent of most recent net high bid for C block 
licenses in same BTA
2. 15 MHz licenses--2.5 percent of most recent net high bid for C block 
licenses in same BTA
3. 10 MHz licenses--1.6 percent of most recent net high bid for C block 
licenses in same BTA
    These formulae will apply without regard to the upfront payment 
amount required for the same license in Auction No. 22. The specific 
minimum opening bid for each license available in Auction No. 22 is set 
forth in Attachment A of the full text of the Public Notice (see 
Supplementary Information above).
(3) Minimum Accepted Bids
    85. Once there is a standing high bid on a license, a bid increment 
will be applied to that license to establish a minimum acceptable bid 
for the following round. For Auction No. 22, we will utilize an 
exponential smoothing methodology (further explained in the Bidder 
Information Package) to calculate minimum bid increments. We retain the 
discretion to change the minimum bid increment if we determine that 
circumstances so dictate.
(4) High Bids
    86. Each bid will be date-and time-stamped when it is entered into 
the FCC computer system. In the event of tie bids, the Commission will 
identify the high bidder on the basis of the order in which bids are 
received by the Commission, starting with the earliest bid. The bidding 
software allows bidders to make multiple submissions in a round. As 
each bid is individually date and time-stamped according to when it was 
submitted, bids submitted by a bidder earlier in a round will have an 
earlier date-and time-stamp than bids submitted later in a round.
(5) Bidding
    87. During a bidding round, a bidder may submit bids for as many 
licenses for which it is eligible, as well as withdraw high bids from 
previous bidding rounds, remove bids placed in the same bidding round, 
or permanently reduce eligibility. Bidders also have the option of 
making multiple submissions and withdrawals in each bidding round. If a 
bidder submits multiple bids for a single license in the same round, 
the system takes the last bid entered as that bidder's bid for the 
round, and the date-and time-stamp of that bid reflect the latest time 
the bid was submitted.
    88. All bidding will take place either through the automated 
bidding software or by telephonic bidding. (Telephonic bid assistants 
are required to use a script when handling bids placed by telephone. 
Telephonic bidders are therefore reminded to allow sufficient time to 
bid, by placing their calls well in advance of the close of a round, 
because four to five minutes are necessary to complete a bid 
submission.) There will be no on-site bidding during Auction No. 22.
    89. A bidder's ability to bid on specific licenses in the first 
round of the auction is determined by two factors: (1) the licenses 
applied for on FCC Form 175; and (2) the upfront payment amount 
deposited. The bid submission screens will be tailored for each bidder 
to include only those licenses for which the bidder applied on its FCC 
Form 175. A bidder also has the option to further tailor its bid 
submission screens to call up specified groups of licenses.
    90. The bidding software requires bidders to login to the FCC 
auction system during the bidding round using the FCC account number, 
bidder identification number, and the confidential security codes 
provided in their registration materials. Bidders are strongly 
encouraged to download and print bid confirmations after they submit 
their bids.
    91. The bid entry screen of the Automated Auction System software 
for Auction No. 22 allows bidders to place multiple increment bids to 
increase their high bids from one to nine bid increments. A single bid 
increment is defined as the difference between the standing high bid 
and the minimum acceptable bid for a license.
    92. To place a bid on a license, the bidder must enter a whole 
number between 1 and 9 in the bid increment multiplier (Bid Mult) 
field. This value will determine the amount of the bid (Amount Bid) by 
multiplying the bid increment multiplier by the bid increment and 
adding the result to the high bid amount per the following formula: 
Amount Bid = High Bid + (Bid Mult * Bid Increment) Thus, bidders may 
place a bid that exceeds the standing high bid by between one and nine 
times the bid increment. For example, to bid the minimum acceptable 
bid, which is equal to one

[[Page 6901]]

bid increment, a bidder will enter ``1'' in the bid increment 
multiplier column and press submit.
    93. For any license on which the FCC is designated as the high 
bidder (i.e., a license that has not yet received a bid in the auction, 
or a license on which the high bid was withdrawn and a new bid has not 
yet been placed), bidders will be limited to bidding only the minimum 
acceptable bid. In both of these cases, no increment exists for the 
licenses, and bidders should enter ``1'' in the Bid Mult field. Note 
that any whole number between 1 and 9 entered in the multiplier column 
will result in a bid value at the minimum acceptable bid amount.
(6) Bid Removal and Bid Withdrawal
a. Procedures
    94. Before the close of a bidding round, a bidder has the option of 
removing any bids placed in that round. By using the ``remove bid'' 
function in the software, a bidder may effectively ``unsubmit'' any bid 
placed within that round. A bidder removing a bid placed in the same 
round is not subject to withdrawal payments. Removing a bid will affect 
a bidder's activity for the round in which it is removed. These 
procedures will enhance bidder flexibility and may serve to expedite 
the course of the auction.
    95. Once a round closes, a bidder may no longer remove a bid. In 
the next round, however, a bidder may withdraw standing high bids from 
previous rounds using the ``withdraw bid'' function (assuming that the 
bidder has not exhausted its withdrawal allowance). A high bidder that 
withdraws its standing high bid from a previous round is subject to the 
bid withdrawal payments specified in 47 CFR 1.2104(g) and 1.2109. The 
procedure for withdrawing a bid and receiving a withdrawal confirmation 
is essentially the same as the bidding procedure described above in 
Part IV.B.(4).
    96. The Commission will limit the number of rounds in which bidders 
may place withdrawals to two rounds. These rounds will be at the 
bidder's discretion and there will be no limit on the number of bids 
that may be withdrawn in either of these rounds. Withdrawals will still 
be subject to the bid withdrawal payments specified in 47 CFR 1.2104(g) 
and 1.2109.
    97. If a high bid is withdrawn, the license will be offered in the 
next round at the second highest bid price, which may be less than or, 
in the case of tie bids, equal to, the amount of the withdrawn bid, 
without any bid increment. The FCC will serve as a ``place holder'' on 
the license until a new acceptable bid is submitted on that license.
b. Calculation
    98. Generally, a bidder that withdraws a standing high bid during 
the course of an auction will be subject to a payment equal to the 
lower of: (1) the difference between the net withdrawn bid and the 
subsequent net winning bid; or (2) the difference between the gross 
withdrawn bid and the subsequent gross winning bid for that license. No 
withdrawal payment will be assessed if a subsequent bid exceeds the 
withdrawn bid.
(7) Round Results
    99. The bids placed during a round are not published until the 
conclusion of that bidding period. After a round closes, the FCC will 
compile reports of all bids placed, bids withdrawn, current high bids, 
new minimum accepted bids, and bidder eligibility status (bidding 
eligibility and activity rule waivers), and post the reports for public 
access. Reports reflecting bidders' identities and bidder 
identification numbers for Auction No. 22 will be available before and 
during the auction. Thus, bidders will know in advance of this auction 
the identities of the bidders against which they are bidding.
(8) Auction Announcements
    100. The FCC will use auction announcements to announce items such 
as schedule changes and stage transitions. All FCC auction 
announcements will be available on the FCC remote electronic bidding 
system, as well as the Internet and the FCC Bulletin Board System.
(9) Other Matters
    101. As noted above in Part III.B., after the short-form filing 
deadline, applicants may make only minor changes to their FCC Form 175 
applications. For example, permissible minor changes include deletion 
and addition of authorized bidders (to a maximum of three) and revision 
of exhibits. Filers should make these changes on-line, and submit a 
letter to Amy Zoslov, Chief, Auctions and Industry Analysis Division, 
Wireless Telecommunications Bureau, Federal Communications Commission, 
2025 M Street, NW, Room 5202, Washington, DC 20554 (and mail a separate 
copy to Audrey Bashkin, Auctions and Industry Analysis Division), 
briefly summarizing the changes. Questions about other changes should 
be directed to Audrey Bashkin of the FCC Auctions and Industry Analysis 
Division at [phone].

V. Post-Auction Procedures

A. Down Payments and Withdrawn Bid Payments

    102. After bidding has ended, the Commission will issue a public 
notice declaring the auction closed, identifying the winning bids and 
bidders for each license, and listing bid withdrawal payments due.
    103. 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 Government to 20 percent of its net winning bids (actual bids 
less any applicable bidding credits). See 47 CFR 1.2107(b). In 
addition, by the same deadline all bidders must pay any bid withdrawal 
amounts due under 47 CFR 1.2104(g), as discussed above in Part 
IV.B.(6). (Upfront payments are applied first to satisfy any bid 
withdrawal liability, before being applied toward down payments.)

B. Long-Form Application

    104. Within ten business days after release of the auction closing 
notice, winning bidders must submit a properly completed long-form 
application and required exhibits for each license won in Auction No. 
22. Under Section 1.2112(b) of the Commission's Rules, winning bidders 
for C or F block licenses that are small businesses or very small 
businesses (or consortia of small businesses or very small businesses) 
must include an exhibit demonstrating their eligibility for bidding 
credits. Further filing instructions will be provided to auction 
winners at the close of the auction.

C. Default and Disqualification

    105. Any high 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 submit a timely long-
form application, fails to make full payment, or is otherwise 
disqualified) will be subject to the payments described in 47 CFR 
1.2104(g)(2). Under Section 1.2109 of the Commission's Rules, in such 
event the Commission may re-auction the license or offer it to the next 
highest bidders (in descending order) at their final bids. 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

[[Page 6902]]

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.

D. Refund of Remaining Upfront Payment Balances

    106. All applicants that submitted upfront payments for a license 
in Auction No. 22 may be entitled to a refund of their remaining 
upfront payment balance after the conclusion of the auction. No refund 
will be made unless there are excess funds on deposit from that 
applicant after any applicable bid withdrawal payments have been paid.
    107. Bidders that drop out of the auction completely may be 
eligible for a refund of their upfront payments before the close of the 
auction. However, bidders that reduce their eligibility and remain in 
the auction are not eligible for partial refunds of upfront payments 
until the close of the auction. Qualified bidders that have exhausted 
all of their activity rule waivers, have no remaining bidding 
eligibility, and have not withdrawn a high bid during the auction must 
submit a written refund request which includes wire transfer 
instructions, a Taxpayer Identification Number (``TIN''), and a copy of 
their bidding eligibility screen print, to: Federal Communications 
Commission, Billings and Collections Branch, Attn: Regina Dorsey or 
Linwood Jenkins, 445 12th Street, SW, Washington, DC 20554. Bidders can 
also fax their request to the Billings and Collections Branch at (202) 
418-2843. Once the request has been approved, a refund will be sent to 
the address provided on the FCC Form 159.

    Note: Refund processing generally takes up to two weeks to 
complete. Bidders with questions about refunds should contact 
Linwood Jenkins or Tim Dates at [phone].
    Federal Communications Commission.
Mark R. Bollinger,
Deputy Chief, Auctions and Industry Analysis Division, Wireless 
Telecommunications Bureau.
[FR Doc. 99-3334 Filed 2-10-99; 8:45 am]
BILLING CODE 6712-01-P