[Federal Register Volume 59, Number 99 (Tuesday, May 24, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-12165]
[[Page Unknown]]
[Federal Register: May 24, 1994]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 0 and 24
[PP Docket No. 93-253, FCC 94-98]
Competitive Bidding
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: The Commission has adopted rules establishing service-specific
rules for competitive bidding on licenses to be awarded for Personal
Communications Services in the 900 MHz band (``narrowband PCS''). This
action is taken to implement section 309(j) of the Communications Act
of 1934, as amended. The new rules will promote the development and
rapid deployment of new technologies, products, and services for the
benefit of the public, including those residing in rural areas. These
rules also will promote economic opportunity for small businesses and
businesses owned by women and/or minorities.
EFFECTIVE DATE: June 23, 1994.
FOR FURTHER INFORMATION CONTACT:
Toni Simmons, Federal Communications Commission, Office of Plans and
Policy, Washington, DC 20554 (202) 418-2030).
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Third
Report and Order, PP Docket No. 93-253, adopted April 20, 1994, and
released May 10, 1994. The full text of this Third Report and Order is
available for inspection and copying during normal business hours in
the FCC Dockets Branch, room 230, 1919 M Street, NW., suite 140,
Washington, DC. The complete text may be purchased from the
Commission's copy contractor, International Transcription Service,
Inc., 2100 M Street, NW., suite 140, Washington, DC 20037, Telephone
(202) 857-3800.
Paperwork Reduction Act
The Federal Communications Commission has submitted the following
information collection request to OMB for review and clearance under
the Paperwork Reduction Act of 1980, 44 USC section 3507. Persons
wishing to comment on this information collection should contact
Timothy Fain, Office of Management and Budget, room 3225, New Executive
Office Building, Washington, DC 20503, (202) 395-3561. For further
information, contact Judy Boley, Federal Communications Commission,
(202) 632-7513.
Please Note: The Commission has requested emergency review of this
collection by May 25, 1994, under the provisions of 5 CFR Sec. 1320.18.
Title: Implementation of section 309(J) of the Communications Act--
Competitive Bidding, Third Report and Order, PP Docket No. 93-253.
Action: New collections.
Respondents: Individuals, state or local governments, non-profit
organizations, business or other for-profit entities, including small
businesses.
Frequency of Response: On occasion.
Estimate Annual Burden:
------------------------------------------------------------------------
No. of Estimated
sections/ average hrs Estimated
forms per annual
respondents response burden
------------------------------------------------------------------------
Section 24.413(a)-(e)............. 17,770 1.00 17,770
Section 24.415.................... 3,554 1.00 3,554
Section 24.419.................... 50 20.00 1000
Section 24.425.................... 10 3.00 30
Section 24.406.................... 5,000 2 10,000
Section 24.439.................... 100 .50 50
Section 24.413(f)................. 2,500 2.5 6,250
Section 24.430.................... 100 20 2,000
-------------------------------------
Total Annual Burden........... ........... ........... 40,654
------------------------------------------------------------------------
Needs and Uses: In the Third Report and Order in PP Docket No. 93-
253 the Commission amended 47 CFR part 24 to add a new subpart F and G.
Subpart F contains the general rules and requirements governing the
competitive bidding process for narrowband PCS initial licenses.
Subpart G contains general rules and requirements for processing
applications. Applicants are required to file certain information so
that the Commission can determine whether the applicants are legally,
technically and financially qualified to be licensed. Affected members
of the public are any members of the public who wants to become a
licensee. The foregoing estimates include the time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collections of information. Send comments regarding these burden
estimates or any other aspect of the collections of information
including suggestions for reducing the burden to the Federal
Communications Commission, Records Management Division, Paperwork
Reduction Project, Washington, DC 20554 and to the Office of the
Management and Budget Paperwork Reduction Project, Washington, DC
20503.
Summary of the Third Report and Order
Introduction
1. In this Third Report and Order, we adopt service-specific rules
for competitive bidding on licenses to be awarded for Personal
Communications Services in the 900 MHz band (``narrowband PCS''). We
conclude that because of the significant interdependence among
narrowband PCS licenses and the relatively high expected value of such
licenses, most narrowband PCS licenses will be awarded through a
sequence of simultaneous multiple round auctions. We will also adopt a
system of preferences designed to enhance access to narrowband PCS
spectrum and achieve the congressional directive that our competitive
bidding rules ensure the opportunity of small businesses and businesses
owned by women and minorities to participate in the auction process.
2. Numerous comments and reply comments were filed by interested
parties in response to the notice of proposed rule making (58 FR 53489
(October 15, 1993)) in this docket. These comments address the many
proposals made in the notice regarding, among other things, narrowband
PCS licenses.
Auction Eligibility
3. In the Second Report and Order (59 FR 22980 (May 4, 1994)), we
concluded that narrowband PCS as a class of service was reasonably
likely to satisfy the criteria of section 309(j) of the Communications
Act. Also, the use of competitive bidding to award narrowband PCS
licenses as compared to other licensing methods will speed the
development and deployment of new services to the public and recover
for the public a portion of the value of the spectrum.
Auction Design
4. The spectrum allocation, service definition and technical rules
for narrowband PCS were completed by the Commission in the Narrowband
PCS Memorandum Opinion and Order (59 FR 14115 (March 25, 1994)). We
anticipated that advanced paging and messaging services would be the
predominant narrowband services provided. Three megahertz of spectrum
were allocated to narrowband PCS in three one megahertz bands (901-902
MHz, 930-931 MHz and 940-941 MHz). Two megahertz of this spectrum were
divided into 50 kHz and 12.5 kHz channels and will be available for
immediate licensing. The remaining one megahertz of narrowband PCS
spectrum will be channelized and licensed in the future as this service
develops.
5. Simultaneous multiple round auction. In This Report and Order,
we adopt simultaneous multiple round auctions as our primary auction
methodology for narrowband PCS licenses. We expect the value of most
narrowband PCS licenses to be sufficiently high to warrant the use of
simultaneous auctions. This type of auction will be most likely to
deploy rapidly new narrowband PCS technologies and services, promote
the development of competition for the provision of those and other
services, and thus foster economic growth. We recognize, however, that
simultaneous multiple round bidding may involve a greater degree of
complexity than other competitive bidding methods and that it may
present greater operational difficulties for both the Commission and
for bidders.
6. Alternative auction designs. Because narrowband PCS licenses
vary in terms of expected value and interdependence, we have determined
that no single competitive bidding design will be optimal for all
licenses. For this reason and because Congress directed us to test
multiple alternative methodologies, we will adopt other auction designs
as alternatives to our primary design. When we announce individual
auctions to award specific groups of narrowband licenses, we will issue
a public notice detailing the competitive bidding design and procedures
to be used.
7. Oral sequential and single round (sealed bid) auctions. If, as a
result of our auction experience, we determine that the operational
costs or complexities associated with simultaneous multiple round
auctions outweigh their benefits, we may decide to employ either oral
sequential auctions or single round sealed bid auctions. In an oral
sequential auction, licenses are put up for bid one at a time, so that
bidding ends on one item before it begins on the next item. Oral
sequential auctions generate valuable information about earlier
auctioned licenses, which can assist bidders in valuing later auctioned
licenses. However, if license values are interdependent oral sequential
auctions are less likely than simultaneous auctions to award
interdependent licenses to the parties who value them the most and to
aggregate licenses efficiently, because bidders for licenses that are
auctioned early must bid with less information about the value of
licenses to be auctioned later, and have less opportunity to pursue
backup bidding strategies. Nonetheless, because oral sequential
auctions are generally less complex, and costly both for the FCC and
for potential bidders, they may be appropriate to use where the
expected value of the narrowband PCS licenses to be auctioned is low
relative to the costs of conducting a more complex auction or where
interdependence is less significant.
8. We may find, for some narrowband PCS licenses that even the
lesser cost and complexity of oral sequential auctions are not
justified by the revenues these licenses would be expected to generate.
In such cases, we may choose to award licenses by single round sealed
bidding where bids for all licenses are submitted simultaneously and
the high bidder for each license is determined after a single round of
bidding. Single round sealed bidding has the principal advantage of
being relatively simple for bidders to understand and inexpensive for
the FCC to administer and also can generally be completed fairly
rapidly. However, because single round sealed bidding provides less
information and flexibility to bidders than either simultaneous or
sequential auctions, we will generally use this method only where there
is less interdependence among individual licenses or groups of licenses
and the expected value of the licenses to be auctioned is low relative
to the cost of conducting a more complex auction. In addition, we may
select this auction design where eligibility requirements limit
participation to relatively few bidders.
9. Combinatorial bidding. Although we recognize that there are
significant benefits associated with combinatorial bidding, especially
in terms of efficient aggregation of licenses, we conclude that
simultaneous multiple round auctions offer many of these same
advantages without the same degree of administrative and operational
complexity and without biasing auction outcomes in favor of combination
bids. Since simultaneous multiple round bidding is our preferred
auction method for awarding narrowband PCS licenses, we think
combinatorial bidding will be unnecessary in most narrowband PCS
auctions. However, in circumstances where we do not use simultaneous
multiple round bidding, we may permit combinatorial bidding.
Bidding Procedures
10. Grouping of licenses. Whether we use our preferred approach of
a sequence of simultaneous multiple round auctions or sequential
individual auctions, the Commission must choose which licenses will be
auctioned together. The importance of the choice of license grouping
increases with the degree of interdependence among the individual
licenses or groups of licenses to be auctioned. Accordingly, we will
group narrowband PCS licenses into the various simultaneous auctions by
aggregating together those licenses exhibiting the greatest degree of
interdependence so that there will be limited interdependence across
groups.
11. Based on the foregoing, we will auction narrowband PCS licenses
in the following license groupings. We will award all nationwide,
regional and MTA (other than MTA response channels) licenses through a
sequential series of simultaneous auctions. (However, as we gain
experience we may determine that an alternative auction method or
license grouping is more appropriate. Under these circumstances, as
provided in the general procedural rules, we will announce before each
auction the licenses to be auctioned and the type of competitive
bidding method to be used, as well as the stopping rules and activity
rules, if any, that will be used.) To maximize the information
available to bidders and increase gradually the complexity of the
narrowband PCS auctions as we gain more experience, we will begin by
auctioning the ten nationwide narrowband licenses in one simultaneous
multiple round auction. After the nationwide narrowband PCS auction is
complete, we will auction the five regional blocks (30 licenses)
together in one simultaneous multiple round auction. We subsequently
will conduct another simultaneous multiple round auction for all of the
50/50 kHz paired, 50/12.5 kHz paired and the 50 kHz unpaired MTA
licenses (357 licenses). Simultaneous multiple round auctions are
appropriate for each of these license groupings because of the
relatively high value and significant interdependence of the licenses.
12. After auctioning the MTA licenses, we will hold another
simultaneous multiple round auction for the 50/12.5 kHz paired BTA
licenses (984 licenses). Although most of the licenses are expected to
have relatively low values, individually they are highly
interdependent, and their aggregate value (compared to the cost of
conducting a simultaneous auction) is sufficiently high to justify a
simultaneous multiple round auction. Using this approach will also
enable the Commission to gain valuable experience conducting
simultaneous multiple round auctions involving large numbers of
licenses.
13. Finally, we will auction the 12.5 kHz unpaired MTA (204
licenses) and the 12.5 kHz unpaired BTA response channel licenses
(1,968 licenses) in a single round sealed bid auction because their
values are low relative to the cost of conducting other more complex
auctions. Under this auction method, however, bidders cannot be certain
that they will be the high bidder on all of the licenses they seek to
obtain because single round sealed bidding does not provides bidders
with timely information about license values and bidders do not have
the opportunity to increase their bid amounts during the course of the
auction. Therefore, in this context we will allow bidders to bid on
more licenses than they are eligible to be awarded under the existing
aggregation limits, provided they specify in advance the order in which
they wish to be awarded such licenses in the event that they are in
high bidder on more licenses then they are permitted to hold. See 47
CFR 24.130(a) (limiting paging licensees to a maximum of two response
channel licenses within the same geographic area). Bidders, however,
will only be permitted to bid on response channel licenses for which
they are otherwise eligible (i.e., they must operate at least one base
station in the service area of the response channel for which they are
applying). The Commission will only designate a bidder the winning
bidder on the maximum number of licenses the bidder is eligible to
hold. Under these circumstances, a high bidder will not be subject to
the bid withdrawal penalty for those additional licenses for which it
is not designated the winning bidder.
14. Bid increments. Where we use simultaneous multiple round
auctions to award narrowband PCS licenses it is important to specify
minimum bid increments. In these auctions, we may impose a minimum bid
increment of 5 percent or $0.01 per pop per MHz, whichever is greater.
This will provide flexibility for a wide range of different license
values and will ensure timely closure of auctions, even where bidding
begins at a very low dollar amount. The Commission retains the
discretion in narrowband PCS auctions to set and, by announcement
before or during the auction, vary the minimum bid increments for
individual licenses or groups of licenses over the course of an
auction. We will most likely reduce the minimum bid increment only in
the later bidding rounds, as bidding begins to come to a close. In oral
sequential auctions the auctioneer may within its sole discretion
establish and vary the amount of the minimum bid increment in each
round of bidding.
15. Stopping rules for multiple round auctions. Where we use
simultaneous multiple round bidding, we believe that a simultaneous
stopping rule is preferable, especially for the nationwide, regional
and MTA narrowband PCS licenses, which are expected to have relatively
high values and are fewer in number. Because of the large number of BTA
licenses and their relatively low expected value, we may use either a
hybrid stopping rule or allow markets to close individually in auctions
for these licenses.
16. We will retain the discretion to declare at any point in a
simultaneous multiple round auction that the auction will end after one
additional round or some other specified number of additional rounds.
We also reserve the discretion to vary the duration of bidding rounds
or the interval at which bids are accepted in order to move the auction
toward closure more quickly. We will announce by public notice, and may
vary by announcement during an auction, the duration and intervals
between bidding rounds.
17. Activity rules. In order to ensure that simultaneous auctions
with simultaneous stopping rules close within a reasonable period of
time, it is necessary to impose an activity rule to prevent bidders
from waiting until the end of the auction before participating. The
rule proposed by Professors Paul Milgrom and Robert Wilson (``Milgrom-
Wilson rule'') will best achieve the Commission's goal of affording
bidders flexibility to pursue back up strategies, while at the same
time ensuring that simultaneous auctions are concluded within a
reasonable period of time. Therefore, to award higher value narrowband
PCS licenses, we plan to use the Milgrom-Wilson rule with a
simultaneous stopping rule.
18. Under the Milgrom-Wilson rule, the minimum activity level,
measured as a fraction of the self declared maximum eligibility, would
increase during the course of the auction. The auction would be divided
into three stages. During the first stage of the auction, bidders would
be required to be active on licenses encompassing at least one-third of
the MHz-pops for which they are eligible. In the second stage, bidders
would be required to be active on licenses encompassing at least two-
thirds of the MHz-pops for which they are eligible. In the third stage,
bidders would be required to be active on licenses encompassing 100
percent of the MHz-pops for which they are eligible. Under this rule,
bidders would be required to meet these activity levels to retain their
desired eligibility. A shortfall in activity would reduce eligibility
levels accordingly. However, bidders will be permitted five automatic
waivers from the activity rule during the course of an auction. We also
retain the discretion to use less complex activity rules.
Procedural, Payment, and Penalty Matters
19. Pre-auction procedures. We will follow the procedural, payment
and penalty rules established in the Second Report and Order with
certain minor modifications designed to address the characteristics of
the narrowband PCS service. Before each scheduled narrowband PCS
auction the Commission, or pursuant to delegated authority, a Bureau
will release an initial Public Notice announcing the auction. This
initial Public Notice will specify the license(s) to be auctioned and
the time, place and method of competitive bidding to be used, including
applicable bid procedures. The initial public notice will also specify
the filing deadline for short-form applications.
20. All bidders will be required to submit short-form applications
on FCC Form 175 by the date specified in the public notice. If only one
application is received, the Commission will by public notice cancel
the auction for this license and establish a date for the filing of a
long-form application, the acceptance of which will trigger the
procedures permitting petitions to deny. The Commission will issue a
second Public Notice listing all defective applications and applicants
will be given a chance to cure and resubmit applications with minor
defects.
21. After reviewing the corrected applications, the Commission will
release a third public notice announcing the names of all applicants
whose applications have been accepted. These applicants will then be
required to submit the full amount of their upfront payment to the
Commission's lock-box bank by a date specified in the public notice. A
fourth public notice announcing the names of all applicants that have
been determined to be qualified to bid will then be issued. Each of
these applicants will receive a bidder identification number and
further instructions regarding auction procedures.
22. Upfront payments. We will require all auction participants to
tender in advance to the Commission an upfront payment as a condition
of bidding. We believe that a standard upfront payment formula of $0.02
per pop per MHz for the largest combination of MHz-pops a bidder
anticipates bidding on in any single round of bidding is appropriate
for narrowband PCS services. If licenses covering the nation are being
auctioned simultaneously, a bidder will not be required to file an
upfront payment representing national coverage unless it intends to bid
on licenses covering the entire nation in any single bidding round. We
will announce the upfront payment amount for each license in a public
notice issued prior to the auction.
23. We believe that the minimum upfront payment of $2,500
established in the Second Report and Order may be too high for some
narrowband licenses in sparsely populated areas, which may have values
below this amount. Therefore, we will establish a lower minimum upfront
payment of $1,000 for narrowband PCS applications. The specific
procedures to be followed in the tendering and processing of upfront
payments are set forth in Section 1.2106 of the Commission's rules.
24. Down payment and full payment for licenses awarded by
competitive bidding. Winning bidders will be required to supplement
their upfront payments with a down payment sufficient to bring their
total deposits up to 20 percent of their winning bid(s). The down
payment must be submitted by cashier's check or wire transfer to our
lock-box bank by a date specified, generally within five business days
following the close of the bidding. All auction winners, with the
exception of certain designated entities, will be required to make full
payment of the balance of the winning bids within five business days
following the award of the license. Small Businesses will be permitted
to pay 10 percent of their down payment amount within five businesses
days after bidding is closed and the remaining 10 percent within five
days after grant of the license. As discussed below, small businesses
will also be permitted to pay the balance of their winning bid amount
for certain licenses in installments over the term of the license.
License grants will be conditioned on full payment of the bid amount.
25. Default and disqualification. Any bidder who withdraws a high
bid during an auction before bidding closes, or defaults by failing to
remit the required down payment within the prescribed time, will be
required to reimburse the Commission in the amount of the difference
between its high bid and the amount of the winning bid the next time
the license is auctioned, if the subsequent winning bid is lower. After
bidding closes, a defaulting or disqualified auction winner will be
assessed an additional penalty of three percent of the subsequent
winning bid or three percent of the amount of the defaulting bid,
whichever is less. Deposits will be held by the FCC until full payment
of the penalty. If default of disqualification involves such actions as
gross misconduct, the Commission may declare the applicant ineligible
to bid in future auctions and may take other actions including the
revocation of Commission licenses.
26. If the down payment is timely made, a long-form application
filed on FCC form 401 (as modified) will be required to be filed by a
specified date, generally within 10 business days after the close of
the auction. Upon acceptance for filing of the long-form application,
the FCC will release a public notice announcing this fact thus
triggering the filing window for petitions to deny. If the petitions to
deny are denied, and the FCC finds the applicant qualified, the license
will be granted to the auction winner.
27. As proposed, we adopt a modified version of the application
requirements and processing rules in part 22 of the Commission's rules
for narrowband PCS. These rules govern such matters as application
filing and content requirements, waiver procedures, procedures for
returning defective applications, and procedures regarding the
modification of applications.
28. With regard to petitions to deny, we adopt expedited procedures
consistent with the provisions of section 309(i)(2) of the
Communications Act for narrowband PCS applications. A hearing need not
be conducted before denial of a petition to deny if the Commission
determines that an applicant is not qualified and no substantial issue
of fact exists concerning that determination. If the FCC identifies
substantial and material issues of fact in need of resolution, section
309(i)(2) of the Act permits in any hearing submission for all or part
of the evidence in written form and allows employees other than
administrative law judges to conduct hearings.
29. As a general rule, when an auction winner defaults or is
otherwise disqualified after having made the required down payment, the
best course of action is to re-auction the license either to existing
or new applicants. However, if the default occurs within five (5)
businesses days after bidding has closed, the Commission retains the
discretion to offer the license to the second highest bidder at its
final bid level, or if that bidder declines the offer, to offer the
license to other bidders (in descending order of their bid amounts) at
their final bid levels.
30. If a new auction becomes necessary because of default or
disqualification more than five (5) business days after bidding has
ended the Commission will afford new parties an opportunity to file
applications because so much time is likely to have passed that
different parties may be interested in bidding and existing applicants
may have different valuations of the license.
Procedures in Other Auction Designs
31. Single round bidding. Where we use sealed bidding, in addition
to the information specified above, the initial public notice will
specify the date on which sealed bids must be submitted. In single
round sealed bid auctions, we will not require bidders to submit
upfront payments because we believe that there is less risk of
frivolous bidding when this auction design is used. We may, however,
announce by public notice that bidders must tender the 20 percent down
payment at the time they submit their buds in order to ensure payment
of the penalty in case of bid withdrawal or default. In single round
sealed bid auctions, we will require that bids be received on a date
specified in the public notice and that bids clearly indicate the
bidder's identification number and the auction and license to which the
bid relates. Bidders submitting bids for more licenses than they are
permitted to hold must also specify the order in which they wish to be
awarded such licenses if they are the high bidder on more licenses then
they are eligible to hold. After bids are submitted and evaluated, the
Commission will issue a second public notice indicating all bidders who
have made timely bid submissions. After release of the second public
notice, the Commission will issue a third public notice announcing the
high bidders on each license. (If a tie occurs, bidders will be
afforded the opportunity to submit another bid and the highest bidder
in this round will be designated the winning bidder.) If the 20 percent
deposit has not already been submitted, then the high bidder will be
required to submit the 20 percent down payment within five (5) business
days after release of the public notice announcing the high bidders (if
the 20 percent down payment has already been submitted, the Commission
will simply deposit the high bidder's down payment).
32. In the case of single round bidding, the withdrawal and default
penalties must be modified to reflect the fact that bids cannot be
withdrawn during the course of an auction because there is only a
single round of bidding. In this context, if a bid is withdrawn before
the Commission releases the public notice announcing the high bidders,
no harm is likely to occur and no penalty will be assessed because the
Commission can easily designate in the public notice that the party
with the next highest bid is the winning bidder. If, however, a high
bidder in a single round auction defaults after release of the public
notice announcing the high bidders, the licensing process is likely to
be delayed. Therefore, in order to encourage bidders in single round
auctions to avoid default and the associated delays, we will impose a
default penalty if a high bidder withdraws, defaults or is otherwise
disqualified after release of the public notice announcing the winning
bidders. This penalty will be equal to the difference between the high
bid amount and the amount of the next highest valid bid. A bid will be
considered valid for this purpose if the bidder has not already been
designated the winning bidder on more licenses than it is permitted to
be awarded.
33. Bidders will be held to their bids on the maximum number of
licenses they are permitted to hold. If there are multiple defaults
each bidder will be responsible for the difference between its bid and
the amount of the next highest valid bid. Holding each bidder in a
single round auction responsible for the difference between its bid and
the next highest valid bid will discourage cascading defaults, without
penalizing bidders for bidding on more licenses than they are permitted
to hold. Losing bidders, may decline a defaulted license without
penalty if such default occurs more than 30 days after the Commission
releases the initial public notice announcing the winning bidders.
Where a bidder defaults or is disqualified more than 30 days after the
release of the initial public notice announcing the winning bidders the
Commission retains the discretion to either offer the license to the
bidder with the next highest valid bid at its original bid price or re-
auction the license. If the Commission re-auctions the license, new
applications will be accepted and the additional three percent penalty
will apply.
34. Oral sequential auctions. Where oral sequential bidding is
employed, the general procedures described above will be followed with
one exception. Qualified bidders will be required to bring a cashier's
check for the full amount of their upfront payment to the auction site.
Bidders will be required to display their upfront payment check as a
condition of being issued a bidder identification number and admittance
to the bidder section of the auction site. After bidding closes on a
particular license, the high bidder will be asked to tender its upfront
payment and sign a bid confirmation form. If the high bidder declines
to tender the upfront payment and/or refuses to sign the bid
confirmation form, no penalty will be assessed because the license
would be immediately re-auctioned. The only damage from such withdrawal
would be delay. And in an oral sequential auction such delay may be
minimal. The standard default penalty and the additional three percent
penalty will be assessed, however, if the bidder defaults on the 20
percent down payment, fails to pay for the license or is disqualified
after the close of an auction.
Regulatory Safeguards
35. Unjust enrichment provisions. The transfer disclosure
requirements in section 1.2111(a) of our rules, adopted in the Second
Report and Order, will apply to all narrowband PCS licenses obtained
through the competitive bidding process. Generally, applicants
transferring their licenses within three years after the initial
license grant will be required to file, together with their transfer
application, the associated contracts for sale and all other documents
disclosing the total consideration received in return for the transfer
of its license.
36. Performance requirements. The narrowband PCS service rules
contain specific performance requirements, such as the requirement to
construct within a specified period of time. Failure to satisfy these
construction requirements will result in forfeiture of the license.
Therefore, additional performance requirements are not necessary.
37. Rules prohibiting collusion. The rules prohibiting collusion,
adopted in the Second Report and Order, apply to all auctionable
services including narrowband PCS. Bidders will generally be required
to identify on their Form 175 applications all parties with whom they
have arrangements or agreements which relate to the competitive bidding
process. Bidders will also be required to provide certifications that
they have entered into no other agreements. After the short-form
application is filed, and prior to the down payment of a winning bid,
bidders are prohibited from collaborating or discussing the substance
of their bids or bidding strategies with bidders not members of a
bidding consortium previously identified in the short-form application.
38. Winning bidders are required to attach as an exhibit to the
Form 401 application a detailed explanation of the terms, conditions
and parties in any agreement relating to the competitive bidding
process. All such arrangements must have been entered into prior to the
filing of short-form applications. Specific instances of collusion in
the competitive bidding process may result in investigation by the FCC
or referral to the United States Department of Justice for
investigation. Adjudicated violations of our rules or the anti-trust
laws may result in forfeiture of payments, license revocations and
prohibition from participation in future auctions.
Designated Entity Preferences
39. Bidding credits. In this Report and Order, we adopt specific
preferences for narrowband PCS designed to ensure that designated
entities are given the opportunity to participate in the competitive
bidding process and the provision of narrowband PCS services. We will
make a 25 percent bidding credit available to businesses owned by women
and minorities bidding on the following licenses: (1) The nationwide
license on Channel 5, Channel 8 and Channel 11; (2) all regional
licenses on Channel 13 and Channel 17; (3) all MTA licenses on Channel
19, Channel 22, Channel 24; and (4) all BTA licenses on Channel 26.
40. Given the history of under-representation of minorities and
women in telecommunications and the inability of these groups to access
financing, we find that the best way we can accomplish these statutory
mandates is to provide bidding credits exclusively to minority and
female-owned businesses, regardless of their status as small or large
entities. We think that a 25 percent bidding credit is sufficient to
ensure minority and female entry. It is not so substantial, however, as
to foster participation by firms that are not otherwise financially
capable of building-out a narrowband PCS network. We will also monitor
carefully the effectiveness of the 25 percent bidding credit in the
narrowband PCS auctions and continually assess whether it is achieving
the goal of ensuring that minority and women-owned firms participate
successfully in auctions for this service.
41. To prevent unjust enrichment by women and minorities
trafficking in licenses acquired through the use of bidding credits, we
will impose a forfeiture requirement on transfers of such licenses to
entities that are not owned by women or minorities. The penalty
required will be reimbursement to the government for the amount of the
bidding credit, plus interest, before transfer will be permitted. The
amount of the penalty will be reduced over time. To ensure that only
legitimate minority and women-owned firms are able to take advantage of
bidding credits, strict eligibility criteria have been adopted (in the
Second Report and Order). Also, to ensure that our rules are narrowly
tailored while meeting the statutory goal of providing opportunities
for women and minorities to participate in the telecommunications
industry, publicly-traded companies are prohibited from taking
advantage of bidding credits.
42. Tax certificates. Tax certificates will be issued to initial
investors in minority and female-owned enterprises upon divestiture of
their interests, and to licensees who transfer their authorizations to
minority and female-owned businesses. In implementing this program, we
will borrow from our existing tax certificate program and grant tax
certificates, upon request, that will enable the licensees and
investors to defer the gain realized upon a sale either by: (1)
Treating it as an involuntary conversion under 26 U.S.C. 1033, with the
recognition of gain avoided by the acquisition of qualified replacement
property; or (2) electing to reduce the basis of certain depreciable
property, or both.
43. Tax certificates will be available to initial investors who
provide ``start-up'' financing and investors who purchase shares within
the first year after license issuance. To be eligible for a tax
certificate, such investor transactions must not reduce minority or
female ownership or control in the entity below 50.1 percent. To
prevent unjust enrichment, we will impose a one-year holding
requirement on the transfer or assignment of narrowband PCS licenses
obtained thorough the benefit of tax certificates.
44. Installment payments. We adopt installment payments for small
businesses--including small businesses owned by women and minorities
and rural telephone companies that meet the small business definition--
bidding for any of the BTA, MTA or regional narrowband PCS licenses.
These licenses are appropriately sized for development by bona fide
small businesses. We estimate that the cost to build-out these licenses
will be between $50,000 and $1.25 million.
45. The installment payment option will enable all small businesses
to pay the full amount of their winning bid in installments (less the
upfront payment, which must be paid in full, and the down payment, half
of which is due five days after the auction closes and the other half
five days after the application is granted). Generally, interest
charges will be fixed at the time of licensing at a rate equal to the
rate for 10 year U.S. Treasury obligations. Payments of interest only
will be due for the first two years. Principal and interest will be
amortized over the remaining years of the license. Timely payment of
all installments will be a condition of the license grant. If a small
business making installment payments seeks to transfer a license to a
non-small business entity during the term of the license, we will
require payment of the remaining principal balance as a condition of
the license transfer.
Final Regulatory Flexibility Analysis
Need for and Purpose of the Action
46. This rulemaking proceeding was initiated to implement section
309(j) of the Communications Act, as amended. The rules adopted herein
will carry out Congress' intent to establish a system of competitive
bidding for narrowband PCS licenses. The rules adopted herein also will
carry out Congress' intent to ensure that small businesses, rural
telephone companies, and businesses owned by women and minorities are
afforded an opportunity to participate in the provision of spectrum-
based services.
Issues Raised in Response to the Initial Regulatory Flexibility
Analysis
47. The IRFA noted that the proposals under consideration in the
NPRM included the possibility of new reporting and recordkeeping
requirements for a number of small business entities. No commenters
responded specifically to the issues raised in the IRFA. We have made
some modifications to the proposed requirements as appropriate.
Significant Alternatives Considered and Rejected
All significant alternatives have been addressed in the Second
Report and Order.
Federal Communications Commission.
William F. Caton,
Acting Secretary.
List of Subjects
47 CFR Part 0
Organization and functions (Government agencies).
47 CFR Part 24
Communications common carriers, Communications equipment, Radio,
Reporting and recordkeeping requirements.
Amendatory Text
Parts O and 24 of chapter I of title 47 of the Code of Federal
Regulations are amended as follows:
PART O--COMMISSION ORGANIZATION
1. The authority citation for part O continues to read as follows:
Authority: Sec. 5, 48 Stat. 1068, as amended; 47 U.S.C. 155.
2. Section 0.91 is amended by adding a new paragraph (n) to read as
follows:
Sec. 0.91 Functions of the Bureau.
* * * * *
(n) Develops, in coordination with the Office of Plans and Policy,
policies for the selection of licenses from mutually exclusive
applicants in the Common Carrier Service subject to competitive
bidding; issues Public Notices announcing auctions for Common Carrier
Service Licenses; specifies the licenses to be auctioned; the deadlines
for filing short-form applications, filing fees, and submission of
upfront payments; the time and place of the auction; the method of
competitive bidding to be used; competitive bidding procedures
including, but not limited to, designated entity preferences,
applicable bid submission procedures, upfront payment requirements,
activity rules, stopping rules, and bid withdrawal procedures.
PART 24--PERSONAL COMMUNICATIONS SERVICES
3. The authority citation for part 24 is revised to read as
follows:
Authority: 47 U.S.C. 154, 301, 302, 303, 309 and 332, unless
otherwise noted.
4. Section 24.10 is revised to read as follows:
Sec. 24.10 Scope.
This subpart contains some of the procedures and requirements for
filing applications for licenses in the personal communications
services. You should also consult subparts F and G of this part. Other
Commission rule parts of importance that may be referred to with
respect to licensing and operation of radio services governed under
this part include 47 CFR parts 0, 1, 2, 5, 15, 17 and 20.
5. Section 24.129 is revised to read as follows:
Sec. 24.129 Frequencies.
The following frequencies are available for narrowband PCS. All
licenses on channels indicated with an (**) will be eligible for
bidding credits as set forth in section 24.309(b) of this part if
competitive bidding is used to award such licenses.
(a) Eleven frequencies are available for assignment on a nationwide
basis as follows:
(1) Five 50 kHz channels paired with 50 kHz channels:
Channel 1: 940.00-940.05 and 901.00-901.05 MHz;
Channel 2: 940.05-940.10 and 901.05-901.10 MHz;
Channel 3: 940.10-940.15 and 901.10-901.15 MHz;
Channel 4: 940.15-940.20 and 901.15-901.20 MHz; and,
Channel 5: 940.20-940.25 and 901.20-901.25 MHz.**
(2) Three 50 kHz channels paired with 12.5 kHz channels:
Channel 6: 930.40-930.45 and 901.7500-901.7625 MHz;
Channel 7: 930.45-930.50 and 901.7625-901.7750 MHz; and,
Channel 8: 930.50-930.55 and 901.7750-901.7875 MHz.**
(3) Three 50 kHz unpaired channels:
Channel 9: 940.75-940.80 MHz;
Channel 10: 940.80-940.85 MHz; and,
Channel 11: 940.85-940.90 MHz.**
(b) Six frequencies are available for assignment on a regional
basis as follows:
(1) Two 50 kHz channels paired with 50 kHz channels:
Channel 12: 940.25-940.30 and 901.25-901.30 MHz; and,
Channel 13: 940.30-940.35 and 901.30-901.35 MHz.**
(2) Four 50 kHz channels paired with 12.5 kHz channels:
Channel 14: 930.55-930.60 and 901.7875-901.8000 MHz;
Channel 15: 930.60-930.65 and 901.8000-901,8125 MHz;
Channel 16: 930.65-930.70 and 901.8125-901.8250 MHz; and,
Channel 17: 930.70-930.75 and 901.8250-901.8375 MHz.**
(c) Seven frequencies are available for assignment on a MTA basis
as follows:
(1) Two 50 kHz channels paired with 50 kHz channels:
Channel 18: 940.35-940.40 and 901.35-901.40 MHz; and,
Channel 19: 940.40-940.45 and 901.40-901.45 MHz.**
(2) Three 50 kHz channels paired with 12.5 kHz channels:
Channel 20: 930.75-930.80 and 901.8375-901.8500 MHz;
Channel 21: 930.80-930.85 and 901.8500-901.8625 MHz; and,
Channel 22: 930.85-930.90 and 901.8625-901.8750 MHz.**
(3) Two 50 kHz unpaired channels:
Channel 23: 940.90-940.95 MHz; and,
Channel 24: 940.95-941.00 MHz.**
(d) Two 50 kHz channels paired with 12.5 kHz channels are available
for assignment on a BTA basis:
Channel 25: 930.90-930.95 and 901.8750-901.8875 MHz; and,
Channel 26: 930.95-931.00 and 901.8875-901.9000 MHz.**
Note 1: Operations in markets or portions of markets which
border other countries, such as Canada and Mexico, will be subject
to on-going coordination arrangements with neighboring countries.
6. Sections 24.130 (b) and (c) are revised to read as follows
Sec. 24.130 Paging response channels.
* * * * *
(b) The following four 12.5 kHz unpaired channels are available for
assignment on a MTA basis:
Channel A: 901.9000-901.9125 MHz;
Channel B: 901.9125-901.9250 MHz;
Channel C: 901.9250-901.9375 MHz; and,
Channel D: 901.9375-901.9500 MHz.
(c) The following four 12.5 kHz unpaired channels are available for
assignment on a BTA basis.
Channel E: 901.9500-901.9625 MHz;
Channel F: 901.9625-901.9750 MHz;
Channel G: 901.9750-901.9875 MHz; and,
Channel H: 901.9875-902.0000 MHz.
7. Part 24 is amended by adding a new subpart F consisting of
Secs. 23.301 through 24.309 to read as follows:
Subpart F--Competitive Bidding Procedures for Narrowband PCS
Sec.
24.301 Narrowband PCS subject to competitive bidding.
24.302 Competitive bidding design for narrowband PCS licensing.
24.303 Competitive bidding mechanisms.
24.304 Withdrawal, default and disqualification penalties.
24.305 Bidding applications (FCC Form 175 and 175-S Short-Form).
24.306 Submission of upfront payments and downpayments.
24.307 Long-Form applications.
24.308 License grant, denial, default, and disqualification.
24.309 Designated entities.
Subpart F--Competitive Bidding Procedures for Narrowband PCS
Sec. 24.301 Narrowband PCS subject to competitive bidding.
Mutually exclusive initial applications to provide narrowband PCS
service are subject to competitive bidding procedures. The general
competitive bidding procedures found in 47 CFR part 1, subpart Q, will
apply unless otherwise provided in this part.
Sec. 24.302 Competitive bidding design for narrowband PSC licensing.
(a) The Commission will employ the following competitive bidding
designs when choosing from among mutually exclusive initial
applications to provide narrowband PCS service:
(1) Single round sealed bid auctions (either sequential or
simultaneous);
(2) Sequential oral auctions;
(3) Simultaneous multiple round auctions.
(b) The Commission may design and test alternative procedures. The
Commission will announce by Public Notice before each auction the
competitive bidding design to be employed in a particular auction.
(c) The Commission may use combinatorial bidding, which would allow
bidders to submit all or nothing bids on combinations of licenses, in
addition to bids on individual licenses. The Commission may require
that to be declared the high bid, a combinatorial bid must exceed the
sum of the individual bids by a specified amount. Combinatorial bidding
may be used with any type of auction design.
(d) The Commission may use single combined auctions, which combine
bidding for two or more substitutable licenses and award licenses to
the highest bidders until the available licenses are exhausted. This
technique may be used in conjunction with any type of auction.
Sec. 24.303 Competitive bidding mechanisms.
(a) Sequencing. The Commission will establish and may vary the
sequence in which narrowband PCS licenses will be auctioned.
(b) Grouping. In the event the Commission uses either a
simultaneous multiple round competitive bidding design or combinatorial
bidding, the Commission will determine which licenses will be auctioned
simultaneously or in combination.
(c) Reservation Price. The Commission may establish a reservation
price, either disclosed or undisclosed, below which a license subject
to auction will not be awarded.
(d) Minimum Bid Increments. The Commission may, by announcement
before or during an auction, require minimum bid increments in dollar
or percentage terms.
(e) Stopping Rules. The Commission may establish stopping rules
before or during multiple round auctions in order to terminate an
auction within a reasonable time.
(f) Activity Rules. The Commission may establish activity rules
which require a minimum amount of bidding activity. In the event that
the Commission establishes an activity rule in connection with a
simultaneous multiple round auction, each bidder will be entitled to
request and will be automatically granted five (5) waivers of such rule
during the course of a single auction.
Sec. 24.304 Withdrawal, default and disqualification penalties.
(a) When the Commission conducts a simultaneous multiple round
auction pursuant to Sec. 24.302(a)(3), the Commission will impose
penalties on bidders who withdraw high bids during the course of an
auction, or who default on payments due after an auction closes or who
are disqualified.
(1) Bid withdrawal prior to close of auction. A bidder who
withdraws a high bid during the course of an auction will be subject to
a penalty equal to the difference between the amount bid and the amount
of the winning bid the next time the license is offered by the
Commission. No withdrawal penalty would be assessed if the subsequent
winning bid exceeds the withdrawn bid. This penalty amount will be
deducted from any upfront payments or down payments that the
withdrawing bidder has deposited with the Commission.
(2) Default or disqualification after close of auction. If a high
bidder defaults or is disqualified after the close of such an auction,
the defaulting bidder will be subject to the penalty in paragraph
(a)(1) of this section plus an additional penalty equal to three (3)
percent of the subsequent winning bid. If the subsequent winning bid
exceeds the defaulting bidder's bid amount, the 3 percent penalty will
be calculated based on the defaulting bidder's bid amount. These
amounts will be deducted from any upfront payments or down payments
that the defaulting or disqualified bidder has deposited with the
Commission.
(b) When the Commission conducts single round sealed bid auctions
or sequential oral auctions, the Commission may modify the penalties to
be paid in the event of bid withdrawal, default or disqualification;
provided, however, that such penalties shall not exceed the penalties
specified above.
(c) In the case of single round bidding for narrowband PCS
licenses:
(1) If a bid is withdrawn before the Commission releases the
initial public notice announcing the winning bidder(s), no bid
withdrawal penalty will be assessed.
(2) If a bid is withdrawn after the Commission releases the initial
public notice announcing the winning bidder(s), the bid withdrawal
penalty will be equal to the difference between the high bid amount and
the amount of the next highest valid bid. A bid will be considered
valid for this purpose if the bidder has not already been designated
the winning bidder on more licenses than it is permitted to be awarded.
Losing bidders will only be subject to this bid withdrawal penalty for
a period of 30 days after the Commission releases the initial public
notice announcing the winning bidders.
(d) In the case of oral sequential bidding for narrowband PCS
licenses:
(1) If a bid is withdrawn before the Commission has declared the
bidding to be closed for the license bid on, no bid withdrawal penalty
will be assessed.
(2) If a bid is withdrawn after the Commission has declared the
bidding to be closed for the license bid on, the bid withdrawal penalty
of Sec. 1.2104(g) and paragraphs (a) (1) and (2) of this section will
apply.
Sec. 24.305 Bidding application (FCC Form 175 and 175-S Short-Form).
All applicants for initial provision of narrowband PCS service must
submit applications on FCC Forms 175 and 175-S pursuant to the
procedures set forth in Sec. 1.2105 of part 1 of this chapter. The
Commission will issue a public notice announcing the date of a
narrowband PCS auction, the licenses which are to be auctioned, and the
date on or before which applicants intending to participate in an
upcoming narrowband PCS auction must file their applications in order
to be eligible for that auction. The public notice will also contain
information necessary for completion of the application as well as
other important information such as the materials which must accompany
the Forms, any filing fee that must accompany the application or any
upfront payment that will need to be submitted, and the location where
the application must be filed.
Sec. 24.306 Submission of upfront payments and down payments.
(a) Where the Commission uses simultaneous multiple round auctions
or oral sequential auctions bidders will be required to submit an
upfront payment pursuant to the procedures set forth in Sec. 1.2106 of
this chapter.
(b) Winning bidders in an auction must submit a down payment to the
Commission in accordance with the procedures set forth in Sec. 1.2107
(a) and (b) of this chapter.
Sec. 24.307 Long-Form applications.
Winning bidders will be required to submit long form applications
on FCC Form 401, as modified, within ten (10) business days after being
notified that they are the winning bidder. Applications on FCC Form 401
shall be submitted pursuant to the procedures set forth in subpart G of
this part and Sec. 1.2107 (c) and (d) of this chapter and any
associated public notices. Only auction winners will be eligible to
file applications on FCC Form 401 for initial narrowband PCS licenses
in the event of mutual exclusivity between applicants filing Form 175.
Winning bidders need not complete Schedule B to Form 401.
Sec. 24.308 License grant, denial, default, and disqualification.
(a) Winning Bidders are required to pay the balance of their
winning bid in a lump sum payment within five (5) business days
following the award of the license. Grant of the license will be
conditioned upon full and timely payment of the winning bid amount.
(b) A bidder who withdraws its bid, defaults on a payment or is
disqualified will be subject to the penalties specified in Sec. 1.2109
of this chapter.
Sec. 24.309 Designated entities.
Designated entities entitled to preferences in the narrowband PCS
service are small businesses and businesses owned by members of
minority groups and/or women as defined in Sec. 1.2110(b) of this
chapter.
(a) Installment payments. Small businesses, including small
businesses owned by women and/or minorities, will be eligible to pay
the full amount of their winning bid on any regional, MTA or BTA
license in installments over the term of the license pursuant to the
terms set forth in Sec. 1.2110(d) of this chapter.
(b) Bidding credits. Businesses owned by women and/or minorities,
including small businesses owned by women and/or minorities will be
eligible for a twenty-five percent (25) bidding credit when bidding on
the following licenses:
(1) The nationwide licenses on Channel 5, Channel 8 and Channel 11;
(2) All regional licenses on Channel 13 and Channel 17;
(3) All MTA licenses on Channel 19, Channel 22, Channel 24; and
(4) All BTA licenses on Channel 26. See 47 CFR 24.129.
The bidding credit will reduce by 25 percent the bid price that
businesses owned by women and/or minorities will be required to pay to
obtain a license. The licenses that will be eligible for bidding
credits are indicated by an (**) in Sec. 24.129.
(c) Tax certificates. Any initial investor in a business owned by
minorities and/or women and who provides ``start-up'' financing, which
allows such business to acquire a narrowband PCS license(s), and any
investor who purchases an ownership interest in a narrowband PCS
licensee owned by minorities and/or women within the first year after
license issuance, which allows for the stabilization of the entity's
capital base, may, upon the sale of such investment or interest,
request from the Commission a tax certificate, so long as such investor
transaction does not reduce minority or female ownership or control in
the entity below 50.1 percent. Any narrowband PCS licensee who assigns
or transfers control of its license to a business owned by minorities
and/or women may request that the Commission issue it a tax
certificate.
(d) Unjust enrichment. Designated entities using installment
payments, bidding credits or tax certificates to obtain a narrowband
PCS license will be subject to the following unjust enrichment
provisions:
(1) If a small business paying for a narrowband PCS license in
installment payments seeks to transfer a license to a non-small
business entity during the term of the license, the remaining principal
balance must be repaid as a condition of the license transfer.
(2) Female and minority-owned businesses seeking to transfer a
license to an entity that is not owned by women or minorities will be
required to reimburse the government for the amount of the bidding
credit, plus interest at the rate imposed for installment financing at
the time the license was awarded, before transfer will be permitted.
The amount of this penalty will be reduced over time as follows: a
transfer in the first two years of the license term will result in a
forfeiture of 100 percent of the value of the bidding credit; in year
three of the licenses term the penalty will be 75 percent; in year four
the penalty will be 50 percent and in year five the penalty will be 25
percent, after which there will be no penalty.
(3) Any business owned by minorities and or women that obtains a
narrowband PCS license through the benefit of tax certificates shall
not assign or transfer control of its license within one year of its
license grant date. If the assignee or transferee is a business owned
by minorities and or women, this paragraph shall not apply; Provided,
however, that the assignee or transferee shall not assign or transfer
control of the license within one year of the grant date of the
assignment or transfer.
8. Part 24 is amended by adding a new subpart G consisting of
Secs. 24.403 through 24.444 to read as follows:
Subpart G--Interim Application, Licensing and Processing Rules for
Narrowband PCS
Sec.
24.403 Authorization required.
24.404 Eligibility.
24.405 Formal and informal applications.
24.406 Filing of Narrowband PCS applications, fees, and numbers of
copies.
24.407-24.408 [Reserved]
24.409 Standard Application forms and permissive changes or minor
modifications for the narrowband Personal Communications Service.
24.411 Miscellaneous forms.
24.412 [Reserved]
24.413 General application requirements.
24.414 [Reserved]
24.415 Technical content of applications; maintenance of list of
station locations.
24.416 Station Antenna Structures.
24.417-24.418 [Reserved]
24.419 Waiver of rules.
24.420 Defective applications.
24.421 Inconsistent or conflicting applications.
24.422 Amendment of application for Narrowband Personal
Communications Service filed on FCC Form 175.
24.423 Amendment of applications for Narrowband Personal
Communications Service (other than applications filed on FCC Form
175). This section applies to all applications for Narrowband
Personal Communications Service other than applications filed on FCC
Form 175.
24.424 [Reserved]
24.425 Application for temporary authorizations.
24.426 Receipt of application; applications in the narrowband
Personal Communications Services filed on FCC Form 175 and other
applications in the narrowband PCS Service.
24.427 Public notice period.
24.428 Dismissal and return of applications.
24.429 Ownership changes and agreements to amend to dismiss
applications or pleadings.
24.430 Opposition to applications.
24.431 Mutually exclusive applications.
24.432 Consideration of applications.
24.433-24.438 [Reserved]
24.439 Transfer of control or assignment of station authorization.
24.440-24.442 [Reserved]
24.443 Extension of time to complete construction.
24.444 Termination of authorization.
SUBPART G--INTERIM APPLICATION, LICENSING AND PROCESSING RULES FOR
NARROWBAND PCS
Sec. 24.403 Authorization required.
No person shall use or operate any device for the transmission of
energy or communications by radio in the services authorized by this
part except as provided in this part.
Sec. 24.404 Eligibility.
(a) General. Authorizations will be granted upon proper application
if:
(1) The applicant is qualified under the applicable laws and the
regulations, policies and decisions issued under the laws, including
Sec. 24.101 and 24.12;
(2) There are frequencies available to provide satisfactory
service; and
(3) The public interest, convenience or necessity would be served
by a grant.
(b) Alien ownership.
A narrowband PCS authorization to provide Commercial Mobile Radio
Service may not be granted to or held by:
(1) Any alien or the representative of any alien.
(2) Any corporation organized under the laws of any foreign
government.
(3) Any corporation of which any officer or director is an alien or
of which more than one-fifth of the capital stock is owned of record or
voted by aliens or their representatives or by a foreign government or
representative thereof or any corporation organized under the laws of a
foreign country.
(4) Any corporation directly or indirectly controlled by any other
corporation of which any officer or more than one-fourth of the
directors are aliens, or of which more than one-fourth of the capital
stock is owned of record or voted by aliens, their representatives, or
by a foreign government or representative thereof, or by any
corporation organized under the laws of a foreign country, if the
Commission finds that the public interest will be served by the refusal
or revocation of such license. A Narrowband PCS authorization to
provide Private Mobile Radio Service may not be granted to or held by a
foreign government or a representative thereof.
Sec. 24.405 Formal and informal applications.
(1) Except for an authorization under any of the conditions stated
in section 308(a) of the Communications Act of 1934 (47 U.S.C. 308(a)),
the Commission may grant only upon written application received by it,
the following authorization: Station licenses; modifications of
licenses; renewals of licenses; transfers and assignments of station
licenses, or any right thereunder.
(b) Except as may be otherwise permitted by this part, a separate
written application shall be filed for each instrument of authorization
requested. Applications may be:
(1) ``Formal applications'' where the Commission has prescribed in
this Part a standard form; or
(2) ``Informal applications'' (normally in letter form) where the
Commission has not prescribed a standard form.
(c) An informal application will be accepted for filing only if:
(1) A standard form is not prescribed or clearly applicable to the
authorization requested;
(2) It is a document submitted, in duplicate, with a caption which
indicates clearly the nature of the request, radio service involved,
location of the station, and the application file number (if known);
and
(3) It contains all the technical details and informational
showings required by the rules and states clearly and completely the
facts involved and authorization desired.
Sec. 24.406 Filing of Narrowband PCS applications, fees, and numbers
of copies.
(a) As prescribed by Secs. 24.305, 24.307, and 24.409 of this part,
standard formal application forms applicable to the narrowband PCS may
be obtained from either:
(1) Federal Communications Commission, Washington, DC 20554; or
(2) By calling the Commission's Forms Distribution Center, (202)
632-3676.
(b) Applications for the initial provision of narrowband PCS
service must be filed on FCC Form 175 in accordance with the rules in
Sec. 24.305 and 47 CFR part 1, subpart Q. In the event of mutual
exclusivity between applicants filing FCC Form 175, only auction
winners will be eligible to file subsequent long form applications on
FCC Form 401 for initial narrowband PCS licenses. Mutually exclusive
applications filed on Form 175 are subject to competitive bidding under
those rules. Narrowband PCS applicants filing Form 401 need not
complete Schedule B.
(c) All applications for Narrowband PCS radio station
authorizations (other than applications for initial provision of
narrowband PCS service filed on FCC Form 175) shall be submitted for
filing to: Federal Communications Commission, Washington, DC 20554,
Attention: Narrowband PCS Processing Section. Applications requiring
fees as set forth at part 1, subpart G of this chapter must be filed in
accordance with Sec. 0.401(b).
(d) All correspondence or amendments concerning a submitted
application shall clearly identify the name of the applicant, applicant
identification number or Commission file number (if known) or station
call sign of the application involved, and may be sent directly to the
Common Carrier Bureau, Narrowband PCS Processing Station.
(e) Except as otherwise specified, all applications, amendments,
correspondence, pleadings and forms (including FCC Form 175) shall be
submitted on one original paper copy and with three microfiche copies,
including exhibits and attachments thereto, and shall be signed as
prescribed by Sec. 1.743. Filings of five pages or less are exempt from
the requirement to submit on microfiche, as well as emergency filings
like letters requesting special temporary authority. Those filing any
amendments, correspondence, pleadings, and forms must simultaneously
submit the original hard copy which must be stamped ``original''. In
addition to the original hard copy, those filing pleadings, including
pleadings under 47 CFR 1.2108 shall also submit 2 paper copies as
provided in 47 CFR 1.51.
(1) Microfiche copies. Each microfiche copy must be a copy of the
signed original. Each microfiche copy shall be a 148 mm x 105 mm
negative (clear transparent characters appearing on an opaque
background) at 24X to 27X reduction for microfiche or microfiche
jackets. One of the microfiche sets must be a silver halide camera
master or a copy made on silver halide film such as Kodak Direct
Duplicatory Film. The microfiche must be placed in paper microfiche
envelopes and submitted in a B6 (125 mm x 176 mm) or 5 x 7.5 inch
envelope. All applicants must leave Row ``A'' (the first row for page
images) of the first fiche blank for in-house identification purposes.
(2) All applications and all amendments must have the following
information printed on the mailing envelope, the microfiche envelope,
and on the title area at the top of the microfiche:
(i) The name of the applicant;
(ii) The type of application (e.g., nationwide, regional, MTA, BTA,
response channel);
(iii) The month and year of the document;
(iv) Name of the document;
(v) File number, applicant identification number, and call sign, if
assigned; and
(vi) The identification number and date of the Public Notice
announcing the auction in response to which the application was filed
(if applicable).
Each microfiche copy of pleadings shall include:
(A) The month and year of the document;
(B) Name of the document;
(C) Name of the filing party;
(D) File number, applicant identification number, and call sign, if
assigned;
(E) The identification number and date of the Public Notice
announcing the auction in response to which the application was filed
(if applicable). Abbreviations may be used if they are easily
understood.
Secs. 24.407-24.408 [Reserved].
Sec. 24.409 Standard application forms and permissive changes or minor
modifications for the narrowband Personal Communications Service.
(a) Applications for the initial provision of narrowband PCS
service must be filed on FCC Forms 175 and 175-S.
(b) Subsequent application by auction winners or non-mutually
exclusive applicants for narrowband PCS radio station(s) under part 24.
FCC Form 401 (``Application for New or Modified Common Carrier Radio
Station Under part 22'') shall be submitted by each auction winner for
each narrowband PCS license applied for on FCC Form 175. In the event
that mutual exclusivity does not exist between applicants filing FCC
Form 175, the Commission will so inform the applicant and the applicant
will also file FCC Form 401. Blanket licenses are granted for each
market frequency block. Applications for individual sites are not
needed and will not be accepted. See Sec. 24.11. Narrowband PCS
applicants filing Form 401 need not complete Schedule B.
(c) Extensions of time and reinstatement. When a licensee cannot
complete construction in accordance with the provisions of Sec. 24.103,
a timely application for extension of time (FCC Form 489) must be
filed.
(d) License for mobile subscriber station--These stations are
considered to be associated with and covered by the authorization
issued to the carrier serving the land mobile station. No additional
authorization is required.
Sec. 24.410 [Reserved].
Sec. 24.411 Miscellaneous forms.
(a) Licensee qualifications. FCC Form 430 (``Common Carrier and
Satellite Radio Licensee Qualifications Report'') shall be filed by
Narrowband Personal Communications Service licensees only as required
by Form 490 (Application for Assignment or Transfer of Control Under
part 22).
(b) Renewal of station license. Except for renewal of special
temporary authorizations, FCC Form 405 (``Application for Renewal of
Station License'') must be filed in duplicate by the licensee between
thirty (30) and sixty (60) days prior to the expiration date of the
license sought to be renewed.
Sec. 24.412 [Reserved].
Sec. 24.413 General application requirements.
(a) Each application (including applications filed on Forms 175 and
401) for a radio station authorization or for consent to assignment or
transfer of control in the narrowband PCS shall disclose fully the real
party or parties in interest and must include the following
information:
(1) A list of its subsidiaries, if any. Subsidiary means any
business five per cent or more whose stock, warrants, options or debt
securities are owned by the applicant or an officer, director,
stockholder or key management personnel of the applicant. This list
must include a description of each subsidiary's principal business and
a description of each subsidiary's relationship to the applicant.
(2) A list of its affiliates, if any. Affiliates means any business
which holds a five per cent or more interest in the applicant, or any
business in which a five per cent or more interest is held by another
company which holds a five per cent interest in the applicant (e.g.
Company A owns 5% of Company B and 5% of Company C; Companies B and C
are affiliates).
(3) A list of the names, addresses, citizenship and principal
business of any person holding five per cent or more of each class of
stock, warrants, options or debt securities together with the amount
and percentage held, and the name, address, citizenship and principal
place of business of any person on whose account, if other than the
holder, such interest is held. If any of these persons are related by
blood or marriage, include such relationship in the statement.
(4) In the case of partnerships, the name and address of each
partner, each partner's citizenship and the share or interest
participation in the partnership. This information must be provided for
all partners, regardless of their respective ownership interests in the
partnership. A signed and dated copy of the partnership agreement must
be included in the application. This information must be included in
Exhibit V of the application.
(b) Each application for a radio station authorization in the
narrowband PCS must:
(1) Submit the information required by the Commission's rules,
requests, and application forms;
(2) Be maintained by the applicant substantially accurate and
complete in all significant respects in accordance with the provisions
of Sec. 1.65 of this chapter; and
(3) Show compliance with and make all special showings that may be
applicable.
(c) Where documents, exhibits, or other lengthy showings already on
file with the Commission contain information which is required by an
application form, the application may specifically refer to such
information, if:
(1) The information previously filed is over one A4 (21 cm x 29.7
cm) or 8.5 x 11 inch (21.6 cm x 27.9 cm) page in length, and all
information referenced therein is current and accurate in all
significant respects under Sec. 1.65 of this chapter; and
(2) The reference states specifically where the previously filed
information can actually be found, including mention of:
(i) the station call sign or application file number whenever the
reference is to station files or previously filed applications;
(ii) The title of the proceeding, the docket number, and any legal
citations, whenever the reference is to a docketed proceeding. However,
questions on an application form which call for specific technical
data, or which can be answered by a ``yes'' or ``no'' or other short
answer shall be answered as appropriate and shall not be cross-
referenced to a previous filing.
(d) In addition to the general application requirements of subpart
F and Secs. 1.2105, 24.413 and 24.415 of this part, applicants shall
submit any additional documents, exhibits, or signed written statements
of fact:
(1) As may be required by these rules; and
(2) As the Commission, at any time after the filing of an
application and during the term of any authorization, may require from
any applicant, permittee, or licensee to enable it to determine whether
a radio authorization should be granted, denied, or revoked.
(e) Except when the Commission has declared explicitly to the
contrary, an informational requirement does not in itself imply the
processing treatment of decisional weight to be accorded the response.
(f) All applicants (except applicants filing FCC Form 175) are
required to indicate at the time their application is filed whether or
not a Commission grant of the application may have a significant
environmental impact as defined by 47 CFR 1.1307. If answered
affirmatively, the requisite environmental assessment as prescribed in
Sec. 1.1311 of this chapter must be filed with the application and
Commission environmental review must be completed prior to
construction. See Sec. 1.1312 of this chapter. All narrowband PCS
licensees are subject to a continuing obligation to determine whether
subsequent construction may have a significant environmental impact
prior to undertaking such construction and to otherwise comply with
Secs. 1.1301 through 1.1319 of this chapter. See 47 CFR 1.1312.
Sec. 24.414 [Reserved].
Sec. 24.415 Technical content of applications; maintenance of list of
station locations.
(a) All applications required by this part shall contain all
technical information required by the application forms or associated
public notice(s). Applications other than initial applications for a
narrowband PCS license must also comply with all technical requirements
of the rules governing the narrowband PCS (see subparts C and D as
appropriate). The following paragraphs describe a number of general
technical requirements.
(b) Each application (except applications for initial licenses
filed on Form 175) for a radio station authorization for narrowband PCS
must comply with the provisions of Secs. 24.129 through 24.135.
(c)--(i) [Reserved]
(i) The location of the transmitting antenna shall be considered to
be the station location. Narrowband PCS licensees must maintain a
current list of all station locations, which must describe the
transmitting antenna site by its geographical coordinates and also by
conventional reference to street number, landmark, or the equivalent.
All such coordinates shall be specified in terms of degrees, minutes,
and seconds to the nearest second of latitude and longitude.
Sec. 24.416 Station antenna structures.
(a) Unless the narrowband PCS licensee has received prior approval
from the FCC, no antenna structure, including radiating elements,
tower, supports and all appurtenances, may be higher than 61 m (200
feet) above ground level at its site.
(b) Unless the narrowband PCS licensee has received prior approval
from the FCC, no antenna structure at an airport or heliport that is
available for public use and is listed in the Airport Directory of the
current Airman's Information Manual or in either the Alaska or Pacific
Airman's Guide and Chart Supplement; or at an airport or heliport under
construction that is the subject of a notice or proposal on file with
the FAA, and except for military airports, it is clearly indicated that
the airport will be available for public use; or at an airport or
heliport that is operated by the armed forces of the United States; or
a place near any of these airports or heliports, may be higher than:
(1) 1 m above the airport elevation for each 100 m from the airport
runway longer than 1 km within 6.1 km of the antenna structure.
(2) 2 m above the airport elevation for each 100 m from the nearest
runway shorter than 1 km within 3.1 km of the antenna structure.
(3) 4 m above the airport elevation for each 100 m from the nearest
landing pad within 1.5 km of the antenna structure.
(c) A narrowband PCS station antenna structure no higher than 6.1 m
(10 feet) above ground level at its site or no higher than 6.1 m above
any natural object or existing manmade structure, other than an antenna
structure, is exempt from the requirements of paragraphs (a) and (b) of
this section.
(d) Further details as to whether an aeronautical study and/or
obstruction marking and lighting may be required, and specifications
for obstruction marking and lighting are contained in part 17 of the
FCC Rules, Construction, Marking and Lighting of Antenna Structures. To
request approval to place an antenna structure higher than the limits
specified in paragraphs (a), (b), and (c) of this section, the licensee
must notify the Federal Aviation Administration (FAA) on FAA Form 7460-
1 and the FCC on FCC Form 854.
Secs. 24.417-24.418 [Reserved]
Sec. 24.419 Waiver of rules.
(a) Request for waivers. (1) Waivers of these rules may be granted
upon application or by the Commission on its own motion. Requests for
waivers shall contain a statement of reasons sufficient to justify a
waiver. Waivers will not be granted except upon an affirmative showing:
(i) That the underlying purpose of the rule will not be served, or
would be frustrated, by the application in a particular case, and that
grant of the waiver is otherwise in the public interest; or
(ii) That the unique facts and circumstances of a particular case
render application of the rule inequitable, unduly burdensome or
otherwise contrary to the public interest. Applicants must also show
the lack of a reasonable alternative.
(2) If the information necessary to support a waiver request is
already on file, the applicant may cross-reference to the specific
filing where it may be found.
(b) Denial of waiver, alternate showing required. If a waiver is
not granted, the application will be dismissed as defective unless the
applicant has also provided an alternative proposal which complies with
the Commission's rules (including any required showings).
Sec. 24.420 Defective applications.
(a) Unless the Commission shall otherwise permit, an application
will be unacceptable for filing and will be returned to the applicant
with a brief statement as to the omissions or discrepancies if:
(1) The application is defective with respect to completeness of
answers to questions, informational showings, execution, or other
matters of a formal character; or
(2) The application does not comply with the Commission's rules,
regulations, specific requirements for additional information or other
requirements. See also 47 CFR 1.2105.
(b) Some examples of common deficiencies which result in defective
applications under paragraph (a) of this section are:
(1) The application is not filled out completely and signed;
(2)-(4) [Reserved]
(5) The application (other than an application filed on FCC Form
175) does not include an environmental assessment as required for an
action that may have a significant impact upon the environment, as
defined in Sec. 1.1307 of this chapter.
(6) [Reserved]
(7) The application is filed prior to the Public Notice issued
under Sec. 24.305 announcing the application filing date for the
relevant auction or after the cutoff date prescribed in that public
notice;
(c) [Reserved]
(d) If an applicant is requested by the Commission to file any
documents or any supplementary or explanatory information not
specifically required in the prescribed application form, a failure to
comply with such request within a specified time period will be deemed
to render the application defective and will subject it to dismissal.
Sec. 24.421 Inconsistent or conflicting applications.
While an application is pending and undecided, no subsequent
inconsistent or conflicting application may be filed by the same
applicant, his successor or assignee, or on behalf or for the benefit
of the same applicant, his successor or assignee.
Sec. 24.422 Amendment of application for Narrowband Personal
Communications Service filed on FCC Form 175.
(a) The Commission will provide bidders a limited opportunity to
cure defects in FCC Form 175 specified herein except for failure to
sign the application and to make certifications, defects which may not
be cured. See also 47 CFR 1.2105.
(b) In the Narrowband PCS, the only amendments to FCC Form 175
which will be permitted are minor amendments to correct minor errors or
defects such as typographical errors. All other amendments to FCC Form
175, such as ownership changes or changes in the identification of
parties to bidding consortia, will be considered to be major
amendments. An FCC Form 175 which is amended by a major amendment will
be considered to be newly filed and cannot be resubmitted after
applicable filing deadlines. See also Sec. 1.2105.
Sec. 24.423 Amendment of applications for Narrowband Personal
Communications Service (other than applications filed on FCC Form 175).
This section applies to all applications for Narrowband Personal
Communications Service other than applications filed on FCC Form 175.
(a) Amendments as of right. A pending application may be amended as
a matter of right if the application has not been designated for
hearing.
(1) Amendments shall comply with Sec. 24.429, as applicable; and
(2) Amendments which resolve interference conflicts or amendments
under Sec. 24.429 may be filed at any time.
(b) The Commission or the presiding officer may grant requests to
amend an application designated for hearing only if a written petition
demonstrating good cause is submitted and properly served upon the
parties of record.
(c) Major amendments, minor amendments. The Commission will
classify all amendments as minor except in the cases listed below. An
amendment shall be deemed to be a major amendment subject to
Sec. 24.427 under any of the following circumstances:
(1) Change in technical proposal. If the amendment results in a
substantial change in the engineering proposal such as (but not
necessarily limited to) a change in, or an addition of, a radio
frequency; or
(2) Amendment to proposed service area. If the amendment extends
the reliable service area of the proposed facilities outside its MTA,
BTA, or other applicable market area as defined in Sec. 24.102; or
(3) A substantial change in ownership or control.
(d) If a petition to deny (or other formal objection) has been
filed, any amendment, requests for waiver, (or other written
communications) shall be served on the petitioner, unless waiver of
this requirement is granted pursuant to paragraph (e) of this section.
See also 47 CFR 1.2108.
(e) The Commission may waive the service requirements of paragraph
(d) of this section and prescribe such alternative procedures as may be
appropriate under the circumstances to protect petitioners' interests
and to avoid undue delay in a proceeding, if an applicant submits a
request for waiver which demonstrates that the service requirement is
unreasonably burdensome.
(f) Any amendment to an application shall be signed and shall be
submitted in the same manner, and with the same number of copies, as
was the original application. Amendments may be made in letter form if
they comply in all other respects with the requirements of this
chapter.
(g) An application will be considered to be a newly filed
application if it is amended by a major amendment (as defined in this
section), except in the following circumstances:
(1)-(2) [Reserved]
(3) The amendment reflects only a change in ownership or control
found by the Commission to be in the public interest;
(4) [Reserved]
(5) The amendment corrects typographical transcription, or similar
clerical errors which are clearly demonstrated to be mistakes by
reference to other parts of the application, and whose discovery does
not create new or increased frequency conflicts;
(6) The amendment does not create new or increased frequency
conflicts, and is demonstrably necessitated by events which the
applicant could not have reasonably foreseen at the time of filing,
such as, for example:
(i) The loss of a transmitter or receiver site by condemnation,
natural causes, or loss of lease or option; or
(ii) Obstruction of a proposed transmission path caused by the
erection of a new building or other structure.
Sec. 24.424 [Reserved].
Sec. 24.425 Application for temporary authorizations.
(a) In circumstances requiring immediate or temporary use of
facilities, request may be made for special temporary authority to
install and/or operate new or modified equipment. Any such request may
be submitted as an informal application in the manner set forth in
Sec. 24.5 and must contain full particulars as to the proposed
operation including all facts sufficient to justify the temporary
authority sought and the public interest therein. No such request will
be considered unless the request is received by the Commission at least
10 days prior to the date of proposed construction or operation or,
where an extension is sought, expiration date of the existing temporary
authorization. A request received within less than 10 days may be
accepted upon due showing of sufficient reasons for the delay in
submitting such request.
(b) Special temporary authorizations may be granted without regard
to the 30-day public notice requirements of Sec. 24.27(b) when:
(1) The authorization is for a period not to exceed 30 days and no
application for regular application is contemplated to be filed;
(2) The authorization is for a period not to exceed 60 days pending
the filing of an application for such regular operation;
(3) The authorization is to permit interim operation to facilitate
completion of authorized construction or to provide substantially the
same service as previously authorized; or
(4) The authorization is made upon a finding that there are
extraordinary circumstances requiring operation in the public interest
and that delay in the institution of such service would seriously
prejudice the public interest.
(c) Temporary authorizations of operation not to exceed 180 days
may be granted under the standards of section 309(f) of the
Communications Act where extraordinary circumstances so require.
Extensions of the temporary authorization for a period of 180 days each
may also be granted, but the renewal applicant bears a heavy burden to
show that extraordinary circumstances warrant such an extension.
(d) In cases of emergency found by the Commission, involving danger
to life or property or due to damage of equipment, or during a national
emergency proclaimed by the President or declared by the Congress or
during the continuance of any war in which the United States is engaged
and when such action is necessary for the national defense or safety or
otherwise in furtherance of the war effort, or in cases of emergency
where the Commission finds that it would not be feasible to secure
renewal applications from existing licensees or otherwise to follow
normal licensing procedure, the Commission will grant radio station
authorizations and station licenses, or modifications or renewals
thereof, during the emergency found by the Commission or during the
continuance of any such national emergency or war, as special temporary
licenses, only for the period of emergency or war requiring such
action, without the filing of formal applications.
Sec. 24.426 Receipt of application; applications in the narrowband
Personal Communications Services filed on FCC Form 175 and other
applications in the narrowband PCS Service.
(a) All applications for the initial provision of narrowband PCS
service must be submitted on FCC Forms 175 and 175-S. Mutually
exclusive initial applications in the narrowband Personal
Communications Services are subject to competitive bidding. FCC Form
401 (``Application for New or Modified Common Carrier Radio Station
Under Part 22'') must be submitted by each winning bidder for each
narrowband PCS license applied for on FCC Form 175. In the event that
mutual exclusivity does not exist between applicants filing FCC Form
175, the applicant will also file FCC Form 401. The aforementioned
Forms 175, 175-S, and 401 are subject to the provisions of 47 CFR part
1, subpart Q (``Competitive Bidding Proceedings'') and subpart F of
this part. Blanket licenses are granted for each market frequency
block. Applications for individual sites are not needed and will not be
accepted. See Sec. 24.11.
(b) Applications received for filing are given a file number. The
assignment of a file number to an application is merely for
administrative convenience and does not indicate the acceptance of the
application for filing and processing. Such assignment of a file number
will not preclude the subsequent return or dismissal of the application
if it is found to be not in accordance with the Commission's rules.
(c) Acceptance of an application for filing merely means that it
has been the subject of a preliminary review as to completeness. Such
acceptance will not preclude the subsequent return or dismissal of the
application if it is found to be defective or not in accordance with
the Commission's rules. (See Sec. 24.413 for additional information
concerning filing of applications.)
Sec. 24.427 Public notice period.
(a) At regular intervals, the Commission will issue a public notice
listing:
(1) The acceptance for filing of all applications and major
amendments thereto;
(2) Significant Commission actions concerning applications listed
as acceptable for filing;
(3) Information which the Commission in its discretion believes of
public significance. Such notices are solely for the purpose of
informing the public and do not create any rights in an applicant or
any other person;
(4) Special environmental considerations as required by part 1 of
this chapter.
(b)(1) The Commission will not grant any application until
expiration of a period of thirty (30) days following the issuance date
of a public notice listing the application, or any major amendments
thereto, as acceptable for filing. Provided, that the Commission will
not grant an application filed on Form 401 filed either by a winning
bidder or by an applicant whose Form 175 application is not mutually
exclusive with other applicants, until the expiration of a period of
forty (40) days following the issuance of a public notice listing the
application, or any major amendments thereto, as acceptable for filing.
See also 47 CFR 1.2108.
(c) As an exception to paragraphs (a)(1), (a)(2) and (b) of this
section, the public notice provisions are not applicable to
applications:
(1) For authorization of a minor technical change in the facilities
of an authorized station where such a change would not be classified as
a major amendment (as defined by Sec. 24.423) were such a change to be
submitted as an amendment to a pending application;
(2) For issuance of a license subsequent to a radio station
authorization or, pending application for a grant of such license, any
special or temporary authorization to permit interim operation to
facilitate completion of authorized construction or to provide
substantially the same service as would be authorized by such license;
(3) For extension of time to complete construction of authorized
facilities, see Sec. 24.103;
(4) For temporary authorization pursuant to Sec. 24.425(b);
(5) [Reserved]
(6) For an authorization under any of the proviso clauses of
section 308(a) of the Communications Act of 1934 (47 U.S.C. 308(a));
(7) For consent to an involuntary assignment or transfer of control
of a radio authorization; or
(8) For consent to a voluntary assignment or transfer of control of
a radio authorization, where the assignment or transfer does not
involve a substantial change in ownership or control.
Sec. 24.428 Dismissal and return of applications.
(a) Except as provided under Sec. 24.429, any application may be
dismissed without prejudice as a matter of right if the applicant
requests its dismissal prior to designation for hearing or, in the case
of applications filed on Forms 175 and 175-S, prior to auction. An
applicant's request for the return of his application after it has been
accepted for filing will be considered to be a request for dismissal
without prejudice. Applicants requesting dismissal of their
applications are also subject to 47 CFR 1.2104. Requests for dismissal
shall comply with the provisions of Sec. 24.429 as appropriate.
(b) A request to dismiss an application without prejudice will be
considered after designation for hearing only if:
(1) A written petition is submitted to the Commission and is
properly served upon all parties of record, and
(2) The petition complies with the provisions of Sec. 24.429
(whenever applicable) and demonstrates good cause.
(c) The Commission will dismiss an application for failure to
prosecute or for failure to respond substantially within a specified
time period to official correspondence or requests for additional
information. Dismissal shall be without prejudice if made prior to
designation for hearing or prior to auction, but dismissal may be made
with prejudice for unsatisfactory compliance with Sec. 24.429 or after
designation for hearing or after the applicant is notified that it is
the winning bidder under the auction process.
Sec. 24.429 Ownership changes and agreements to amend or to dismiss
applications or pleadings.
(a) Applicability. Subject to the provisions of 47 CFR 1.2105
(Bidding Application and Certification Procedures; Prohibition of
Collusion), this section applies to applicants and all other parties
interested in pending applications who wish to resolve contested
matters among themselves with a formal or an informal agreement or
understanding. This section applies only when the agreement or
understanding will result in:
(1) A major change in the ownership of an applicant to which
Secs. 24.423 and 24.423(g) apply or which would cause the applicant to
lose its status as a designated entity under Sec. 24.309, or
(2) The individual or mutual withdrawal, amendment or dismissal of
any pending application, amendment, petitioner or other pleading.
(b) Policy. Parties to contested proceedings are encouraged to
settle their disputes among themselves. Parties which, under a
settlement agreement, apply to the Commission for ownership changes or
for the amendment or dismissal of either pleadings or applications,
shall at the time of filing notify the Commission that such filing is
the result of an agreement or understanding.
(c) If the amendment would, if granted, cause the applicant to lose
its status as a designated entity under Sec. 24.309, the applicant must
comply with the obligations imposed by Sec. 24.309 (Designated
Entities) and Sec. 1.2111 (Assignment of transfer of control; unjust
enrichment) before the amendment will be granted.
(d) The provisions of 47 CFR 22.927 will apply in the event of the
individual or mutual withdrawal, amendment or dismissal of any pending
application, amendment, petitioner or other pleading.
Sec. 24.430 Opposition to applications.
(a) Petitions to deny (including petitions for other forms of
relief) and responsive pleadings for Commission consideration must
comply with Section 1.2108 and must:
(1) Identify the application or applications (including applicant's
name, station location, Commission file numbers and radio service
involved) with which it is concerned;
(2) Be filed in accordance with the pleading limitations, filing
periods, and other applicable provisions of 47 CFR 1.41 through 1.52
except where otherwise provided in 47 CFR 1.2108;
(3) Contain specific allegations of fact which, except for facts of
which official notice may be taken, shall be supported by affidavit of
a person or persons with personal knowledge thereof, and which shall be
sufficient to demonstrate that the petitioner (or respondent) is a
party in interest and that a grant of, or other Commission action
regarding, the application would be prima facie inconsistent with the
public interest;
(4) Be filed within thirty (30) days after the date of public
notice announcing the acceptance for filing of any such application or
major amendment thereto (unless the Commission otherwise extends the
filing deadline); and
(5) Contain a certificate of service showing that it has been
mailed to the applicant no later than the date of filing thereof with
the Commission.
(b) A petition to deny a major amendment to a previously filed
application may only raise matters directly related to the amendment
which could not have been raised in connection with the underlying,
previously filed application. This does not apply to petitioners who
gain standing because of the major amendment.
Sec. 24.431 Mutually exclusive applications.
(a) The Commission will consider applications to be mutually
exclusive if their conflicts are such that the grant of one application
would effectively preclude by reason of harmful electrical
interference, or other practical reason, the grant of one or more of
the other applications. The Commission will presume ``harmful
electrical interference'' to mean interference which would result in a
material impairment to service rendered to the public despite full
cooperation in good faith by all applicants or parties to achieve
reasonable technical adjustments which would avoid electrical conflict.
(b) Mutually exclusive applications filed on Form 175 for the
initial provision of narrowband PCS service are subject to competitive
bidding in accordance with the procedures in subpart F of this part and
in 47 CFR part 1, subpart Q.
(c) An application will be entitled to comparative consideration
with one or more conflicting applications only if the Commission
determines that such comparative consideration will serve the public
interest.
Sec. 24.432 Consideration of applications.
(a) Applications for an instrument of authorization will be granted
if, upon examination of the application and upon consideration of such
other matters as it may officially notice, the Commission finds that
the grant will serve the public interest, convenience, and necessity.
See also Sec. 1.2108.
(b) The grant shall be without a formal hearing if, upon
consideration of the application, any pleadings or objections filed, or
other matters which may be officially noticed, the Commission finds
that:
(1) The application is acceptable for filing, and is in accordance
with the Commission's rules, regulations, and other requirements;
(2) The application is not subject to a post-auction hearing or to
comparative consideration pursuant to Sec. 24.431 with another
application(s);
(3) A grant of the application would not cause harmful electrical
interference to an authorized station;
(4) There are no substantial and material questions of fact
presented; and
(5) The applicant is qualified under current FCC regulations and
policies.
(c) If the Commission should grant without a formal hearing an
application for an instrument of authorization which is subject to a
petition to deny filed in accordance with Sec. 24.430, the Commission
will deny the petition by the issuance of a Memorandum Opinion and
Order which will concisely report the reasons for the denial and
dispose of all substantial issues raised by the petition.
(d) Whenever the Commission, without a formal hearing, grants any
application in part, or subject to any terms or conditions other than
those normally applied to applications of the same type, it shall
inform the applicant of the reasons therefor, and the grant shall be
considered final unless the Commission should revise its action (either
by granting the application as originally requested, or by designating
the application for a formal evidentiary hearing) in response to a
petition for reconsideration which:
(1) Is filed by the applicant within thirty (30) days from the date
of the letter or order giving the reasons for the partial or
conditioned grant;
(2) Rejects the grant as made and explains the reasons why the
application should be granted as originally requested; and,
(3) Returns the instrument of authorization.
(e) The Commission will designate an application for a formal
hearing, specifying with particularity the matters and things in issue,
if, upon consideration of the application, any pleadings or objections
filed, or other matters which may be officially noticed, the Commission
determines that:
(1) A substantial and material question of fact is presented (see
also Sec. 1.2108);
(2) The Commission is unable for any reason to make the findings
specified in paragraph (a) of this section and the application is
acceptable for filing, complete, and in accordance with the
Commission's rules, regulations, and other requirements; or
(3) The application is entitled to comparative consideration (under
Sec. 24.431) with another application (or applications).
(f) The Commission may grant, deny or take other action with
respect to an application designated for a formal hearing pursuant to
paragraph (e) of this section or part 1 of this chapter.
(g) [Reserved]
(h) Reconsideration or review of any final action taken by the
Commission will be in accordance with Subpart A of part 1 of this
chapter.
Sec. 24.433-24.438 [Reserved].
Sec. 24.439 Transfer of control or assignment of station
authorization.
(a) Approval required. Authorizations shall be transferred or
assigned to another party, voluntarily (for example, by contract) or
involuntarily (for example, by death, bankruptcy, or legal disability),
directly or indirectly or by transfer of control of any corporation
holding such authorization, only upon application and approval by the
Commission. A transfer of control or assignment of station
authorization in the narrowband Personal Communications Service is also
subject to Sec. 24.309 (Designated Entities) and Sec. 1.2111
(Assignment or transfer of control: unjust enrichment).
(1) A change from less than 50% ownership to 50% or more ownership
shall always be considered a transfer of control.
(2) In other situations a controlling interest shall be determined
on a case-by-case basis considering the distribution of ownership, and
the relationships of the owners, including family relationships.
(b) Form required--(1) Assignment.
(i) FCC Form 490 shall be filed to assign a license or permit.
(ii) In the case of involuntary assignment, FCC Form 490 shall be
filed within 30 days of the event causing the assignment.
(2) Transfer of control. (i) FCC Form 490 shall be submitted in
order to transfer control of a corporation holding a license or permit.
(ii) In the case of involuntary transfer of control, FCC Form 490
shall be filed within 30 days of the event causing the transfer.
(3) Form 430. Whenever an application must be filed under paragraph
(a) (1) or (2) of this section, the assignee or transferee shall file
FCC Form 430 (``Common Carrier Radio License Qualification Report'')
unless an accurate report is on file with the Commission.
(4) Notification of completion. The Commission shall be notified by
letter of the date of completion of the assignment or transfer of
control.
(5) If the transfer of control of a license is approved, the new
licensee is held to the original build-out requirement of Sec. 24.103.
(c) In acting upon applications for transfer of control or
assignment, the Commission will not consider whether the public
interest, convenience, and necessity might be served by the transfer or
assignment of the authorization to a person other than the proposed
transferee or assignee.
(d) [Reserved]
Sec. 24.440-24.442 [Reserved].
Sec. 24.443 Extension of time to complete construction.
(a) If construction is not completed within the time period set
forth in Sec. 24.103, the authorization will automatically expire.
Before the period for construction expires an application for an
extension of time to complete construction (FCC Form 489) may be filed.
See paragraph (b) of this section. Within 30 days after the
authorization expires an application for reinstatement may be filed on
FCC Form 489.
(b) An application for extension of time to complete construction
may be made on FCC Form 489. Extension of time requests must be filed
prior to the expiration of the construction period. Extensions will be
granted only if the licensee shows that the failure to complete
construction is due to causes beyond his control. An application for
modification of an authorization (under construction) does not extend
the initial construction period. If additional time to construct is
required, an FCC Form 489 must be submitted.
Sec. 24.444 Termination of authorization.
(a) (1) All authorizations shall terminate on the date specified on
the authorization or on the date specified by these rules, unless a
timely application for renewal has been filed.
(2) If no application for renewal has been made before the
authorization's expiration date, a late application for renewal will
only be considered if it is filed within 30 days of the expiration date
and shows that the failure to file a timely application was due to
causes beyond the applicant's control. During this 30 day period
reinstatement applications must be filed on FCC Form 489. Service to
subscribers need not be suspended while a late filed renewal
application is pending, but such service shall be without prejudice to
Commission action on the renewal application and any related sanctions.
See also Sec. 24.16 (Criteria for Comparative Renewal Proceedings).
(b) Special Temporary Authority. A special temporary authorization
shall automatically terminate upon failure to comply with the
conditions in the authorization.
[FR Doc. 94-12165 Filed 5-23-94; 8:45 am]
BILLING CODE 6712-01-M
