[Federal Register Volume 62, Number 53 (Wednesday, March 19, 1997)]
[Notices]
[Pages 13009-13019]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-6832]


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FEDERAL COMMUNICATIONS COMMISSION
[DA 97-477; Report No. AUC 97-01]


Auction of Satellite Digital Audio Radio Service; Auction Notice 
and Filing Requirements For 2 DARS Licenses Scheduled for April 1, 1997

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: The Wireless Telecommunications Bureau announced the 
application procedures for the upcoming DARS auction (Auction #15) in a 
Public Notice dated March 6, 1997. The auction is scheduled to begin on 
April 1, 1997 and will consist of two nationwide licenses. The purpose 
and intent of the notice is to inform the general public and the four 
DARS applicants of the auction procedures the Commission will utilize 
in Auction #15 and the filing requirements to become an eligible 
bidder.

FOR FURTHER INFORMATION CONTACT: Amy Zoslov, Christina Clearwater, or 
Ruby Hough, Wireless Telecommunications Bureau, at (202) 418-0660, or 
Rosalee Chiara, at (202) 418-0754, or Ron Repasi, at (202) 418-0768, of 
the International Bureau.

SUPPLEMENTARY INFORMATION:

    1. Auction Date: 9 a.m., Eastern Time, April 1, 1997. The precise 
schedule for bidding will be announced by Public Notice prior to the 
start of the auction.
    2. Auction Methodology: Simultaneous multiple round auction. 
Bidding will be permitted only at the FCC Auction site, 2 Massachusetts 
Avenue, NE., Washington, DC. (adjacent to Union Station; entrance on 
North Capitol Street). Telephonic bids and electronic bids from remote 
locations will not be accepted.
    3. Licenses to be Auctioned: Two nationwide licenses will be 
auctioned in the satellite Digital Audio Radio Service (``DARS''). 
Licenses will authorize service on 12.5 MHz of spectrum over the 
continental United States located in the S-band of 2320-2354 MHz.

------------------------------------------------------------------------
             License No.                      Spectrum  authorized      
------------------------------------------------------------------------
EBN001...............................  2320-2332.5 MHz                  
EBN002...............................  2332.5-2345 MHz                  
------------------------------------------------------------------------

    In addition to the Supplemental Information described below, 
applicants must indicate to the FCC the license(s) on which they intend 
to bid.
    4. Closed Auction: Participation in this auction will be limited to 
the following four entities: American Mobile Radio Corporation, Digital 
Satellite Broadcasting Corporation, Primosphere Limited Partnership, 
and Satellite CD Radio, Inc.
    5. Pre-Auction Deadlines:

*Supplemental Information
    5:30 p.m., ET, on the fifth day from publication of the DARS rules 
in the Federal Register. This day will be specified in a subsequent 
Public Notice.
*Upfront Payment of $3 million (by Wire Transfer)
    3 p.m., ET, Fri., March 28, 1997
*Auction Registration
    2 p.m.-3 p.m., ET, March 31, 1997
*Mock Auction
    3 p.m.-5 p.m., ET, March 31, 1997

    6. Prohibition of Collusion: To ensure the competitiveness of the 
auction process, the FCC's rules prohibit all applicants from 
communicating with each other during the auction about bids, bidding 
strategies, or settlements. This prohibition begins with the filing 
deadline of the Supplemental Information and ends when bidders submit 
down payments.
    7. Telephone Contacts:
 FCC Technical Support Hotline: (202) 414-1250
 Wireless Bureau--Auctions Division

--Amy Zoslov: (202) 418-0660
--Ruby Hough: (202) 418-0660
--Christina Clearwater: (202) 418-0660

 International Bureau

--Rosalee Chiara: (202) 418-0754
--Ron Repasi: (202) 418-0768

    8. List of Attachments:

 Attachment A:
    Federal Communications Commission DARS Licenses Auction; Auction 
Specific Instructions, FCC Remittance Advice, FCC Form 159
 Attachment B:
    FCC Remittance Advice (FCC Form 159) and Instructions for Using FCC 
Form 159 (Remittance Advice)

I. Introduction

    9. Those wishing to participate in the DARS auction must submit 
certain supplemental information (''Supplemental Information'') in 
accordance with the Commission's rules and the instructions in this 
Public Notice. The FCC will not issue a Bidder Information Package for 
this auction. All information necessary to participate in this auction 
will be available through this Public Notice, subsequent Public 
Notices, or the Commission's Rules. See 47 CFR Sec. 1.2101-1.2103, 
1.2104(a) through (f), (h) and (i), and 25.401-25.406; Establishment of 
Rules and Policies for the Digital Audio Radio Satellite Service in the 
2310-2360 MHz Frequency Band, Report and Order, Memorandum Opinion and 
Order, and Further Notice of Proposed Rulemaking, FCC 97-70 (released 
March 3, 1997) (''DARS Report and Order'').
    10. The Supplemental Information must be received no later than 
5:30 p.m. Eastern Time on the fifth day from the publication of the 
DARS rules in the Federal Register. This date will be specified in a 
subsequent Public Notice. Applicants for the DARS auction must file 
their Supplemental Information manually pursuant to the instructions 
set forth in this Public Notice.
    11. Applicants will be required to submit an upfront payment (in 
U.S. dollars) to be eligible to participate in the auction. The upfront 
payment shall be made by wire transfer and must be received by 3 p.m. 
Eastern Time on March 28, 1997, at the Mellon Bank in Pittsburgh, 
Pennsylvania.
    12. Prospective bidders must familiarize themselves thoroughly with 
the procedures, terms and conditions contained in this Public Notice. 
The rules contained in the DARS Report and Order in IB Docket No. 95-91 
and GEN Docket No. 90-357, FCC 97-70 (released March 3, 1997), this 
Public Notice, and subsequent Public Notices are not negotiable. 
Prospective bidders should review these auction documents thoroughly 
prior to the auction to make certain that they understand all of the 
provisions and are willing to be bound by all of the terms before 
participating in the auction.
    13. The information contained in this Public Notice may be 
subsequently amended or supplemented by the FCC or the Wireless 
Telecommunications Bureau at any time. The Wireless Telecommunications 
Bureau will issue Public Notices to convey new or supplemental 
information to prospective bidders. It is the responsibility of all 
prospective bidders to remain fully informed regarding all FCC rules 
and Public Notices pertaining to this auction. FCC Public Notices and 
other FCC documents may be obtained for a fee by calling the FCC 
duplication contractor, International Transcription Services, Inc., at 
(202) 857-3800. Additionally, prospective bidders may retrieve some of 
these documents from the FCC Internet site using ftp to connect as 
[email protected], or via the world wide web at www.fcc.gov.

[[Page 13010]]

II. Bidder Eligibility and Pre-Auction Procedures

    14. In order to be eligible to bid in the DARS auction, bidders 
must: (1) Satisfy the Commission's eligibility requirements, (2) submit 
the Supplemental Information, and (3) remit an upfront payment in 
compliance with applicable FCC rules and regulations.

A. Eligibility Requirements

    15. Eligibility to participate in this auction is reserved for 
those four parties who filed DARS applications by the December 15, 1992 
cut-off date. They are as follows:

1. American Mobile Radio Corporation
2. Digital Satellite Broadcasting Corporation
3. Primosphere Limited Partnership
4. Satellite CD Radio, Inc.

    16. Bidders may win only one license, and as such will be permitted 
to be active on only one license at a time. However, bidders will be 
permitted to bid on either license during the course of the auction 
provided they indicate this intention in their Supplemental Information 
(see below).

B. Supplemental Information

    17. In order to be eligible to bid, applicants must submit 
Supplemental Information to the Commission. For this auction, the 
Supplemental Information will replace the FCC Form 175 that the FCC has 
used in previous auctions. This information must be received by the FCC 
no later than 5:30 p.m. Eastern Time on the fifth day from the 
publication of the DARS rules in the Federal Register. This date will 
be specified in a subsequent Public Notice. Late Supplemental 
Information will not be accepted. This supplemental information must be 
submitted by hand delivery, by certified U.S. mail, or by private 
courier. Electronic submissions will not be accepted. Applicants should 
carefully review 47 CFR 1.2101-1.2103, 1.2104(a) through (f), (h) and 
(i), and 25.401-25.406 of the Commission's rules before submitting the 
Supplemental Information.
Required Supplemental Information
    18. Because the FCC Form 175 is not required, bidders must submit 
the following supplemental information in printed form:
    a. Applicant Name.
    b. Mailing Address: Give a street address (not a Post Office box 
number) for the applicant, suitable for mail or private parcel 
delivery. The FCC will send all registration materials and other 
written communications to the contact person (specified in item j. 
below) at this address.
    c. City.
    d. State.
    e. Zip Code.
    f. Auction Number 15.
    g. FCC Account Number: Applicants must create a ten-digit FCC 
Account Number, which the Commission will use to identify and track 
applicants:
    *A bidder that has a taxpayer identification number (TIN) must 
create this FCC account number by using its TIN, plus the prefix of 
``0'' (i.e., 0123456789). A TIN is either the Employer Identification 
Number (EIN) in the case of a business, or the Social Security Account 
Number (SSAN) in the case of an individual.
     If--and only if--an applicant does not have a taxpayer 
identification number, the applicant should use its ten-digit area code 
and telephone number (i.e., 2025551234) on an interim basis. However, 
the FCC must have a TIN before it will be able to issue a license or 
refund upfront payments.
    Each applicant must include its FCC Account Number when submitting 
amendments, additional information, or other correspondence or 
inquiries regarding its application, and must include this same number 
on each FCC Form 159 (FCC Remittance Advice) accompanying required 
auction deposits or payments.
    h. Authorized Bidder(s): Applicants must list the name(s) of the 
person(s) (no more than three) authorized to represent them at the 
auction. Only those individuals listed on the Supplemental Information 
filing will be authorized to place or withdraw bids for the applicant 
during the auction.
    i. Name and Title of Person Certifying: Applicants should carefully 
read the following list of certifications. These certifications help to 
ensure a fair and competitive auction and require, among other things, 
disclosure to the Commission of certain information on applicant 
ownership and agreements or arrangements concerning the auction. The 
applicant must indicate the name and title of the certifying official. 
Submission of the Supplemental Information constitutes a representation 
by the certifying official that he or she is an authorized 
representative of the applicant, has read this Public Notice's 
instructions and certifications, and that the contents of the 
Supplemental Information and its attachments are true and correct. 
Submission of a false certification to the Commission may result in 
penalties, including monetary forfeitures, license forfeitures, 
ineligibility to participate in future auctions, and/or criminal 
prosecution. Applicants must certify the following:
    (a) The applicant is legally, technically, financially and 
otherwise qualified pursuant to 308(b) of the Communications Act and 
the Commission's rules and, to the extent that it applies, is in 
compliance with the foreign ownership provisions contained in section 
310 of the Communications Act;
    (b) The applicant is the real party-in-interest in this application 
and that there are no agreements or understandings other than those 
specified in the Supplemental Information, which provide that someone 
other than the applicant shall have an interest in the license;
    (c) The applicant is aware that, if upon Commission inspection, 
this Supplemental Information is shown to be defective, the application 
may be dismissed without further consideration, and certain fees 
forfeited. Other penalties may also apply;
    (d) The applicant, upon the deadline for filing the Supplemental 
Information, will not cooperate, collaborate, discuss, or disclose in 
any manner the substance of its bids or bidding strategies, or discuss 
or negotiate settlement agreements with other applicants until after 
the high bidder makes the required down payment;
    (e) The applicant, or any party to this Supplemental Information, 
is not subject to a denial of federal benefits pursuant to Section 5301 
of the Anti-Drug Abuse Act of 1988; and
    (f) The applicant is and will, during the pendency of its 
application and Supplemental Information, remain in compliance with any 
service-specific qualifications applicable to the license on which the 
applicant intends to bid including, but not limited to, financial 
qualifications.
    (g) The applicant is not in default on any Commission 
authorizations and it is not delinquent on any extension of credit from 
any federal agency.
    j. Contact Person: If the Commission wishes to communicate with the 
applicant by telephone or fax, those communications will be directed to 
the contact person identified on the Supplemental Information. Please 
provide a telephone number, fax number, and e-mail address (if 
available). All written communications and registration information 
will be directed to the applicant's contact person at the address 
specified on the Supplemental Information. Applicants must provide a 
street address; no Post Office Box addresses may be used.
    k. Signature and Date: The Supplemental Information must bear an 
original signature of the certifying official. Absence of an original 
signature

[[Page 13011]]

will result in dismissal of the application and disqualification from 
participation in the auction.
     In addition to this Supplemental Information, 
applicants must indicate the license(s) on which they intend to bid 
(i.e., EBN001 and/or EBN002).
    After the submission deadline for the supplemental information, the 
Commission will issue a Public Notice which will identify qualified and 
non-qualified applicants and the licenses for which each qualified 
applicant has applied. All applications are still subject to FCC 
approval.

C. Filing of Supplemental Information

    19. Auction applicants must file their Supplemental Information in 
hard copy. Whether the Supplemental Information is mailed, hand 
delivered or sent by private courier, it must be sent to:

Office of the Secretary, Attn: Auction 15 Supplemental Information 
Processing, Federal Communications Commission, 1919 M Street, NW., Room 
222, Washington, DC 20554

    20. Failure to sign Supplemental Information will result in 
dismissal of the application and inability to participate in the 
auction. Only original signatures will be accepted.

D. Application Fee

    21. There is no application fee required when filing Supplemental 
Information. However, to be eligible to bid, an applicant must submit 
an upfront payment. See Section E below.

E. Upfront Payments

    22. In order to be eligible to bid in the auction, applicants must 
submit an upfront payment together with an FCC Remittance Advice Form 
(FCC Form 159) to Mellon Bank.
    23. All payments must be made in U.S. dollars and must be in the 
form of a wire transfer. Payments must be received by 3:00 p.m. Eastern 
Time, Friday, March 28, 1997. Failure to deliver the upfront payment in 
a timely manner will result in dismissal of the application and 
inability to participate in the auction.
(1) Amount of Upfront Payments
    24. The upfront payment required to participate in the auction is 
$3 million. This fully qualifies bidders to participate on either 
license. See DARS Report and Order.
(2) Making Auction Payments by Wire Transfer
    25. To make an auction payment by wire transfer, an applicant must 
fax a completed FCC Remittance Advice Form (FCC Form 159) to Mellon 
Bank at (412) 236-5702 at least one hour prior to placing the order for 
the wire transfer (but on the same business day). On the cover sheet of 
the fax, the applicant should write ``Wire Transfer--Auction Payment 
for Auction Event #15''. To submit funds by wire transfer, you will 
need the following information:

ABA Routing Number: 043000261
Receiving Bank: Mellon Pittsburgh
BNF: FCC/AC--910-0198
OBI Field: (Skip one space between each information item)
``AUCTIONPAY''
FCC ACCOUNT NO. (SAME AS ITEM (g) ON SUPPLEMENTAL INFORMATION)
PAYMENT TYPE CODE (ADAU)
FCC CODE (``15'' INDICATING AUCTION 15)
PAYOR NAME (SAME AS ITEM (a) ON SUPPLEMENTAL INFORMATION)
LOCKBOX NO. 358410

    26. Given the abbreviated time period in which the Wireless 
Telecommunications Bureau must confirm receipt of upfront payments, the 
Bureau will require applicants to bring to the registration a wire 
transfer confirmation receipt from their bank certifying that the 
upfront payment funds have been transferred to the FCC account. This 
confirmation will serve as a reserve method to confirm that the 
required funds have been transferred to the FCC if there is any delay 
in obtaining electronic confirmation.
    27. Detailed directions for completing the FCC Form 159 and a 
sample form are attached to this Public Notice.

III. Registration for the Auction

    28. Only qualified applicants who have submitted timely upfront 
payments will be permitted to register for the auction. Registration 
will occur on March 31, 1997, from 2 p.m. ET to 3 p.m. ET at the FCC 
auction site. At least one authorized representative as stated in the 
applicant's Supplemental Information must register. This representative 
must have two forms of identification, one of which must be a photo 
identification. At the end of the registration process, bidders will be 
in possession of the following information:

 FCC Account Number (self-assigned in the Supplemental 
Information)
 Bidder Identification Number
 Login Name
 Login Password

    29. All applicants will be pre-registered prior to the auction 
event.
    30. Qualified bidders must be aware that lost login codes, 
passwords or bidder identification numbers can be replaced and/or 
distributed only at the FCC auction site located at 2 Massachusetts 
Avenue, NE, Washington, DC 20002. Please be advised that an authorized 
representative or certifying official, as designated on an applicant's 
Supplemental Information, must appear in person at the auction site 
with two forms of identification (one of which must be a photo 
identification) in order to receive replacement codes.
    31. The FCC will allow qualified bidders an opportunity to use the 
bidding software following registration on March 31, 1997 from 3 p.m. 
ET to 5 p.m. ET. Specific instructions for the mock auction will be 
provided at registration.

IV. Auction Event and Bidding Rounds

    32. The DARS auction will begin at 9 a.m. Eastern Time on Tuesday, 
April 1, 1997. Initially, bidding rounds are expected to last 30 
minutes to allow bidders to become familiar with the bid submission 
process. The FCC expects the length of the bidding rounds to decrease 
as the auction progresses. The Commission will adjust the pace of the 
auction based on its monitoring of the bidding and assessment of 
auction progress. The precise schedule for bidding will be included in 
the registration package.

V. Auction Procedures

    33. The two DARS licenses will be auctioned simultaneously. The 
high bid amount will be posted after the end of the bidding period. 
Information regarding all valid bids submitted in each round also will 
be posted.

A. Bid Submission and Withdrawal Procedures

(1) Bid Submission
    34. Bidders must place their bids electronically at the FCC auction 
site. Each bidder will be required to log in to the FCC auction 
computer system, using a login name and login password unique to that 
bidder, and in addition must provide its Bidder Identification Number 
and FCC Account Number in order to place or withdraw a bid.
    35. All accepted bids and the minimum valid bid amount for the next 
round will be announced after the conclusion of each bidding period. 
Bidders may receive a hard copy bid confirmation after they have 
submitted their bids by pressing the Print Bid Verification button on 
the Options screen.
    36. Bidders will have the option of making multiple submissions in 
each bidding period. This is a change in the procedures from previous 
auctions. If a bidder enters multiple bids for a license

[[Page 13012]]

in the same round, the system takes the last bid entered as that 
bidder's bid for the round. A bidder changing or removing a bid placed 
in the same round is not subject to bid withdrawal payments.
    37. Only persons authorized in the applicant's Supplemental 
Information to make or withdraw a bid will be allowed to enter the 
bidding booth. Each authorized representative will be required to show 
photo identification to enter the bidding booth.
(2) Bid Withdrawals
    38. A high bidder that withdraws its standing high bid is subject 
to the bid withdrawal payment specified in Sec. 1.2104(g)(1) of the 
Commission's rules. Bid withdrawal will be permitted only after a round 
in which there have been no new bids or proactive waivers. After a 
round with no new bids or proactive waivers, the Commission will 
specify a bid withdrawal period. If one or both of the standing high 
bids from a previous round are withdrawn, the Commission will reoffer 
the license or licenses in the next round. To prevent multiple 
withdrawals by the same party in the same auction, the Commission will 
bar a bidder who withdraws a bid from continued participation in that 
auction.
    39. The offer price for a withdrawn license will be the highest 
price at or above which bids were made by four distinct bidders in any 
previous round and on any license. If there is no price at or above 
which bids were made in previous rounds by four bidders, then the 
Commission will reoffer the license in the next round at the minimum 
opening bid for the license. The Commission may at its discretion 
reduce the offering price in subsequent rounds if it receives no bids 
at this price. Prior to restarting the auction, the Commission will 
also restore the eligibility of all bidders who have not withdrawn. If 
eligibility is not restored, it is possible, given the activity rules, 
that no bidders would be eligible to bid when a license is reoffered 
after a bid withdrawal. Restoring eligibility of all but those who 
withdrew will ensure the maximum number of sincere bidders for the 
license when the auction is restarted. After a withdrawal, the 
Commission will also issue each eligible bidder one activity rule 
waiver in addition to any remaining waivers, subject to a maximum of 
three, to provide additional time for bid preparation and to avoid 
accidental disqualification.

B. Minimum Opening Bid, Bid Increments, and Tie Bids

(1) Minimum Opening Bid
    40. The FCC believes that it is useful to have a minimum opening 
bid to help move the auction along. Therefore, the Commission has 
established a minimum opening bid of $8 million each for these 
licenses. Based on our observations of the market, the FCC believes 
this minimum opening bid is high enough to move the auction along at a 
rapid pace, but significantly below the expected final bid for the 
spectrum. See DARS Report and Order, para. 159.
(2) Bid Increments
    41. The minimum bid increment is the amount or percentage by which 
a bid must be raised above the previous high bid in order to be 
accepted as a valid bid in the current round. The amount of the minimum 
valid bid for each license (generally, the sum of the minimum bid 
increment and the high bid from the previous round) will be announced 
at the beginning of each round. See 47 CFR 25.402.
    42. Once a bid has been received for a license, the minimum bid 
increment will be ten (10) percent of the previous high bid on that 
license. The Commission retains the discretion to establish, raise and 
lower minimum bid increments in the course of the auction. This 
discretion is necessary to ensure that the Commission can efficiently 
control the pace of the auction.
(3) Tie Bids
    43. Each bid will be date and time stamped when it is entered into 
the computer system. In the event of tie bids, the Wireless 
Telecommunications Bureau will identify the high bidder on the basis of 
the order in which bids are received, starting with the earliest bid. 
See 47 CFR 25.402.

C. Activity Rules

    44. In order to ensure that the auction closes within a reasonable 
period of time, the Commission will impose an activity rule to 
discourage bidders from waiting until the end of the auction before 
participating. See generally 47 CFR 25.402.
(1) Activity Requirements
    45. Bidders must be active on one license in each round of the 
auction or use an activity rule waiver, as defined below. Bidders will 
not be permitted to be active on more than one license in a single 
round. To be active in the current round, a bidder must submit a valid 
bid in the current round or have the high bid from the previous round. 
A bidder who is not active in a round and has no remaining activity 
rule waivers will no longer be eligible to bid on the licenses being 
auctioned. However, as discussed above, in the event of a bid 
withdrawal, the eligibility of all bidders who have not withdrawn will 
be restored.
(2) Activity Rule Waivers
    46. Bidders will be provided three activity rule waivers that may 
be used in any round during the course of the auction. A waiver will 
preserve eligibility in the next round. Waivers may be applied 
automatically by the Commission or invoked proactively by bidders. If a 
bidder is not active in a round, a waiver will be applied automatically 
if any waivers remain. An automatic waiver applied in a round in which 
there are no new valid bids will not keep the auction open. A proactive 
activity rule waiver is a waiver invoked by a bidder during the bidding 
period. If a bidder submits a proactive waiver in a round in which no 
other bidding activity occurs, the auction will remain open. Therefore, 
if a bidder does not intend to bid but wants to ensure that the auction 
does not close, it should enter a proactive waiver in place of a bid.
    47. The Commission retains the discretion to issue additional 
waivers during the course of the auction for circumstances beyond a 
bidder's control or in the event of a bid withdrawal, as discussed 
above.

D. Stopping Rules

    48. A stopping rule specifies when an auction is over. The auction 
will close after one round passes in which no new valid bids or 
proactive waivers are submitted on both licenses, subject to the 
following two qualifications. First, if a high bidder withdraws its bid 
during the bid withdrawal period the Commission will reoffer the 
license in the next round as specified in Section A.2 above. Second, 
the Commission retains the discretion to keep an auction open even if 
no new valid bids and no proactive waivers are submitted. In the event 
that the Commission exercises this discretion, the effect will be the 
same as if a bidder had submitted a proactive waiver. See 
Implementation of Section 309(j) of the Communications Act--Competitive 
Bidding, Second Report and Order, 59 FR 22980 (May 4, 1994).

VI. Delay, Suspension or Cancellation of the Auction

    49. The Commission may, by Public Notice or by announcement during 
the auction, delay, suspend or cancel the auction in the event of 
natural disaster,

[[Page 13013]]

technical obstacle, evidence of auction security breach, unlawful 
bidding activity, administrative necessity, or for any other reason 
that affects the fair and competitive conduct of competitive bidding. 
In such cases, the Commission may, in its sole discretion, resume the 
auction starting from the beginning of the current or some previous 
round or cancel the auction in its entirety.

VII. Default and Disqualification Payments

    50. A default payment will be assessed if a winning bidder fails to 
pay the full amount of its 20 percent down payment or the balance of 
its winning bid in a timely manner, or is disqualified after the close 
of an auction. The amount of this default payment will be equal to the 
difference between the defaulting auction winner's ``winning'' bid and 
the amount of the winning bid the next time the license is offered for 
auction by the Commission, if the latter bid is lower. In addition, the 
defaulting auction winner will be required to submit a payment of three 
percent of the subsequent winning bid or three percent of its own 
``winning'' bid, whichever is less. See 47 CFR 25.406. In the event 
that the amount of those payments cannot be determined (i.e., until the 
license has been reauctioned), the FCC can require a ``deposit'' of at 
least three (3) percent, and at most twenty (20) percent, of the 
defaulted bid amount. See In Re C. H. PCS, Inc., BTA No. B347 Frequency 
Block C, Order, DA 96-1825 (released November 4, 1996). See also 
Wireless Telecommunications Will Strictly Enforce Default Payment 
Rules, Public Notice, 61 FR 16914 (April 18, 1996).
    51. If withdrawal, default or disqualification involves gross 
misconduct, misrepresentation or bad faith by an applicant, the 
Commission retains the option to declare the applicant and its 
principals ineligible to bid in future auctions, or take any other 
actions the Commission deems necessary, including institution of 
proceedings to revoke any existing licenses held by the applicant. See 
Implementation of section 309(j) of the Communications Act--Competitive 
Bidding, Second Report and Order.

VIII. Releasing Bidder Identities

    52. Bidders' identities and FCC account numbers will be disclosed 
prior to the auction. Thus, bidders will know in advance of the auction 
the identities of the bidders against whom they are bidding.

IX. Collusion

    53. To prevent collusion, Sec. 25.405 of the Commission's rules 
prohibits applicants, after the deadline for filing Supplemental 
Information and before down payments are submitted, from cooperating, 
collaborating, discussing, or disclosing in any manner the substance of 
their bids or bidding strategies, or discussing or negotiating 
settlement agreements with other applicants. See 47 CFR 25.405.

X. Post-Auction Procedures

A. Down Payment

    54. The winning bidder for each license must submit sufficient 
additional funds (a ``down payment'') to bring the amount of money on 
deposit (not including upfront payments applied to satisfy bid 
withdrawal or default payments) with the government to 20 percent of 
its winning bid within ten (10) business days after the high bidder is 
announced. See 47 CFR 25.404.
    55. Specific information regarding the submission of down payments 
will be included in the Public Notice announcing the winning bidders.

B. Submission of License Application and Award of Licenses

    56. The winning bidder for each license also will be required to 
file information in conformance with part 25 of the Commission's rules. 
This procedure will constitute the ``long-form application'' process 
referred to in our general auction rules. Winning bidders must file 
this information with the Commission within 30 days of the publication 
of the Public Notice announcing the winning bidders. Winning bidders 
must submit, as part of this post-auction application process, a signed 
statement describing their efforts to date and future plans to come 
into compliance with any applicable spectrum limitations, if they are 
not already in compliance. See 47 CFR 25.404.
    57. After reviewing a winning bidder's information supplied in 
conformance with Part 25 and determining that the bidder is qualified 
to be a licensee, and after verifying receipt of the bidder's 20 
percent down payment, the Commission will announce the application's 
acceptance for filing in a Public Notice, thus triggering the filing 
window for petitions to deny. If, pursuant to section 309(d) of the 
Communications Act, the Commission dismisses or denies any and all 
petitions to deny, the Commission will issue a Public Notice announcing 
this, and the winning bidder will then have ten business days to submit 
the balance of its winning bid. If the bidder does so, the license will 
be granted subject to a condition, if necessary, that the permittee 
come into compliance with any applicable spectrum limitations within 12 
months of the final grant. The licensee may come into compliance with 
this spectrum cap by either surrendering to the Commission its excess 
channels or filing an application that would result in divestiture of 
the excess channels. If the bidder fails to submit the balance of the 
winning bid or the license is otherwise denied, the FCC will assess a 
default payment as set forth above and reauction the license. See 
Section VII of this Public Notice.

C. Refund of Upfront Money

    58. All applicants who submitted upfront payments, yet were not 
winning bidders, may be entitled to a refund of their upfront payments 
after the conclusion of the auction. Any refund will be conditioned 
upon the existence of excess funds on deposit after any applicable bid 
withdrawal payments have been deducted.
    59. Because experience with prior auctions has shown that in most 
cases wire transfers provide quicker and more efficient refunds than 
paper checks, the FCC currently intends to use wire transfers for all 
Auction 15 refunds. To avoid delays in processing refunds, applicants 
should include wire transfer instructions with any refund request they 
file; they may also provide this information in advance by faxing it to 
the FCC Billings and Collections Branch, ATTN: Regina Dorsey or Linwood 
Jenkins, at 202-418-2843. (Applicants should also note that 
implementation of the Debt Collection Improvement Act of 1996 requires 
the FCC to obtain a Taxpayer Identification Number before it can 
disburse funds.) In lieu of faxing, please mail the information to:

Federal Communications Commission, ATTN: Linwood Jenkins, 1919 M 
Street, NW., Room 450, Washington, DC 20554

D. Construction Requirements

    60. Licensees in satellite DARS must begin construction of or 
complete contracting for construction of their space stations within 
one year of license grant; launch and begin operating their first 
satellite within four years; and begin operating their entire system 
within six years. Failure to meet these milestone requirements will 
result in forfeiture of the license, and the licensee will be 
ineligible to regain it. See 47 CFR 25.214(b).

[[Page 13014]]

XI. Bidder Alert

    61. The terms contained in the Commission's Rules, Reports, Orders, 
and Public Notices are not negotiable. Prospective bidders should 
review these auction documents thoroughly prior to the auction to make 
certain that they understand all of the provisions and are willing to 
be bound by all of the terms before making any bid.
    62. All applicants must certify under penalty of perjury on their 
Supplemental Information that they are legally, technically, 
financially and otherwise qualified to hold a DARS license. Prospective 
bidders are reminded that submission of a false certification to the 
Commission is a serious matter that may result in severe penalties 
including monetary forfeitures, license revocations, being barred from 
participating in future auctions, and/or criminal prosecution.
    63. The FCC makes no representations or warranties about the use of 
this spectrum for particular services. Applicants should be aware that 
an FCC auction represents an opportunity to become an FCC licensee in 
this service, subject to certain conditions and regulations. An FCC 
auction does not constitute an endorsement by the FCC of any particular 
services, technologies or products, nor does an FCC license constitute 
a guarantee of business success. Applicants should perform their 
individual due diligence before proceeding as they would with any new 
business venture.

Federal Communications Commission.
William F. Caton,
Acting Secretary.

Attachment A--Federal Communications Commission; DARS Licenses Auction

Auction Specific Instructions FCC Remittance Advice, FCC Form 159

Upfront Payments

    The following instructions are specifically written for the 
auction of DARS licenses. These instructions are intended as a 
supplement to the standard instructions issued by the FCC's Billings 
and Collections Branch, at telephone number (202) 418-1995. Bidders 
should ensure that they complete the FCC Form 159 accurately, since 
mistakes may affect their bidding eligibility. Please note that it 
is vital that all forms, applications, correspondence, etc. 
submitted to the Commission by an applicant contain identical 
information necessary for verification purposes. To this end, 
appropriate references between the FCC Form 159 Remittance Advice 
and the Supplemental Information have been provided below:

------------------------------------------------------------------------
      Block No.                       Required information              
------------------------------------------------------------------------
1....................  FCC Account Number--Same as Supplemental         
                        Information item ``g''. A bidder that has a     
                        taxpayer identification number (TIN) must create
                        this FCC account number by using its TIN, plus  
                        the prefix of ``0'' (i.e., 0123456789). A TIN is
                        either the Employer Identification Number (EIN) 
                        in the case of a business, or the Social        
                        Security Account Number (SSAN) in the case of an
                        individual.                                     
2....................  Total Amount Paid--Enter the total remittance    
                        based on the payment amount. To bid in this     
                        auction, the upfront payment is $3,000,000.     
3....................  Payor Name--Enter the full name of the person or 
                        company (i.e., maker of the check) responsible  
                        for payment.                                    
4....................  Street Address (Line 1)--Same as Supplemental    
                        Information item ``b''. The street address to   
                        which correspondence should be sent.            
5....................  Street Address (Line 2)--Same as Supplemental    
                        Information item ``b''. This line may be used if
                        further identification of the address is        
                        required.                                       
6....................  City--Same as provided in Supplemental           
                        Information item ``c''. The name of the city    
                        associated with the street address given in     
                        block (4) of the FCC Form 159.                  
7....................  State--Same as provided in Supplemental          
                        Information item ``d''. Enter the appropriate   
                        two-character abbreviation here.                
8....................  Zip Code--Same as provided in Supplemental       
                        Information item ``e''. Enter the appropriate   
                        five-digit or nine-digit code here.             
9....................  Daytime Telephone Number--Same as provided in    
                        Supplemental Information item ``j''. Enter the  
                        ``payor's'' ten-digit telephone number here.    
10...................  Country Code--Used for payors who have addresses 
                        outside the U.S. Proper codes may be obtained   
                        from the Mailing Requirements Dept. of the U.S. 
                        Postal Service.                                 
------------------------------------------------------------------------
Note--If applicant, licensee, regulatee or debtor is the same as the    
  payor, do not complete blocks 11, 13, 18, 19, 20, & 21. This auction  
  does not involve multiple applications or filings, so the FCC is      
  concerned only with the remaining blocks 12A, 14A, 15A, 16A & 17A.    


------------------------------------------------------------------------
                                    Item # ``1'' information            
------------------------------------------------------------------------
12A..................  FCC Call Sign/Other Identifier--Leave blank.     
14A..................  Payment Type Code--Enter A D A U.                
15A..................  Quantity--Enter the number ``1''.                
16A..................  Amount Due--Enter total upfront payment indicated
                        in block (2).                                   
17A..................  FCC Code 1--Enter the number ``15''.             
------------------------------------------------------------------------
Note. In the upper left hand corner of the FCC form 159 is a rectangle  
  with the word ``(RESERVED)'' typed in the middle of it. Please enter  
  the number ``358410'' somewhere in this rectangle.                    


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Attachment B.--FCC Remittance Advice (FCC Form 159) and Instructions 
for Using FCC Form 159 (Remittance Advice)
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[FR Doc. 97-6832 Filed 3-18-97; 8:45 am]
BILLING CODE 6712-01-C