[Federal Register Volume 68, Number 58 (Wednesday, March 26, 2003)]
[Notices]
[Pages 14640-14656]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-7190]


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FEDERAL COMMUNICATIONS COMMISSION

[Report No. AUC-03-49-C (Auction No. 49); DA 03-567]


Auction of Licenses in the Lower 700 MHz Band Scheduled for May 
28, 2003; Notice and Filing Requirements, Minimum Opening Bids, Upfront 
Payment and Other Auction Procedures

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: This document announces the procedures and minimum opening 
bids for the upcoming auction of licenses in the lower 700 MHz band 
scheduled for May 28, 2003. This document is intended to familiarize 
prospective bidders with the procedures and minimum opening bids for 
this auction.

DATES: Auction No. 49 is scheduled to begin on May 28, 2003.

FOR FURTHER INFORMATION CONTACT: Auctions and Industry Analysis 
Division: Howard Davenport, Legal Branch, or Lyle Ishida, Auctions 
Operations Branch, at (202) 418-0660; Linda Sanderson, Auctions 
Operations Branch, at (717) 338-2888, Media Contact: Lauren Kravetz at 
(202) 418-7944, Commercial Wireless Division: Policy and Rules Branch, 
Amal Abdallah at (202) 418-7307 or Evan Baranoff at (202) 418-7142; 
Licensing and Technical Analysis Branch, Joanne Epps or Keith Harper, 
at (202) 418-0620, Media Bureau: Engineering Division, Gordon Godfrey 
at (202) 418-2193.

SUPPLEMENTARY INFORMATION: This is a summary of the Auction No. 49 
Procedures Public Notice released on March 4, 2003. The complete text 
of the Auction No. 49 Procedures Public Notice, including attachments, 
is available for public inspection and copying during regular business 
hours at the FCC Reference Information Center, Portals II, 445 12th 
Street, SW., Room CY-A257, Washington, DC, 20554. The Auction No. 49 
Procedures Public Notice may also be purchased from the Commission's 
duplicating contractor, Qualex International, Portals II, 445 12th 
Street, SW., Room CY-B402, Washington, DC, 20554, telephone 202-863-
2893, facsimile 202-863-2898, or via e-mail [email protected].

I. General Information

A. Introduction

    1. By the Auction No. 49 Procedures Public Notice, the Wireless 
Telecommunications Bureau (``Bureau'') announces the procedures and 
minimum opening bids for the upcoming auction of licenses in the Lower 
700 MHz C and D blocks, (the 710-716/740-746 MHz and 716-722 MHz bands) 
scheduled for May 28, 2003 (Auction No. 49). On December 2, 2002, in 
accordance with the Balanced Budget Act of 1997, the Bureau released a 
public notice seeking comment on reserve prices or minimum opening bids 
and the procedures to be used for the auction of 251 licenses in the 
Lower 700 MHz band C block. The Bureau received five comments and five 
reply comments in response to the Auction No. 49 Comment Public Notice, 
67 FR 72946 (December 9, 2002). On January 29, 2003, the Bureau 
released a public notice announcing a revised auction inventory to 
include five licenses in the Lower 700 MHz band D block. In the Auction 
No. 49 Revised Comment Public Notice, 68 FR 6452 (February 7, 2003), 
the Bureau sought comment on the procedural issues related to the 
auction of the D block licenses. In the Auction No. 49 Revised Comment 
Public Notice, the Bureau also revised the starting date for Auction 
No. 49. The Bureau received two comments and two reply comments in 
response to the Auction No. 49 Revised Comment Public Notice.
i. Background of Proceeding
    2. On January 18, 2002, the Commission released the Lower 700 MHz 
Report & Order, 67 FR 5491 (February 6, 2002), which adopted allocation 
and service rules for the Lower 700 MHz Band. Specifically, the 
Commission reallocated the entire 48 megahertz of spectrum in the Lower 
700 MHz band to fixed and mobile services and retained the existing 
broadcast allocation for both new broadcast services and incumbent 
broadcast services during their transition to digital television 
(``DTV''). The Commission established technical criteria designed

[[Page 14641]]

to protect incumbent television operations in the band during the DTV 
transition period, allowed low power television (``LPTV'') and TV 
translator stations to retain secondary status and operate in the band 
after the transition, and set forth a mechanism by which pending 
broadcast applications may be amended to provide analog or digital 
service in the core television spectrum or to provide digital service 
on TV Channels 52-58.
    3. In its service rules, the Commission divided the Lower 700 MHz 
band into three 12-megahertz blocks, with each block consisting of a 
pair of 6-megahertz segments, and two 6-megahertz blocks of contiguous, 
unpaired spectrum. The Commission decided to divide the five blocks in 
the Lower 700 MHz band plan as follows: the two 6-megahertz blocks of 
contiguous unpaired spectrum, as well as two of the three 12-megahertz 
blocks of paired spectrum, were assigned over six Economic Area 
Groupings (``EAGs''); the remaining 12 megahertz block of paired 
spectrum was assigned over 734 Metropolitan Statistical Areas 
(``MSAs'') and Rural Service Areas (``RSAs''). All operations in the 
Lower 700 MHz band are generally regulated under the framework of Part 
27's technical, licensing, and operating rules. To permit both wireless 
services and certain new broadcast operations in the Lower 700 MHz 
band, however, the Commission has amended the maximum power limits in 
Part 27 to permit 50 kW effective radiated power (``ERP'') 
transmissions in the Lower 700 MHz band, subject to certain conditions. 
Finally, the Commission established competitive bidding procedures and 
voluntary band-clearing mechanisms for the Lower 700 MHz band. On June 
14, 2002, the Commission affirmed its decisions in the Lower 700 MHz 
Report and Order.
    4. With respect to the MSA and RSA licenses, the Bureau notes that 
MSAs and RSAs are collectively known as Cellular Market Areas (CMAs). 
CMAs were created from the Metropolitan Statistical Areas (``MSAs'') 
defined by the Office of Management and Budget (CMA001-CMA305), the 
Gulf of Mexico (CMA306), and Rural Service Areas (``RSAs'') established 
by the FCC (CMA307-CMA734). These RSAs include parts of Puerto Rico not 
already in an MSA (CMA723-CMA729), U.S. Virgin Islands (CMA730-CMA731), 
Guam (CMA732), American Samoa (CMA733), and Northern Mariana Islands 
(CMA734). The CMA designation, rather than MSA/RSA, is used in the FCC 
Automated Auction System and in the Universal Licensing System.
ii. Licenses To Be Auctioned
    5. Auction No. 49 will offer 256 licenses in the Lower 700 MHz band 
C block (710-716/740-746 MHz) and D block (716-722 MHz). This auction 
will include 251 C block and five D block licenses that remained unsold 
in Auction No. 44, which closed on September 18, 2002. The C block is a 
12-megahertz block consisting of a pair of 6-megahertz segments, which 
is licensed over various MSAs/RSAs. The D block is a 6-megahertz 
unpaired spectrum block, which is licensed over five 700 MHz Economic 
Area Groupings (``700 MHz EAGs''). A complete list of licenses 
available in Auction No. 49 and their descriptions is included in 
Attachment A of the Auction No. 49 Procedures Public Notice.
    6. The following table contains the block/frequency cross-reference 
for the 710-716/740-746 MHz and 716-722 MHz bands:

----------------------------------------------------------------------------------------------------------------
                                                                                Geographic area      Number of
      Block           Frequencies          Bandwidth            Pairing              type            licenses
----------------------------------------------------------------------------------------------------------------
C...............  710-716, 740-746..  12 MHz............  2 x 6 MHz.........  MSA/RSA...........             251
D...............  716-722...........  6 MHz.............  unpaired..........  700 MHz EAG.......               5
----------------------------------------------------------------------------------------------------------------


    Note: For Auction No. 49, licenses are not available in every 
market for the frequency blocks listed in the table. See Attachment 
A of the Auction No. 49 Procedures Public Notice to determine which 
licenses will be offered.)

A. Rules and Disclaimers

i. Relevant Authority
    7. Prospective bidders must familiarize themselves thoroughly with 
the Commission's rules relating to the Lower 700 MHz band contained in 
title 47, part 27 of the Code of Federal Regulations, and those 
relating to application and auction procedures, contained in title 47, 
part 1 of the Code of Federal Regulations. Prospective bidders must 
also be thoroughly familiar with the procedures, terms and conditions 
(collectively, ``terms'') contained in the Auction No. 49 Procedures 
Public Notice; the Auction No. 49 Comment Public Notices; and the Part 
1 Fifth Report and Order, 65 FR 52323 (August 29, 2000), (as well as 
prior and subsequent Commission proceedings regarding competitive 
bidding procedures).
    8. Auction participants bidding on licenses in the 698-746 MHz 
spectrum band should also be familiar with the Lower 700 MHz Notice of 
Proposed Rulemaking, 66 FR 19106 (April 13, 2001), the Lower 700 MHz 
Report and Order and the Lower 700 MHz MO&O, 67 FR 45380 (July 9, 
2002).
    9. The terms contained in the Commission's rules, relevant orders, 
and public notices are not negotiable. The Commission may amend or 
supplement the information contained in our public notices at any time, 
and will issue public notices to convey any new or supplemental 
information to bidders. It is the responsibility of all prospective 
bidders to remain current with all Commission rules and with all public 
notices pertaining to this auction. Copies of most Commission 
documents, including public notices, can be retrieved from the FCC 
Auctions Internet site at http://wireless.fcc.gov/auctions. 
Additionally, documents are available for public inspection and copying 
during regular business hours at the FCC Reference Information Center, 
Portals II, 445 12th Street, SW, Room CY-A257, Washington, DC, 20554, 
or may be purchased from the Commission's duplicating contractor, 
Qualex International, Portals II, 445 12th Street, SW, Room CY-B402, 
Washington, DC 20554, telephone 202-863-2893, facsimile 202-863-2898, 
or via e-mail [email protected]. When ordering documents from Qualex, 
please provide the appropriate FCC document number (for example, FCC 
01-364 for the Lower 700 MHz Report and Order).
ii. Prohibition of Collusion
    10. To ensure the competitiveness of the auction process, the 
Commission's rules prohibit applicants for the same geographic license 
area from communicating with each other during the auction about bids, 
bidding strategies, or settlements. This prohibition begins at the 
short-form application filing deadline and ends at the down payment 
deadline after the auction. Bidders competing for licenses in the same 
geographic license areas are encouraged not to use the same individual 
as an authorized bidder. A violation of the anti-collusion rule could

[[Page 14642]]

occur if an individual acts as the authorized bidder for two or more 
competing applicants and conveys information concerning the substance 
of bids or bidding strategies between the bidders he or she is 
authorized to represent in the auction. A violation could similarly 
occur if the authorized bidders are different individuals employed by 
the same organization (e.g., law firm or consulting firm). In such a 
case, at a minimum, applicants should certify on their applications 
that precautionary steps have been taken to prevent communication 
between authorized bidders and that applicants and their bidding agents 
will comply with the anti-collusion rule.
    11. However, the Bureau cautions that merely filing a certifying 
statement as part of an application will not outweigh specific evidence 
that collusive behavior has occurred, nor will it preclude the 
initiation of an investigation when warranted. The Commission's anti-
collusion rules allow applicants to form certain agreements during the 
auction, provided the applicants have not applied for licenses covering 
the same geographic areas. In Auction No. 49, for example, the rule 
would apply to any applicants bidding for the same MSA/RSA or EAG. 
Furthermore, the rule would apply to an applicant bidding for an EAG 
and another applicant bidding for an MSA/RSA within that EAG. In 
addition, applicants that apply to bid for all markets would be 
precluded from communicating with all other applicants until after the 
down payment deadline. However, all applicants may enter into bidding 
agreements before filing their FCC Form 175, as long as they disclose 
the existence of the agreement(s) in their Form 175. If parties agree 
in principle on all material terms prior to the short-form filing 
deadline, those parties must be identified on the short-form 
application pursuant to Sec.  1.2105(c), even if the agreement has not 
been reduced to writing. If the parties have not agreed in principle by 
the filing deadline, an applicant would not include the names of those 
parties on its application, and may not continue negotiations with 
other applicants for licenses covering the same geographic areas. By 
signing their FCC Form 175 short-form applications, applicants are 
certifying their compliance with Sec.  1.2105(c).
    12. In addition, Sec.  1.65 of the Commission's rules requires an 
applicant to maintain the accuracy and completeness of information 
furnished in its pending application and to notify the Commission 
within 30 days of any substantial change that may be of decisional 
significance to that application. Thus, Sec. Sec.  1.65 and 1.2105 
require an auction applicant to notify the Commission of any violation 
of the anti-collusion rules upon learning of such violation. Bidders 
therefore are required to make such notification to the Commission 
immediately upon discovery.
    13. A summary listing of documents from the Commission and the 
Bureau addressing the application of the anti-collusion rules may be 
found in Attachment G of the Auction No. 49 Procedures Public Notice.
iii. Interference Protection of Television Services
    14. Among other licensing and technical rules, new Lower 700 MHz 
band licensees must comply with the interference protection 
requirements set forth in Sec.  27.60 of the Commission's rules. 
Generally, Sec.  27.60 establishes standards for protection of co- and 
adjacent-channel analog TV and DTV facilities. Thus, for example, a new 
licensee seeking to operate on the D block (716-722 MHz) portion of the 
Lower 700 MHz band must provide co-channel protection to nearby TV and 
DTV operations on Channel 55 and adjacent-channel protection to 
stations on Channels 54 and 56. New Lower 700 MHz band licensees should 
also be aware that incumbent broadcasters may be permitted to make 
certain changes to their authorized facilities. Such modified 
facilities may be entitled to interference protection from new Lower 
700 MHz band licensees. In addition, Appendix D of the Lower 700 MHz 
Report and Order describes additional adjacent-channel interference 
considerations that are designed to mitigate the possibility of base-
to-base interference that may arise at base receive stations that are 
in close proximity to high power transmitters operating on adjacent 
channels. Moreover, licensees intending to operate a facility at a 
power level of greater than 1 kilowatt must provide advance notice to 
the Commission and to licensees authorized in their area of operation. 
New Lower 700 MHz licensees also will have to comply with any 
additional technical requirements or interference protection 
requirements that may be adopted in the future as a result of pending 
and future rulemaking proceedings.
    15. Potential bidders should recognize that the interference 
protection requirements for the Lower 700 MHz band are more stringent 
in certain respects relative to the interference standards that apply 
to the Upper 700 MHz band. These interference obligations will remain 
in force until the end of the DTV transition period at which time 
analog TV and DTV broadcasters will be required to vacate both the 
Upper and Lower 700 MHz bands.
    16. Potential bidders should be aware that a greater number of 
broadcast incumbents exist in the Lower 700 MHz band relative to the 
Upper 700 MHz band. The Commission has also observed that, although 
there is approximately the same number of analog incumbents in both the 
Upper and Lower 700 MHz bands, the Lower 700 MHz consists of less 
spectrum and, therefore, incumbent licensees are more densely situated 
across the band. Further, there is a significantly greater number of 
DTV assignments on the eight television channels in the Lower 700 MHz 
band, including licenses, construction permits, pending applications, 
and pending allotment petitions, than exist in the Upper 700 MHz band. 
The Commission may also permit certain Channel 60-69 broadcasters to 
relocate temporarily into Channels 52-58 pursuant to a voluntary 
clearing arrangement.
a. Negotiations With Incumbent Broadcast Licenses
    17. The Commission has established a policy of facilitating 
voluntary clearing of the 700 MHz bands to allow for the introduction 
of new wireless services and to promote the transition of incumbent 
analog television licensees to DTV service. Generally speaking, this 
policy provides that the Commission will consider specific regulatory 
requests needed to implement voluntary agreements between incumbent 
broadcasters and new licensees to clear the Lower 700 MHz band early, 
if consistent with the public interest. The fundamentals of the 
Commission's voluntary clearing policy for the 700 MHz bands were 
established in a series of decisions beginning with the adoption of the 
Upper 700 MHz First Report and Order in January 2000. However, in light 
of certain differences between the Upper and Lower 700 MHz bands, the 
Commission decided not to extend certain aspects of its voluntary 
clearing policy to the Lower 700 MHz band, including the presumptions 
that were established in the Upper 700 MHz band for analyzing voluntary 
band-clearing proposals and the extended DTV construction period that 
was provided to certain single-channel broadcasters in connection with 
the arrangements for early clearing of the Upper 700 MHz band. In 
considering such regulatory requests, the Commission will consider 
whether

[[Page 14643]]

grant of the request would result in public interest benefits, such as 
making new or expanded public safety or other wireless services 
available to consumers or deploying wireless service to rural or other 
underserved communities. The Commission intends to weigh these benefits 
against any likely public interest costs, such as the loss of any of 
the four stations in the designated market area with the largest 
audience share, the loss of the sole service licensed to the local 
community, the loss of a community's sole service on a channel reserved 
for noncommercial educational broadcast service, or a negative effect 
on the pace of the DTV transition in the market.
    18. Subsequent to the adoption by the Commission of its voluntary 
clearing policy, the Auction Reform Act of 2002 was enacted. One 
provision of this legislation restricts the Commission's authority to 
waive certain broadcast interference standards and the minimum spacing 
requirements for certain proposals to relocate Channel 52-69 analog 
operations to a Channel 2-51 DTV allotment, if such waiver ``will 
result in any degradation in or loss of service, or an increased level 
of interference to any television household except as the Commission's 
rules would otherwise expressly permit, exclusive of any waivers 
previously granted.''
b. Canadian and Mexican Border Regions
    19. The United States has bilateral agreements with both Canada and 
Mexico setting forth allotment and assignment plans for TV broadcast 
stations covering the 698-746 MHz band (Channels 52-59). While the U.S. 
has identified this band for reallocation to new services, neither 
Canada nor Mexico has done so to date. Pursuant to these agreements, 
the U.S. must protect the signals of Canadian and Mexican TV broadcast 
stations located in the border areas, and such operations will 
therefore affect U.S. non-broadcast use and services in this band. 
Accordingly, licenses issued for this band will be subject to whatever 
future agreements the U. S. develops with these two countries. 
Furthermore, until such time as existing agreements are replaced or 
modified to reflect the new uses, licensees in the band will be subject 
to existing agreements and the condition that harmful interference not 
be caused to, and must be accepted from, television broadcast 
operations in those countries.
iv. Due Diligence
    20. Potential bidders are reminded that there are a number of 
incumbent broadcast television licensees already licensed and operating 
in the 710-716/740-746 MHz and 716-722 MHz bands that will be subject 
to the upcoming auction. As discussed in greater detail, the Commission 
made clear that geographic area licensees operating on the spectrum 
associated with Channels 52, 53, 54, 55, 56, 57, 58 and 59 must comply 
with the co-channel and the adjacent channel provision of Sec.  27.60 
of the Commission's rules. These limitations may restrict the ability 
of such geographic licensees to use certain portions of the 
electromagnetic spectrum or provide service to certain regions in their 
geographic license areas.
    21. Potential bidders are solely responsible for identifying 
associated risks and for investigating and evaluating the degree to 
which such matters may affect their ability to bid on, otherwise 
acquire, or make use of licenses available in Auction No. 49.
    22. To aid potential bidders, the Bureau will issue shortly a Due 
Diligence Announcement listing incumbent licensees operating in these 
bands. The Commission makes no representations or guarantees that the 
matters listed in this Due Diligence Announcement are the only pending 
matters that could affect spectrum availability in these services.
    23. Potential bidders also should be aware that certain 
applications (including those for modification), petitions for 
rulemaking, requests for special temporary authority (``STA''), waiver 
requests, petitions to deny, petitions for reconsideration, and 
applications for review may be pending before the Commission and relate 
to particular applicants or incumbent licensees. In addition, certain 
judicial proceedings that may relate to particular applicants or 
incumbent licensees, or the licenses available in Auction No. 49, may 
be commenced, or may be pending, or may be subject to further review. 
We note that resolution of these matters could have an impact on the 
availability of spectrum in Auction No. 49. In addition, although the 
Commission will continue to act on pending applications, requests and 
petitions, some of these matters may not be resolved by the time of the 
auction. To aid potential bidders, the Bureau will issue shortly a Due 
Diligence Announcement listing matters pending before the Commission 
that relate to licenses or applications in these services. The 
Commission makes no representations or guarantees that the matters 
listed in the Due Diligence Announcement are the only pending matters 
that could affect spectrum availability in these services.
    24. In addition, potential bidders may research the licensing 
database for the Media Bureau on the Internet in order to determine 
which frequencies are already licensed to incumbent licensees. The 
Commission makes no representations or guarantees regarding the 
accuracy or completeness of information in its databases or any third 
party databases, including, for example, court docketing systems. 
Furthermore, the Commission makes no representations or guarantees 
regarding the accuracy or completeness of information that has been 
provided by incumbent licensees and incorporated into the database. 
Potential bidders are strongly encouraged to physically inspect any 
sites located in, or near, the EAG, MSA or RSA for which they plan to 
bid.
    25. Licensing records for the Media Bureau are contained in the 
Media Bureau's Consolidated Data Base System (CDBS) and may be 
researched on the Internet at http://www.fcc.gov/mb/. Potential bidders 
may query the database online and download a copy of their search 
results if desired. Detailed instructions on using Search for Station 
Information, Search for Ownership Report Information and Search for 
Application Information and downloading query results are available 
online by selecting the CDBS Public Access (main) button at the bottom 
of the Electronic Filing and Public Access list section. The database 
searches return either station or application data. The application 
search provides an application link that displays the complete 
electronically filed application in application format. An AL/TC search 
under the application search link permits searching for Assignment of 
License/Transfer of Control groups using the AL/TC group lead 
application. For further details, click on the Help file.
    26. Potential bidders should direct questions regarding the search 
capabilities of CDBS to the Media Bureau help line at (202) 418-2662, 
or via e-mail at [email protected].
v. Bidder Alerts
    27. All applicants must certify on their FCC Form 175 applications 
under penalty of perjury that they are legally, technically, 
financially and otherwise qualified to hold a license, and not in 
default on any payment for Commission licenses (including down 
payments) or delinquent on any non-tax debt owed to any Federal agency. 
Prospective bidders are reminded that submission of a false 
certification to the Commission is a serious matter that may result in 
severe penalties, including monetary

[[Page 14644]]

forfeitures, license revocations, exclusion from participation in 
future auctions, and/or criminal prosecution.
    28. 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 and interested parties 
should perform their own due diligence before proceeding, as they would 
with any new business venture.
    29. As is the case with many business investment opportunities, 
some unscrupulous entrepreneurs may attempt to use Auction No. 49 to 
deceive and defraud unsuspecting investors. Common warning signals of 
fraud include the following:
    [sbull] The first contact is a ``cold call'' from a telemarketer, 
or is made in response to an inquiry prompted by a radio or television 
infomercial.
    [sbull] The offering materials used to invest in the venture appear 
to be targeted at IRA funds, for example, by including all documents 
and papers needed for the transfer of funds maintained in IRA accounts.
    [sbull] The amount of investment is less than $25,000.
    [sbull] The sales representative makes verbal representations that: 
(a) The Internal Revenue Service (``IRS''), Federal Trade Commission 
(``FTC''), Securities and Exchange Commission (``SEC''), FCC, or other 
government agency has approved the investment; (b) the investment is 
not subject to state or federal securities laws; or (c) the investment 
will yield unrealistically high short-term profits. In addition, the 
offering materials often include copies of actual FCC releases, or 
quotes from FCC personnel, giving the appearance of FCC knowledge or 
approval of the solicitation.
    30. Information about deceptive telemarketing investment schemes is 
available from the FTC at (202) 326-2222 and from the SEC at (202) 942-
7040. Complaints about specific deceptive telemarketing investment 
schemes should be directed to the FTC, the SEC, or the National Fraud 
Information Center at (800) 876-7060. Consumers who have concerns about 
specific proposals regarding Auction No. 49 may also call the FCC 
Consumer Center at (888) CALL-FCC ((888) 225-5322).
vi. National Environmental Policy Act (``NEPA'') Requirments
    31. Licensees must comply with the Commission's rules regarding the 
National Environmental Policy Act (NEPA). The construction of a 
wireless antenna facility is a federal action and the licensee must 
comply with the Commission's NEPA rules for each such facility. The 
Commission's NEPA rules require, among other things, that the licensee 
consult with expert agencies having NEPA responsibilities, including 
the U.S. Fish and Wildlife Service, the State Historic Preservation 
Office, the Army Corps of Engineers and the Federal Emergency 
Management Agency (through the local authority with jurisdiction over 
floodplains). The licensee must prepare environmental assessments for 
facilities that may have a significant impact in or on wilderness 
areas, wildlife preserves, threatened or endangered species or 
designated critical habitats, historical or archaeological sites, 
Indian religious sites, floodplains, and surface features. The licensee 
must also prepare environmental assessments for facilities that include 
high intensity white lights in residential neighborhoods or excessive 
radio frequency emission.

C. Auction Specifics

i. Auction Date
    32. The auction will begin on Wednesday, May 28, 2003. The initial 
schedule for bidding will be announced by public notice at least one 
week before the start of the auction. Unless otherwise announced, 
bidding on all licenses will be conducted on each business day until 
bidding has stopped on all licenses.
ii. Auction Title
    33. Auction No. 49--Lower 700 MHz Band
iii. Bidding Methodology
    34. The bidding methodology for Auction No. 49 will be simultaneous 
multiple round bidding. The Commission will conduct this auction over 
the Internet. Telephonic bidding will also be available, and the FCC 
Wide Area Network will be available as well. Qualified bidders are 
permitted to bid telephonically or electronically.
iv. Pre-Auction Dates and Deadlines
    35. Listed are important dates associated with Auction No. 49:

Auction Seminar--April 2, 2003
Short-Form (FCC Form 175) Filing Window Opens--April 2, 2003; 12 p.m. 
ET
Short-Form (FCC Form 175) Application Deadline--April 11, 2003; 6 p.m. 
ET
Upfront Payments (via wire transfer)--May 2, 2003; 6 p.m. ET
Mock Auction--May 22, 2003
Auction Begins--May 28, 2003
v. Requirements for Participation
    36. One commenter, Banks, requests that the Bureau limit 
eligibility in Auction No. 49 to parties that qualified to participate 
in Auction No. 44. Banks argues that such an eligibility limitation is 
mandated by the Auction Reform Act. Banks bases its argument on 
language from the Auction Reform Act, which limited the entities 
eligible to participate in Auction No. 44 to ``those entities that were 
qualified entities, and that submitted applications to participate in 
auction 44, by May 8, 2002, as part of the original auction 44 short 
form filing deadline.'' Banks contends that this restriction on 
eligibility applies to the spectrum blocks identified rather than a 
specific auction of those spectrum blocks. Thus, Banks concludes that 
the eligibility limitation extends to any subsequent auction of those 
same blocks of spectrum. Banks argues that the only other possible 
interpretation of the Auction Reform Act is that it does not permit 
further auctions of the C and D block spectrum until the Commission 
goes forward with the auction of the remainder of the 700 MHz spectrum. 
Only two commenters, Qualcomm and C&S, address Banks's assertion that 
the Auction Reform Act limits who is eligible to participate in Auction 
No. 49. Both Qualcomm and C&S oppose Banks's interpretation of the 
Auction Reform Act. As we explain, an analysis of the Auction Reform 
Act establishes that Banks's reading of the statute is incorrect.
    37. In the Auction Reform Act, among other things, Congress 
provided that the Commission not commence or conduct Auction No. 44 on 
June 19, 2002. In the following subsection, Congress indicated that 
this prohibition on conducting Auction No. 44 did not apply to the 
Lower 700 MHz C and D block licenses, established a restriction on the 
entities eligible to bid in the auction of these licenses, and 
established a deadline for the auction of such licenses and the deposit 
of the auction proceeds in the U.S. Treasury. A plain reading of these 
provisions shows that the limitations on who qualified to bid on the C 
block and the D block licenses only applied to the conduct of Auction 
No. 44 and not to any subsequent auction. The restriction on eligible 
bidders is contained in the

[[Page 14645]]

same subparagraph as other provisions regarding the timing of Auction 
No. 44, the conduct of Auction No. 44, and the deposit of the proceeds 
from Auction No. 44 in the U.S. Treasury. The timing provisions 
regarding the conduct of the auction and the deposit of the auction 
proceeds are significant because they indicate that Congress was only 
referring to one event, the conduct of Auction No. 44. Congress was not 
providing any instructions regarding the conduct of future auctions 
including the C and D block spectrum. Further, contrary to Banks's 
suggestion, nothing in the statute indicates that Congress was 
precluding in any manner a re-auction of the spectrum. Finally, Banks's 
interpretation of the Auction Reform Act is contrary to the statutory 
objectives of section 309(j) of the Communications Act. As Qualcomm 
notes in its comments, under Banks's interpretation of the Auction 
Reform Act, bidding on the licenses in Auction No. 49 would be limited 
to the same bidders that chose not to bid on the licenses when they 
were offered in Auction No. 44. This is unlikely to result in the 
licenses being awarded to the parties that value them most highly. 
Thus, absent explicit statutory language supporting Banks' 
interpretation, we decline to adopt the eligibility restrictions Banks 
suggests. Accordingly, any entity wishing to participate in the auction 
must:
    [sbull] Submit a short-form application (FCC Form 175) 
electronically by 6 p.m. ET, April 11, 2003.
    [sbull] Submit a sufficient upfront payment and an FCC Remittance 
Advice Form (FCC Form 159) by 6 p.m. ET, May 2, 2003.
    [sbull] Comply with all provisions outlined in this public notice.
vi. General Contact Information
    38. The following is a list of general contact information relating 
to Auction No. 49.

General Auction Information: General Auction Questions, Seminar 
Registration
    FCC Auctions Hotline, (888) 225-5322, Press Option 2 or 
direct (717) 338-2888, Hours of service: 8 a.m.-5:30 p.m. ET
Auction Legal Information: Auction Rules, Policies, Regulations
    Auctions and Industry Analysis Division, Legal Branch (202) 418-
0660
     Licensing Information: Rules, Policies, Regulations, Licensing 
Issues, Due Diligence, Incumbency Issues
    Commercial Wireless Division, (202) 418-0620.
Technical Support: Electronic Filing, FCC Automated Auction System
    FCC Auctions Technical Support Hotline, (202) 414-1250(Voice), 
(202) 414-1255 (TTY, Hours of service: Monday through Friday 8 a.m. to 
6 p.m. ET.
Payment Information: Wire Transfers, Refunds
    FCC Auctions Accounting Branch, (202) 418-0578 or (202) 418-0496, 
(202) 418-2843 (Fax)
Telephonic Bidding: Will be furnished only to qualified bidders
FCC Copy Contractor: Additional Copies of Commission Documents
    Qualex International, Portals II, 445 12th Street, SW, Room CY-
B402, Washington, DC 20554, (202) 863-2893, (202) 863-2898 (Fax), 
[email protected] (E-mail)
Press Information: Lauren Kravetz (202) 418-7944
FCC Forms: (800) 418-3676 (outside Washington, DC), (202) 418-3676 (in 
the Washington Area), http://www.fcc.gov/formpage.html
FCC Internet Sites:
    http://www.fcc.gov
    http://wireless.fcc.gov/auctions
    http://wireless.fcc.gov/uls

II. Short-Form (FCC Form 175) Application Requirements

    39. Guidelines for completion of the short-form (FCC Form 175) are 
set forth in Attachment D of the Auction No. 49 Procedures Public 
Notice. The short-form application seeks the applicant's name and 
address; legal classification; status; bidding credit eligibility; 
identification of the license(s) sought; and the authorized bidders and 
contact persons. All applicants must certify on their FCC Form 175 
applications under penalty of perjury that they are legally, 
technically, financially and otherwise qualified to hold a license and, 
as discussed in section II.E (Provisions Regarding Defaulters and 
Former Defaulters), that they are not in default on any payment for 
Commission licenses (including down payments) or delinquent on any non-
tax debt owed to any Federal agency.

A. License Selection

    40. In Auction No. 49, Form 175 will include a mechanism that 
allows an applicant to create customized lists of licenses. The 
applicant will make selections for one or more of the filter criteria 
and the system will produce a list of licenses satisfying the specified 
criteria. The applicant may apply for all the licenses in the 
customized list (by using the ``Save all filtered licenses'' option); 
select and save individual licenses separately from the list; or create 
a second customized list without selecting any of the licenses from the 
first list. Applicants also will be able to select licenses from one 
customized list and then create other customized lists to select 
additional licenses.

B. Ownership Disclosure Requirements (FCC Form 175 Exhibit A)

    41. All applicants must comply with the uniform part 1 ownership 
disclosure standards and provide information required by Sec. Sec.  
1.2105 and 1.2112 of the Commission's rules. Specifically, in 
completing FCC Form 175, applicants will be required to file an 
``Exhibit A'' providing a full and complete statement of the ownership 
of the bidding entity. The ownership disclosure standards for the 
short-form are set forth in Sec.  1.2112 of the Commission's rules.

C. Consortia and Joint Bidding Arrangements (FCC Form 175 Exhibit B)

    42. Applicants will be required to identify on their short-form 
applications any parties with whom they have entered into any 
consortium arrangements, joint ventures, partnerships or other 
agreements or understandings which relate in any way to the licenses 
being auctioned, including any agreements relating to post-auction 
market structure. Applicants will also be required to certify on their 
short-form applications that they have not entered into any explicit or 
implicit agreements, arrangements or understandings of any kind with 
any parties, other than those identified, regarding the amount of their 
bids, bidding strategies, or the particular licenses on which they will 
or will not bid. As discussed, if an applicant has had discussions, but 
has not reached a joint bidding agreement by the short-form deadline, 
it would not include the names of parties to the discussions on its 
applications and may not continue discussions with applicants for the 
same geographic license area(s) after the deadline. Where applicants 
have entered into consortia or joint bidding arrangements, applicants 
must submit an ``Exhibit B'' to the FCC Form 175.
    43. A party holding a non-controlling, attributable interest in one 
applicant will be permitted to acquire an ownership interest in, form a 
consortium with, or enter into a joint bidding arrangement with other 
applicants for licenses in the same geographic license area provided 
that (i) the attributable interest holder certifies that it has not and 
will not communicate with any party concerning the bids or bidding 
strategies of more than one of the applicants in which it holds an 
attributable interest, or with

[[Page 14646]]

which it has formed a consortium or entered into a joint bidding 
arrangement; and (ii) the arrangements do not result in a change in 
control of any of the applicants. While the anti-collusion rules do not 
prohibit non-auction related business negotiations among auction 
applicants, bidders are reminded that certain discussions or exchanges 
could touch upon impermissible subject matters because they may convey 
pricing information and bidding strategies.

D. Eligibility

i. Bidding Credit Eligibility (FCC Form 175 Exhibit C)
    44. A bidding credit represents the amount by which a bidder's 
winning bids are discounted. The size of the bidding credit depends on 
the average of the aggregated annual gross revenues for each of the 
preceding three years of the bidder, its affiliates, its controlling 
interests, and the affiliates of its controlling interests.
    45. In the Lower 700 MHz Report & Order, the Commission determined 
that three levels of bidding credits were appropriate for the MSA/RSA 
licenses in the C block and that the licenses in the D block would be 
limited to two levels of bidding credits. Aloha and Cavalier urge that 
the Commission apply three levels of bidding credits to the EAG 
licenses in the D block. Because the bidding credit levels were adopted 
by the Commission in its Lower 700 MHz band proceeding, they were not a 
matter upon which the Bureau sought comment. Accordingly, for Auction 
No. 49, bidding credits will be available to small and very small 
businesses and entrepreneurs, or consortia thereof, as defined in 47 
CFR 27.702 for the Lower 700 MHz band licenses:
    [sbull] A bidder with attributed average annual gross revenues of 
not more than $40 million for the preceding three years (``small 
business'') receives a 15 percent discount on its winning bids for 
Lower 700 MHz band licenses;
    [sbull] A bidder with attributed average annual gross revenues of 
not more than $15 million for the preceding three years (``very small 
business'') receives a 25 percent discount on its winning bids for 
Lower 700 MHz band licenses;
    [sbull] A bidder with attributed average annual gross revenues of 
not more than $3 million for the preceding three years 
(``entrepreneur'') receives a 35 percent discount on its winning bids 
for the MSA/RSA licenses in the Lower 700 MHz band. This definition 
applies only with respect to licenses in Block C (710-716 MHz and 740-
746 MHz) as specified in 47 CFR 27.5(c)(1).
    46. A bidder that qualifies as an entrepreneur may bid on EAG 
licenses in Block D, but will only receive a 25 percent bidding credit 
on any EAG license that it wins. Bidding credits are not cumulative; a 
qualifying applicant receives either the 15 percent, 25 percent, or 35 
percent bidding credit on its winning bid, but only one credit per 
license.
ii. Tribal Land Bidding Credit
    47. To encourage the growth of wireless services in federally 
recognized tribal lands the Commission has implemented a tribal land 
bidding credit. See section V.E. of the Auction No. 49 Procedures 
Public Notice.
iii. Applicability of Part 1 Attribution Rules
    48. Controlling interest standard. On August 14, 2000, the 
Commission released the Part 1 Fifth Report and Order, in which the 
Commission, inter alia, adopted a ``controlling interest'' standard for 
attributing to auction applicants the gross revenues of their investors 
and affiliates in determining small business eligibility for future 
auctions. The Commission observed that the rule modifications adopted 
in the various Part 1 orders would result in discrepancies and/or 
redundancies between certain of the new Part 1 rules and existing 
service-specific rules, and the Commission delegated to the Bureau the 
authority to make conforming edits to the Code of Federal Regulations 
(CFR) consistent with the rules adopted in the Part 1 proceeding. Part 
1 rules that superseded inconsistent service-specific rules will 
control in Auction No. 49. Accordingly, the ``controlling interest'' 
standard as set forth in the part 1 rules will be in effect for Auction 
No. 49.
    49. Control. The term ``control'' includes both de facto and de 
jure control of the applicant. Typically, ownership of at least 50.1 
percent of an entity's voting stock evidences de jure control. De facto 
control is determined on a case-by-case basis. The following are some 
common indicia of de facto control:
    [sbull] The entity constitutes or appoints more than 50 percent of 
the board of directors or management committee;
    [sbull] The entity has authority to appoint, promote, demote, and 
fire senior executives that control the day-to-day activities of the 
licensee; or
    [sbull] The entity plays an integral role in management decisions.
    50. Attribution for small, very small business and entrepreneur 
eligibility. In determining which entities qualify as small, very small 
businesses or entrepreneurs, the Commission will consider the gross 
revenues of the applicant, its affiliates, its controlling interests, 
and the affiliates of its controlling interests. The Commission does 
not impose specific equity requirements on controlling interest 
holders. Once the principals or entities with a controlling interest 
are determined, only the revenues of those principals or entities, the 
affiliates of those principals or entities, the applicant and its 
affiliates, will be counted in determining small business eligibility.
    51. A consortium of small businesses, very small businesses or 
entrepreneurs is a ``conglomerate organization formed as a joint 
venture between or among mutually independent business firms,'' each of 
which individually must satisfy the definition of small business, very 
small business or entrepreneur in Sec. Sec.  1.2110(f), 27.702. Thus, 
each consortium member must disclose its gross revenues along with 
those of its affiliates, its controlling interests, and the affiliates 
of its controlling interests. We note that although the gross revenues 
of the consortium members will not be aggregated for purposes of 
determining eligibility for small business, very small business or 
entrepreneur credits, this information must be provided to ensure that 
each individual consortium member qualifies for any bidding credit 
awarded to the consortium.
iv. Supporting Documentation
    52. Applicants should note that they will be required to file 
supporting documentation to their FCC Form 175 short-form applications 
to establish that they satisfy the eligibility requirements to qualify 
as small, very small businesses or entrepreneurs (or consortia of 
small, very small businesses or entrepreneurs) for this auction.
    53. Applicants should further note that submission of an FCC Form 
175 application constitutes a representation by the certifying official 
that he or she is an authorized representative of the applicant, has 
read the form's instructions and certifications, and that the contents 
of the application 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.
    54. Small business, very small business, or entrepreneur 
eligibility (Exhibit C). Entities applying to bid as small or very 
small businesses or

[[Page 14647]]

entrepreneurs (or consortia of small or very small businesses or 
entrepreneurs) will be required to disclose on Exhibit C to their FCC 
Form 175 short-form applications, separately and in the aggregate, the 
gross revenues for the preceding three years of each of the following: 
(i) The applicant, (ii) Its affiliates, (iii) its controlling 
interests, and (iv) the affiliates of its controlling interests. 
Certification that the average annual gross revenues for the preceding 
three years do not exceed the applicable limit is not sufficient. A 
statement of the total gross revenues for the preceding three years is 
also insufficient. The applicant must provide separately for itself, 
its affiliates, its controlling interests, and the affiliates of its 
controlling interests, a schedule of gross revenues for each of the 
preceding three years, as well as a statement of total average gross 
revenues for the three-year period. If the applicant is applying as a 
consortium of small, very small businesses or entrepreneurs, this 
information must be provided for each consortium member.

E. Provisions Regarding Defaulters and Former Defaulters (FCC Form 175 
Exhibit D)

    55. Each applicant must certify on its FCC Form 175 application 
that it is not in default on any Commission licenses and that it is not 
delinquent on any non-tax debt owed to any Federal agency. In addition, 
each applicant must attach to its FCC Form 175 application a statement 
made under penalty of perjury indicating whether or not the applicant, 
its affiliates, its controlling interests, or the affiliates of its 
controlling interest have ever been in default on any Commission 
licenses or have ever been delinquent on any non-tax debt owed to any 
Federal agency. The applicant must provide such information for itself, 
its affiliates, its controlling interests, and the affiliates of its 
controlling interests, as defined by Sec.  1.2110 of the Commission's 
rules (as amended in the Part 1 Fifth Report and Order). Applicants 
must include this statement as Exhibit D of the FCC Form 175. 
Prospective bidders are reminded that the statement must be made under 
penalty of perjury and, further, submission of a false certification to 
the Commission is a serious matter that may result in severe penalties, 
including monetary forfeitures, license revocations, exclusion from 
participation in future auctions, and/or criminal prosecution.
    56. ``Former defaulters''--i.e., applicants, including their 
attributable interest holders, that in the past have defaulted on any 
Commission licenses or been delinquent on any non-tax debt owed to any 
Federal agency, but that have since remedied all such defaults and 
cured all of their outstanding non-tax delinquencies--are eligible to 
bid in Auction No. 49, provided that they are otherwise qualified. 
However, as discussed infra in section III.D.iii, former defaulters are 
required to pay upfront payments that are fifty percent more than the 
normal upfront payment amounts.

F. Installment Payments

    57. Installment payment plans will not be available in Auction No. 
49.

G. Other Information (FCC Form 175 Exhibits E and F)

    58. Applicants owned by minorities or women, as defined in 47 CFR 
1.2110(c)(2), may attach an exhibit (Exhibit E) regarding this status. 
This applicant status information is collected for statistical purposes 
only and assists the Commission in monitoring the participation of 
``designated entities'' in its auctions. Applicants wishing to submit 
additional information may do so on Exhibit F (Miscellaneous 
Information) to the FCC Form 175.

H. Minor Modifications to Short-Form Applications (FCC Form 175)

    59. After the short-form filing deadline (April 11, 2003), 
applicants may make only minor changes to their FCC Form 175 
applications. Applicants will not be permitted to make major 
modifications to their applications (e.g., change their license 
selections or proposed service areas, change the certifying official or 
change control of the applicant or change bidding credits). See 47 CFR 
1.2105. Permissible minor changes include, for example, deletion and 
addition of authorized bidders (to a maximum of three) and revision of 
exhibits. Applicants should make these modifications to their FCC Form 
175 electronically and submit a letter, briefly summarizing the 
changes, by electronic mail to the attention of Margaret Wiener, Chief, 
Auctions and Industry Analysis Division, at the following address: 
[email protected]. The electronic mail summarizing the changes must 
include a subject or caption referring to Auction No. 49. The Bureau 
requests that parties format any attachments to electronic mail as 
Adobe[reg] Acrobat[reg] (pdf) or Microsoft[reg] Word documents.
    60. A separate copy of the letter should be faxed to the attention 
of Kathryn Garland at (717) 338-2850. Questions about other changes 
should be directed to Howard Davenport of the Auctions and Industry 
Analysis Division at (202) 418-0660.

I. Maintaining Current Information in Short-Form Applications (FCC Form 
175)

    61. Applicants have an obligation under 47 CFR 1.65, to maintain 
the completeness and accuracy of information in their short-form 
applications. Amendments reporting substantial changes of possible 
decisional significance in information contained in FCC Form 175 
applications, as defined by 47 CFR 1.2105(b)(2), will not be accepted 
and may in some instances result in the dismissal of the FCC Form 175 
application.

III. Pre-Auction Procedures

A. Auction Seminar

    62. On Wednesday, April 2, 2003, the FCC will sponsor a free 
seminar for Auction No. 49 at the Federal Communications Commission, 
located at 445 12th Street, SW., Washington, DC. The seminar will 
provide attendees with information about pre-auction procedures, 
conduct of the auction, the FCC Automated Auction System, and the lower 
700 MHz and auction rules. The seminar will also provide an opportunity 
for prospective bidders to ask questions of FCC staff.
    63. To register, complete the registration form in Attachment B, of 
the Auction No. 49 Procedures Public Notice, and submit it by Friday, 
March 28, 2003. Registrations are accepted on a first-come, first-
served basis.

B. Short-Form Applications (FCC Form 175)--Due April 11, 2003

    64. In order to be eligible to bid in this auction, applicants must 
first submit an FCC Form 175 application. This application must be 
submitted electronically and received at the Commission no later than 
6:00 p.m. ET on April 11, 2003. Late applications will not be accepted.
    65. There is no application fee required when filing an FCC Form 
175. However, to be eligible to bid, an applicant must submit an 
upfront payment. See section III.D.
i. Electronic Filing
    66. Applicants must file their FCC Form 175 applications 
electronically. Applications may generally be filed at any time 
beginning at noon ET on April 2, 2003, until 6:00 p.m. ET on April 11, 
2003. Applicants are strongly encouraged to file early and are 
responsible for allowing adequate time for filing their applications. 
Applicants may update or amend their electronic

[[Page 14648]]

applications multiple times until the filing deadline on April 11, 
2003.
    67. Applicants must press the ``SUBMIT Application'' button on the 
``Submission'' page of the electronic form to successfully submit their 
FCC Form 175s. Any form that is not submitted will not be reviewed by 
the FCC. Information about accessing the FCC Form 175 is included in 
Attachment C of the Auction No. 49 Procedures Public Notice. Technical 
support is available at (202) 414-1250 (voice) or (202) 414-1255 (text 
telephone (TTY)); hours of service Monday through Friday, from 8:00 AM 
to 6:00 PM ET. In order to provide better service to the public, all 
calls to the hotline are recorded.
    68. Applicants can also contact Technical Support via e-mail. To 
obtain the address, click the Support tab on the Form 175 Homepage.
ii. Completion of the FCC Form 175
    69. Applicants should carefully review 47 CFR 1.2105, and must 
complete all items on the FCC Form 175. Instructions for completing the 
FCC Form 175 are in Attachment D of the Auction No. 49 Procedures 
Public Notice. Applicants are encouraged to begin preparing the 
required attachments for FCC Form 175 prior to submitting the form. 
Attachments C and D to the Auction No. 49 Procedures Public Notice 
provide information on the required attachments and appropriate 
formats.
iii. Electronic Review of FCC Form 175
    70. The FCC Form 175 electronic review system may be used to locate 
and print applicants' FCC Form 175 information. There is no fee for 
accessing this system. See Attachment C of the Auction No. 49 
Procedures Public Notice for details on accessing the review system.
    71. Applicants may also view other applicants' completed FCC Form 
175s after the filing deadline has passed and the FCC has issued a 
public notice explaining the status of the applications. Note: 
Applicants should not include sensitive information (i.e., TIN/EIN) on 
any exhibits to their FCC Form 175 applications.

C. Application Processing and Minor Corrections

    72. After the deadline for filing the FCC Form 175 applications has 
passed, the FCC will process all timely submitted applications to 
determine which are acceptable for filing, and subsequently will issue 
a public notice identifying: (i) Those applications accepted for 
filing; (ii) those applications rejected; and (iii) those applications 
which have minor defects that may be corrected, and the deadline for 
filing such corrected applications.
    73. As described more fully in the Commission's rules, after the 
April 11, 2003, short-form filing deadline, applicants may make only 
minor corrections to their FCC Form 175 applications. Applicants will 
not be permitted to make major modifications to their applications 
(e.g., change their license selections, change the certifying official, 
change control of the applicant, or change bidding credit eligibility).

D. Upfront Payments--Due May 2, 2003

    74. In order to be eligible to bid in the auction, applicants must 
submit an upfront payment accompanied by an FCC Remittance Advice Form 
(FCC Form 159). After completing the FCC Form 175, filers will have 
access to an electronic version of the FCC Form 159 that can be printed 
and faxed to Mellon Bank in Pittsburgh, PA. All upfront payments must 
be received at Mellon Bank by 6:00 p.m. ET on May 2, 2003.
    75. Please note that:
    [sbull] All payments must be made in U.S. dollars.
    [sbull] All payments must be made by wire transfer.
    [sbull] Upfront payments for Auction No. 49 go to a lockbox number 
different from the lockboxes used in previous FCC auctions, and 
different from the lockbox number to be used for post-auction payments.
    [sbull] Failure to deliver the upfront payment by the May 2, 2003, 
deadline will result in dismissal of the application and 
disqualification from participation in the auction.
i. Making Auction Payments by Wire Transfer
    76. Wire transfer payments must be received by 6 p.m. ET on May 2, 
2003. To avoid untimely payments, applicants should discuss 
arrangements (including bank closing schedules) with their banker 
several days before they plan to make the wire transfer, and allow 
sufficient time for the transfer to be initiated and completed before 
the deadline. Applicants will need the following information:

ABA Routing Number: 043000261.
Receiving Bank: Mellon Pittsburgh.
Beneficiary: FCC/Account  910-1203.
OBI Field: (Skip one space between each information item) 
``Auctionpay''
FCC Registration Number (FRN): (same as FCC Form 159, block 11 and/or 
21)
Payment Type Code: (same as FCC Form 159, block 24A: A49U)
FCC Code 1: (same as FCC Form 159, block 28A: ``49'')
Payer Name: (same as FCC Form 159, block 2)
Lockbox No.:  358425


    Note: The BNF and Lockbox number are specific to the upfront 
payments for this auction; do not use BNF or Lockbox numbers from 
previous auctions.

    77. Applicants must fax a completed FCC Form 159 (Revised 2/00) to 
Mellon Bank at (412) 209-6045 at least one hour before placing the 
order for the wire transfer (but on the same business day). On the 
cover sheet of the fax, write ``Wire Transfer--Auction Payment for 
Auction Event No. 49.'' Bidders should confirm receipt of their upfront 
payment at Mellon Bank by contacting their sending financial 
institution.
ii. FCC Form 175
    78. A completed FCC Remittance Advice Form (FCC Form 159, Revised 
2/00) must be faxed to Mellon Bank in order to accompany each upfront 
payment. Proper completion of FCC Form 159 (Revised 2/00) is critical 
to ensuring correct credit of upfront payments. Detailed instructions 
for completion of FCC Form 159 are included in Attachment E of the 
Auction No. 49 Procedures Public Notice. An electronic version of the 
FCC Form 159 is available after filing the FCC Form 175. The FCC Form 
159 can be completed electronically, but must be filed with Mellon Bank 
via facsimile.
iii. Amount of Upfront Payment
    79. In the Part 1 Order, 62 FR 13540 (March 21, 1997), the 
Commission delegated to the Bureau the authority and discretion to 
determine appropriate upfront payment(s) for each auction. In addition, 
in the Part 1 Fifth Report and Order, the Commission ordered that 
``former defaulters,'' i.e., applicants that have ever been in default 
on any Commission license or have ever been delinquent on any non-tax 
debt owed to any Federal agency, be required to pay upfront payments 
fifty percent greater than non-``former defaulters.'' For purposes of 
this calculation, the ``applicant'' includes the applicant itself, its 
affiliates, its controlling interests, and affiliates of its 
controlling interests, as defined by Sec.  1.2110 of the Commission's 
rules (as amended in the Part 1 Fifth Report and Order).
    80. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice we proposed that the amount of the 
upfront payment would determine the number of bidding units on which a 
bidder may place bids. In order to bid on a license, otherwise 
qualified bidders that applied for that license on Form 175 must have

[[Page 14649]]

an eligibility level that meets or exceeds the number of bidding units 
assigned to that license. At a minimum, therefore, an applicant's total 
upfront payment must be enough to establish eligibility to bid on at 
least one of the licenses applied for on Form 175, or else the 
applicant will not be eligible to participate in the auction. An 
applicant does not have to make an upfront payment to cover all 
licenses for which the applicant has applied on Form 175, but rather to 
cover the maximum number of bidding units that are associated with 
licenses on which the bidder wishes to place bids and hold high bids at 
any given time.
    81. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed upfront payments on 
a license-by-license basis using the following formula:

$0.005 * MHz * License Area Population with a minimum of $1,000 per 
license.

    82. The Bureau received two comments on this issue. Aloha and 
Cavalier support the Bureau's proposal. Accordingly, the Bureau adopts 
its proposed formula for determining upfront payments.
    83. The specific upfront payments and bidding units for each 
license are set forth in Attachment A of the Auction No. 49 Procedures 
Public Notice.
    84. In calculating its upfront payment amount, an applicant should 
determine the maximum number of bidding units on which it may wish to 
be active (bidding units associated with licenses on which the bidder 
has the standing high bid from the previous round and licenses on which 
the bidder places a bid in the current round) in any single round, and 
submit an upfront payment covering that number of bidding units. In 
order to make this calculation, an applicant should add together the 
upfront payments for all licenses on which it seeks to bid in any given 
round. Bidders should check their calculations carefully, as there is 
no provision for increasing a bidder's maximum eligibility after the 
upfront payment deadline.

                                Example: Upfront Payments and Bidding Flexibility
----------------------------------------------------------------------------------------------------------------
                                                                                                      Upfront
           Market No.               Block         Market name       Population     Bidding units      payment
----------------------------------------------------------------------------------------------------------------
CMA152.........................  C            Portland, ME......         300,826          18,000         $18,000
CMA314.........................  C            Alabama 8--Lee....         196,259          12,000         12,000
----------------------------------------------------------------------------------------------------------------
If a bidder wishes to bid on both licenses in a round, it must have selected both on its FCC Form 175 and
  purchased at least 30,000 bidding units (18,000 + 12,000). If a bidder only wishes to bid on one, but not
  both, purchasing 18,000 bidding units would meet the requirement for either license. The bidder would be able
  to bid on either license, but not both at the same time. If the bidder purchased only 12,000 bidding units, it
  would have enough eligibility for the Alabama 8--Lee license but not for the Portland, ME license.

    85. Former defaulters should calculate their upfront payment for 
all licenses by multiplying the number of bidding units they wish to 
purchase by 1.5. In order to calculate the number of bidding units to 
assign to former defaulters, the Commission will divide the upfront 
payment received by 1.5 and round the result up to the nearest bidding 
unit.
    86. Note: An applicant may, on its FCC Form 175, apply for every 
applicable license being offered, but its actual bidding in any round 
will be limited by the bidding units reflected in its upfront payment.
iv. Applicant's Wire Transfer Information for Purposes of Refunds of 
Upfront Payments
    87. The Commission will use wire transfers for all Auction No. 49 
refunds. To ensure that refunds of upfront payments are processed in an 
expeditious manner, the Commission is requesting that all pertinent 
information as listed be supplied to the FCC. Applicants can provide 
the information electronically during the initial short-form filing 
window after the form has been submitted. Wire Transfer Instructions 
can also be manually faxed to the FCC, Financial Operations Center, 
Auctions Accounting Group, Attn: Gail Glasser or Tim Dates, at (202) 
418-2843 by May 2, 2003. All refunds will be returned to the payer of 
record as identified on the FCC Form 159 unless the payer submits 
written authorization instructing otherwise. For additional 
information, please call Gail Glasser at (202) 418-0578 or Tim Dates at 
(202) 418-0496.

Name of Bank
ABA Number
Contact and Phone Number
Account Number to Credit
Name of Account Holder
FCC Registration Number (FRN)
Taxpayer Identification Number
Correspondent Bank (if applicable)
ABA Number
Account Number

(Applicants should also note that implementation of the Debt Collection 
Improvement Act of 1996 requires the FCC to obtain a Taxpayer 
Identification Number (TIN) before it can disburse refunds.)
    Eligibility for refunds is discussed in section V.G.

E. Auction Registration

    88. Approximately ten days before the auction, the FCC will issue a 
public notice announcing all qualified bidders for the auction. 
Qualified bidders are those applicants whose FCC Form 175 applications 
have been accepted for filing and have timely submitted upfront 
payments sufficient to make them eligible to bid on at least one of the 
licenses for which they applied.
    89. All qualified bidders are automatically registered for the 
auction. Registration materials will be distributed prior to the 
auction by two separate overnight mailings, one containing the 
confidential bidder identification number (BIN) and the other 
containing the SecurID cards, both of which are required to place bids. 
These mailings will be sent only to the contact person at the contact 
address listed in the FCC Form 175.
    90. Applicants that do not receive both registration mailings will 
not be able to submit bids. Therefore, any qualified applicant that has 
not received both mailings by noon on Tuesday, May 20, 2003, should 
contact the Auctions Hotline at (717) 338-2888. Receipt of both 
registration mailings is critical to participating in the auction, and 
each applicant is responsible for ensuring it has received all of the 
registration material.
    91. Qualified bidders should note that lost bidder identification 
numbers or SecurID cards can be replaced only by appearing in person at 
the FCC headquarters, located at 445 12th St., SW, Washington, DC 
20554. Only an authorized representative or certifying official, as 
designated on an applicant's FCC Form 175, may appear in person with 
two forms of identification (one of which must be a photo 
identification) in order to receive replacements. Qualified bidders 
requiring replacements must call technical support prior to arriving at 
the FCC.

[[Page 14650]]

F. Remote Electronic Bidding

    92. The Commission will conduct this auction over the Internet. 
Telephonic bidding will also be available, and the FCC Wide Area 
Network will be available as well. Qualified bidders are permitted to 
bid telephonically or electronically, i.e., over the Internet or the 
FCC's Wide Area Network. In either case, each authorized bidder must 
have its own SecurID card, which the FCC will provide at no charge. 
Each applicant with one authorized bidder will be issued two SecurID 
cards, while applicants with two or three authorized bidders will be 
issued three cards. For security purposes, the SecurID cards and the 
FCC Automated Auction System user manual are only mailed to the contact 
person at the contact address listed on the FCC Form 175. Please note 
that each SecurID card is tailored to a specific auction; therefore, 
SecurID cards issued for other auctions or obtained from a source other 
than the FCC will not work for Auction No. 49. The telephonic bidding 
phone number will be supplied in the first overnight mailing, which 
also includes the confidential bidder identification number. Each 
applicant should indicate its bidding preference--electronic or 
telephonic--on the FCC Form 175.
    93. Please note that the SecurID cards can be recycled, and we 
encourage bidders to return the cards to the FCC. We will provide pre-
addressed envelopes that bidders may use to return the cards once the 
auction is over.

G. Mock Auction

    94. All qualified bidders will be eligible to participate in a mock 
auction on Thursday, May 22, 2003. The mock auction will enable 
applicants to become familiar with the FCC Automated Auction System 
prior to the auction. Participation by all bidders is strongly 
recommended. Details will be announced by public notice.

IV. Auction Event

    95. The first round of bidding for Auction No. 49 will begin on 
Wednesday, May 28, 2003. The initial bidding schedule will be announced 
in a public notice listing the qualified bidders, which is released 
approximately 10 days before the start of the auction.

A. Auction Structure

i. Simultaneous Multiple Round Auction
    96. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, we proposed to award all licenses in 
Auction No. 49 in a simultaneous multiple round auction. Aloha and 
Cavalier agree with the Bureau's proposal. We conclude that it is 
operationally feasible and appropriate to auction the licenses in the 
Lower 700 MHz band through a simultaneous multiple round auction. 
Unless otherwise announced, bids will be accepted on all licenses in 
each round of the auction. This approach, we believe, allows bidders to 
take advantage of synergies that exist among licenses and is 
administratively efficient.
ii. Maximum Eligibility and Activity Rules
    97. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed that the amount of 
the upfront payment submitted by a bidder would determine the initial 
maximum eligibility (as measured in bidding units) for each bidder. One 
commenter, Banks, requests that the Bureau modify, or create an 
exception, to this procedure in conjunction with adopting new 
procedures that would apply when a high bidder withdraws its bid during 
the course of the auction. Specifically, Banks suggests that in Auction 
No. 49, when a bidder withdraws its standing high bid, the next-highest 
bidder should be offered the licenses at its last bid amount, 
regardless of whether the next-highest bidder has any bidding 
eligibility available or is even still in the auction. In support of 
its proposal, Banks claims that adoption of this procedure will ensure 
that the party that values the license most highly wins the license. As 
the Bureau explains, it declines to adopt Banks' proposal because it 
would undermine the efficacy of the Bureau's activity and eligibility 
rules, thereby potentially decreasing the likelihood that the license 
is awarded to the bidder who values it most highly.
    98. The Commission's rules do not provide for the procedure 
suggested by Banks. Pursuant to Sec.  1.2109(b) of the Commission's 
rules, however, the Bureau retains the discretion to offer licenses to 
the next-highest bidder if a winning bidder withdraws or defaults 
``after the Commission has declared competitive bidding closed.'' 
Although the Bureau has the discretion to award licenses to the next-
highest bidder in such cases, the Commission has consistently 
indicated, ``the best course is to re-auction the license.'' The 
Commission has also recognized that the circumstances for which a next-
highest offer would be appropriate are narrow. Further, the Commission 
has observed that re-offering a defaulted license to the next highest 
bidder ``may not ensure that the license will be offered to the bidder 
who values it most highly. In particular, as the license is offered to 
bidders at that next highest bids, other parties can argue that they 
would pay more for the license if given the opportunity.'' Thus, even 
where the rules provide for a procedure similar to the one suggested by 
Banks, it is generally disfavored.
    99. Perhaps more significantly, Banks's proposal also implicates 
the activity and eligibility rules that apply to the conduct of the 
Commission's simultaneous multiple round auctions. A bidder's 
eligibility at the start of an auction is based upon the upfront 
payment amount that is converted into bidding units, using an auction-
specific dollar to bidding unit ratio. Through the upfront payment, the 
applicant may purchase as many bidding units as it desires, but it must 
have sufficient bidding units to be eligible to bid on at least one of 
the licenses that it selects on the FCC Form 175 (``short-form 
application''). The activity rules, in turn, require bidder 
participation throughout the auction. Each bidder must have bidding 
activity in each round that accounts for a specified fraction of the 
bidder's current eligibility, as measured in bidding units. Once 
eligibility has been reduced, a bidder will not be permitted to regain 
its lost bidding eligibility.
    100. The activity and eligibility rules serve several important 
functions that are necessary to an efficient auction process. The 
auction activity and eligibility rules encourage bidders to make early 
bids in the auction, as opposed to waiting until later rounds to 
participate. Prompt and early participation by a bidder in the auction 
reveals useful information to other bidders about its demand and 
valuations for licenses. This transparent process allows bidders to 
modify their strategies based on current prices. The activity and 
eligibility rules also help maintain the pace of the auction, which 
reduces costs to bidders and the Commission. By promoting an efficient 
auction process, these rules increase the likelihood that the winning 
bidder will be the party that most highly values the license. By 
circumventing the activity and eligibility rules, Banks' proposal to 
restore eligibility would undermine this efficiency.
    101. Furthermore, in contrast with one of the basic principles of 
our auction design, Banks' proposal would permit the withdrawal of one 
bidder to directly affect the auction outcome for another bidder by 
means other than

[[Page 14651]]

straightforwardly outbidding it. In essence, this change would allow 
the withdrawing bidder to turn a license over to the holder of the 
second-highest bid, without the second highest bidder having to outbid 
the other bidders who might have an interest in the license. This would 
create the potential for anti-competitive strategic interaction among 
auction participants and abuse of the auction rules. Finally, Banks' 
proposal does not address whether the eligibility of other bidders, 
that may also have an interest, should also be restored and at what 
level to allow them to bid for the license. Instead, Banks' proposal 
makes a questionable assumption that the next highest bidder is the 
only bidder who would at that stage be interested in submitting a bid. 
Thus, Banks' proposal does not appear to increase the likelihood that 
the winning bidder will be the party that most highly values the 
license.
    102. Accordingly, the Bureau rejects Banks' request and adopts its 
proposal that the amount of the upfront payment submitted by a bidder 
determines the maximum initial eligibility (in bidding units) for each 
bidder. Note again that each license is assigned a specific number of 
bidding units equal to the upfront payment listed in Attachment A of 
the Auction No. 49 Procedures Public Notice on a bidding unit per 
dollar basis. The total upfront payment defines the maximum number of 
bidding units on which the applicant will be permitted to bid and hold 
high bids in a round. As there is no provision for increasing a 
bidder's eligibility after the upfront payment deadline, prospective 
bidders are cautioned to calculate their upfront payments carefully. 
The total upfront payment does not affect the total dollar amount a 
bidder may bid on any given license.
    103. In order to ensure that the auction closes within a reasonable 
period of time, an activity rule requires bidders to bid actively 
throughout the auction, rather than wait until late in the auction 
before participating. Bidders are required to be active on a specific 
percentage of their current eligibility during each round of the 
auction.
    104. A bidder's activity level in a round is the sum of the bidding 
units associated with licenses on which the bidder is active. A bidder 
is considered active on a license in the current round if it is either 
the high bidder at the end of the previous bidding round and does not 
withdraw the high bid in the current round, or if it submits a bid in 
the current round (see ``Bid Increments and Minimum Accepted Bids'' in 
section IV.B.iii). The minimum required activity is expressed as a 
percentage of the bidder's current bidding eligibility, and increases 
by stage as the auction progresses. Because these procedures have 
proven successful in maintaining the pace of previous auctions (as set 
forth under ``Auction Stages'' in section IV.A.iii and ``Stage 
Transitions'' in section IV.A.iv), we adopt them for Auction No. 49.
iii. Auction Stages
    105. In the Auction No. 49 Comment Public Notice and Auction No.49 
Revised Comment Public Notice, the Bureau proposed to conduct the 
auction in three stages and employ an activity rule. The Bureau further 
proposed that, in each round of Stage One, a bidder desiring to 
maintain its current eligibility would be required to be active on 
licenses encompassing at least 80 percent of its current bidding 
eligibility. In each round of Stage Two, a bidder desiring to maintain 
its current eligibility would be required to be active on at least 90 
percent of its current bidding eligibility. Finally, the Bureau 
proposed that a bidder in Stage Three, in order to maintain its current 
eligibility, would be required to be active on 98 percent of its 
current bidding eligibility. The Bureau received no comments on this 
proposal.
    106. The Bureau adopts its proposals for the activity rule and 
stages. Listed are the activity levels for each stage of the auction. 
The FCC reserves the discretion to further alter the activity 
percentages before and/or during the auction.
    Stage One: During the first stage of the auction, a bidder desiring 
to maintain its current eligibility will be required to be active on 
licenses encompassing at least 80 percent of its current bidding 
eligibility in each bidding round. Failure to maintain the required 
activity level will result in a reduction in the bidder's bidding 
eligibility in the next round of bidding (unless an activity rule 
waiver is used). During Stage One, reduced eligibility for the next 
round will be calculated by multiplying the bidder's current activity 
(the sum of bidding units of the bidder's standing high bids and bids 
during the current round) by five-fourths (5/4).
    Stage Two: During the second stage of the auction, a bidder 
desiring to maintain its current eligibility is required to be active 
on 90 percent of its current bidding eligibility. Failure to maintain 
the required activity level will result in a reduction in the bidder's 
bidding eligibility in the next round of bidding (unless an activity 
rule waiver is used). During Stage Two, reduced eligibility for the 
next round will be calculated by multiplying the bidder's current 
activity (the sum of bidding units of the bidder's standing high bids 
and bids during the current round) by ten-ninths (10/9).
    Stage Three: During the third stage of the auction, a bidder 
desiring to maintain its current eligibility is required to be active 
on 98 percent of its current bidding eligibility. Failure to maintain 
the required activity level will result in a reduction in the bidder's 
bidding eligibility in the next round of bidding (unless an activity 
rule waiver is used). In this final stage, reduced eligibility for the 
next round will be calculated by multiplying the bidder's current 
activity (the sum of bidding units of the bidder's standing high bids 
and bids during the current round) by fifty-fortyninths (50/49).
    Caution: Since activity requirements increase in each auction 
stage, bidders must carefully check their current activity during the 
bidding period of the first round following a stage transition. This is 
especially critical for bidders that have standing high bids and do not 
plan to submit new bids. In past auctions, some bidders have 
inadvertently lost bidding eligibility or used an activity rule waiver 
because they did not re-verify their activity status at stage 
transitions. Bidders may check their activity against the required 
activity level by using the bidding system's bidding module.
    107. Because the foregoing procedures have proven successful in 
maintaining proper pace in previous auctions, the Bureau adopts them 
for Auction No. 49.
iv. Stage Transitions
    108. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed that the auction 
would generally advance to the next stage (i.e., from Stage One to 
Stage Two, and from Stage Two to Stage Three) when the auction activity 
level, as measured by the percentage of bidding units receiving new 
high bids, is below 20 percent for three consecutive rounds of bidding 
in each Stage. The Bureau further proposed that it would retain the 
discretion to change stages unilaterally by announcement during the 
auction. This determination, the Bureau proposed, would be based on a 
variety of measures of bidder activity, including, but not limited to, 
the auction activity level, the percentages of licenses (as measured in 
bidding units) on which there are new bids, the number of new bids, and 
the percentage increase in revenue. The Bureau received no comments on 
this subject.
    109. The Bureau adopts its proposal. Thus, the auction will start 
in Stage One

[[Page 14652]]

and will generally advance to the next stage (i.e., from Stage One to 
Stage Two, and from Stage Two to Stage Three) when, in each of three 
consecutive rounds of bidding, the high bid has increased on 20 percent 
or less of the licenses being auctioned (as measured in bidding units). 
In addition, the Bureau will retain the discretion to regulate the pace 
of the auction by announcement. This determination will be based on a 
variety of measures of bidder activity, including, but not limited to, 
the auction activity level, the percentages of licenses (as measured in 
bidding units) on which there are new bids, the number of new bids, and 
the percentage increase in revenue. The Bureau believes that these 
stage transition rules, having proven successful in prior auctions, are 
appropriate for use in Auction No. 49.
v. Activity Rule Waivers and Reducing Eligibility
    110. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed that each bidder in 
the auction would be provided five activity rule waivers. Bidders may 
use an activity rule waiver in any round during the course of the 
auction. Aloha and Cavalier support the Bureau's proposal on this 
issue.
    111. Based upon its experience in previous auctions, the Bureau 
adopts its proposal that each bidder be provided five activity rule 
waivers that may be used in any round during the course of the auction. 
Use of an activity rule waiver preserves the bidder's current bidding 
eligibility despite the bidder's activity in the current round being 
below the required level. An activity rule waiver applies to an entire 
round of bidding and not to a particular license. The Bureau is 
satisfied that our practice of providing five waivers over the course 
of the auction provides a sufficient number of waivers and flexibility 
to the bidders while safeguarding the integrity of the auction.
    112. The FCC Automated Auction System assumes that bidders with 
insufficient activity would prefer to use an activity rule waiver (if 
available) rather than lose bidding eligibility. Therefore, the system 
will automatically apply a waiver (known as an ``automatic waiver'') at 
the end of any round where a bidder's activity level is below the 
minimum required unless: (i) there are no activity rule waivers 
available; or (ii) the bidder overrides the automatic application of a 
waiver by reducing eligibility, thereby meeting the minimum 
requirements. If a bidder has no waivers remaining and does not satisfy 
the required activity level, the current eligibility will be 
permanently reduced, possibly eliminating the bidder from the auction.
    113. A bidder with insufficient activity that wants to reduce its 
bidding eligibility rather than use an activity rule waiver must 
affirmatively override the automatic waiver mechanism during the round 
by using the reduce eligibility function in the bidding system. In this 
case, the bidder's eligibility is permanently reduced to bring the 
bidder into compliance with the activity rules as described in 
``Auction Stages'' (see section IV.A.iii discussion). Once eligibility 
has been reduced, a bidder will not be permitted to regain its lost 
bidding eligibility.
    114. Finally, a bidder may proactively use an activity rule waiver 
as a means to keep the auction open without placing a bid. If a bidder 
submits a proactive waiver (using the proactive waiver function in the 
FCC Automated Auction System) during a round in which no bids are 
submitted, the auction will remain open and the bidder's eligibility 
will be preserved. However, an automatic waiver triggered during a 
round in which there are no new bids or withdrawals will not keep the 
auction open.

    Note: Once a proactive waiver is submitted during a round, that 
waiver cannot be unsubmitted.

vi. Auction Stopping Rules
    115. For Auction No. 49, the Bureau proposed to employ a 
simultaneous stopping rule. The Bureau also sought comment on a 
modified version of the stopping rule. The modified version of the 
stopping rule would close the auction for all licenses after the first 
round in which no bidder submits a proactive waiver, a withdrawal, or a 
new bid on any license on which it is not the standing high bidder. 
Thus, absent any other bidding activity, a bidder placing a new bid on 
a license for which it is the standing high bidder would not keep the 
auction open under this modified stopping rule.
    116. The Bureau further proposed retaining the discretion to keep 
the auction open even if no new bids or proactive waivers are submitted 
and no previous high bids are withdrawn in a round. In this event, the 
effect will be the same as if a bidder had submitted a proactive 
waiver. Thus, the activity rule will apply as usual, and a bidder with 
insufficient activity will either use an activity rule waiver (if it 
has any left) or lose bidding eligibility.
    117. In addition, the Bureau proposed that it reserve the right to 
declare that the auction will end after a designated number of 
additional rounds (``special stopping rule''). If the Bureau invokes 
this special stopping rule, it will accept bids in the final round(s) 
only for licenses on which the high bid increased in at least one of 
the preceding specified number of rounds. The Bureau proposed to 
exercise this option only in circumstances such as where the auction is 
proceeding very slowly, where there is minimal overall bidding activity 
or where it appears likely that the auction will not close within a 
reasonable period of time. Before exercising this option, the Bureau is 
likely to attempt to increase the pace of the auction by, for example, 
moving the auction into the next stage (where bidders will be required 
to maintain a higher level of bidding activity), increasing the number 
of rounds per day, and/or adjusting the minimum acceptable bids and bid 
increments for the licenses.
    118. Aloha and Cavalier support the Bureau's proposal concerning 
the auction stopping rules. In light of the foregoing, the Bureau 
adopts the proposals. Auction No. 49 will begin under the simultaneous 
stopping rule, and the Bureau will retain the discretion to invoke the 
other versions of the stopping rule. The Bureau believes that these 
stopping rules are most appropriate for Auction No. 49, because its 
experience in prior auctions demonstrates that the auction stopping 
rules balance the interests of administrative efficiency and maximum 
bidder participation.
vii. Auction Delay, Suspension, or Cancellation
    119. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed that, by public 
notice or by announcement during the auction, it may delay, suspend, or 
cancel the auction in the event of natural disaster, technical 
obstacle, evidence of an auction security breach, unlawful bidding 
activity, administrative or weather necessity, or for any other reason 
that affects the fair conduct of competitive bidding. Aloha and 
Cavalier support the Bureau's proposal on this issue.
    120. Because this approach has proven effective in resolving 
exigent circumstances in previous auctions, the Bureau adopts its 
proposed auction cancellation rules. By public notice or by 
announcement during the auction, the Bureau may delay, suspend, or 
cancel the auction in the event of natural disaster, technical 
obstacle, evidence of an auction security breach,

[[Page 14653]]

unlawful bidding activity, administrative or weather necessity, or for 
any other reason that affects the fair and competitive conduct of 
competitive bidding. In such cases, the Bureau, in its sole discretion, 
may elect to resume the auction starting from the beginning of the 
current round, resume the auction starting from some previous round, or 
cancel the auction in its entirety. Network interruption may cause the 
Bureau to delay or suspend the auction. The Bureau emphasizes that 
exercise of this authority is solely within its discretion, and its use 
is not intended to be a substitute for situations in which bidders may 
wish to apply their activity rule waivers.

B. Bidding Procedures

i. Round Structure
    121. The initial bidding schedule will be announced in the public 
notice listing the qualified bidders, which is released approximately 
10 days before the start of the auction. Each bidding round is followed 
by the release of round results. Multiple bidding rounds may be 
conducted in a given day. Details regarding round results formats and 
locations will also be included in the qualified bidders public notice.
    122. The FCC has discretion to change the bidding schedule in order 
to foster an auction pace that reasonably balances speed with the 
bidders' need to study round results and adjust their bidding 
strategies. The Bureau may increase or decrease the amount of time for 
the bidding rounds and review periods, or the number of rounds per day, 
depending upon the bidding activity level and other factors.
ii. Reserve Price or Minimum Opening Bid
    123. Background. The Balanced Budget Act calls upon the Commission 
to prescribe methods by which a reasonable reserve price will be 
required or a minimum opening bid established when FCC licenses are 
subject to auction (i.e., because they are mutually exclusive), unless 
the Commission determines that a reserve price or minimum opening bid 
is not in the public interest. Consistent with this mandate, the 
Commission directed the Bureau to seek comment on the use of a minimum 
opening bid and/or reserve price prior to the start of each auction. 
Among other factors, the Bureau must consider the amount of spectrum 
being auctioned, levels of incumbency, the availability of technology 
to provide service, the size of the geographic service areas, the 
extent of interference with other spectrum bands, and any other 
relevant factors that could have an impact on the spectrum being 
auctioned. The Commission concluded that the Bureau should have the 
discretion to employ either or both of these mechanisms for future 
auctions.
    124. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed to establish minimum 
opening bids for Auction No. 49 and to retain discretion to lower the 
minimum opening bids. Specifically, for Auction No. 49, the Bureau 
proposed the following license-by-license formula for calculating 
minimum opening bids:

$0.01 * MHz * License Area Population with a minimum of $1,000 per 
license.

    125. In the alternative, the Bureau sought comment on whether, 
consistent with the Balanced Budget Act, the public interest would be 
served by having no minimum opening bid or reserve price.
    126. Two commenters allege that the minimum opening bids are too 
high and ask that the Bureau revise the proposed formula to reduce the 
minimum opening bids. Neither commenter proposes a specific reduction 
to the minimum opening bids nor a specific change to the formula used 
to compute the minimum opening bid. Further, the commenters provide no 
evidence that the proposed minimum opening bids are too high.
    127. Following consideration of comments received, the Bureau 
adopts its proposed minimum opening bids for Auction No. 49. The Bureau 
notes that the minimum opening bids adopted here are approximately 60% 
less than those used in Auction No. 44. Based on this reduction and 
other considerations, the Bureau believes the minimum opening bids are 
well below the levels of the likely winning bids, and are not so high 
as to discourage competition. Thus, the Bureau is not persuaded that 
the proposed minimum opening bids are unreasonable.
    128. The minimum opening bids adopted for Auction No. 49 are 
reducible at the discretion of the Bureau. The Bureau emphasizes, 
however, that such discretion will be exercised, if at all, sparingly 
and early in the auction, i.e., before bidders lose all waivers and 
begin to lose substantial eligibility. During the course of the 
auction, the Bureau will not entertain any requests to reduce the 
minimum opening bid on specific licenses.
    129. The specific minimum opening bids for each license available 
in Auction No. 49 are set forth in Attachment A of the Auction No. 49 
Procedures Public Notice.
iii. Minimum Acceptable Bids and Bid Increments
    130. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed to use a smoothing 
methodology to calculate minimum acceptable bids. The smoothing 
methodology is designed to vary the increment for a given license 
between a maximum and minimum percentage based on the bidding activity 
on that license. This methodology allows the increments to be tailored 
to the activity on a license, decreasing the time it takes for licenses 
receiving many bids to reach their final prices. The formula used to 
calculate this increment is included as Attachment F of the Auction No. 
49 Procedures Public Notice. The Bureau further proposed to retain the 
discretion to change the minimum acceptable bids and bid increments if 
circumstances so dictate. Aloha and Cavalier support the Bureau's 
position concerning minimum acceptable bids and bid increments.
    131. In each round, each eligible bidder will be able to place a 
bid on a particular license for which it applied in any of nine 
different amounts. The FCC Automated Auction System will list the nine 
bid amounts for each license.
    132. Once there is a standing high bid on a license, the FCC 
Automated Auction System will calculate a minimum acceptable bid for 
that license for the following round, as described in Attachment F of 
the Auction No. 49 Procedures Public Notice. The difference between the 
minimum acceptable bid and the standing high bid for each license will 
define the bid increment--i.e., bid increment = (minimum acceptable 
bid)-(standing high bid). The nine acceptable bid amounts for each 
license consist of the minimum acceptable bid (the standing high bid 
plus one bid increment) and additional amounts calculated using 
multiple bid increments (i.e., the second bid amount equals the 
standing high bid plus two times the bid increment, the third bid 
amount equals the standing high bid plus three times the bid increment, 
etc.).
    133. At the start of the auction and until a bid has been placed on 
a license, the minimum acceptable bid for that license will be equal to 
its minimum opening bid. Corresponding additional bid amounts will be 
calculated using bid increments defined as the difference between the 
minimum opening bid times one plus the percentage increment, rounded as 
described in

[[Page 14654]]

Attachment F of the Auction No. 49 Procedures Public Notice, and the 
minimum opening bid--i.e., bid increment = (minimum opening bid)(1 + 
percentage increment) {rounded{time} -(minimum opening bid). At the 
start of the auction and until a bid has been placed on a license, the 
nine acceptable bid amounts for each license consist of the minimum 
opening bid and additional amounts calculated using multiple bid 
increments (i.e., the second bid amount equals the minimum opening bid 
plus the bid increment, the third bid amount equals the minimum opening 
bid plus two times the bid increment, etc.)
    134. In the case of a license for which the standing high bid has 
been withdrawn, the minimum acceptable bid will equal the second 
highest bid received for the license. The additional bid amounts are 
calculated using the difference between the second highest bid times 
one plus the minimum percentage increment, rounded, and the second 
highest bid.
    135. The Bureau retains the discretion to change the minimum 
acceptable bids and bid increments and the methodology for determining 
the minimum acceptable bids and bid increments if they determine 
circumstances so dictate. The Bureau will do so by announcement in the 
FCC Automated Auction System. The Bureau may also use its discretion to 
adjust the minimum bid increment without prior notice if circumstances 
warrant.
iv. High Bids
    136. At the end of each bidding round, the high bids will be 
determined based on the highest gross bid amount received for each 
license. A high bid from a previous round is sometimes referred to as a 
``standing high bid.'' A ``standing high bid'' will remain the high bid 
until there is a higher bid on the same license at the close of a 
subsequent round. Bidders are reminded that standing high bids count 
towards bidding activity.
    137. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed to use a random 
number generator to select a high bid in the event of identical high 
bids on a license in a given round (i.e., tied bids). Aloha and 
Cavalier support the Bureau's proposal concerning tie bids. No 
commenter opposed the Bureau's proposal. Therefore, the Bureau adopts 
its proposal. A Sybase[reg] SQL pseudo-random number generator based on 
the Lecuyer algorithm will be used to assign a random number to each 
bid. The tied bid having the highest random number will become the 
standing high bid. The remaining bidders, as well as the high bidder, 
will be able to submit a higher bid in a subsequent round. If no bidder 
submits a higher bid in a subsequent round, the high bid from the 
previous round will win the license. If any bids are received on the 
license in a subsequent round, the high bid will once again be 
determined on the highest gross bid amount received for the license.
v. Bidding
    138. During a round, a bidder may submit bids for as many licenses 
as it wishes (subject to its eligibility), withdraw high bids from 
previous bidding rounds, remove bids placed in the same bidding round, 
or permanently reduce eligibility. Bidders also have the option of 
making multiple submissions and withdrawals in each round. If a bidder 
submits multiple bids for a single license in the same round, the 
system takes the last bid entered as that bidder's bid for the round. 
Bidders should note that the bidding units associated with licenses for 
which the bidder has removed or withdrawn its bid do not count towards 
the bidder's activity at the close of the round.
    139. Please note that all bidding will take place remotely either 
through the FCC Automated Auction System or by telephonic bidding. 
(Telephonic bid assistants are required to use a script when entering 
bids placed by telephone. Telephonic bidders are therefore reminded to 
allow sufficient time to bid by placing their calls well in advance of 
the close of a round. Normally, four to five minutes are necessary to 
complete a bid submission.) There will be no on-site bidding during 
Auction No. 49.
    140. A bidder's ability to bid on specific licenses in the first 
round of the auction is determined by two factors: (i) The licenses 
applied for on FCC Form 175 and (ii) the upfront payment amount 
deposited. The bid submission screens will allow bidders to submit bids 
on only those licenses for which the bidder applied on its FCC Form 
175.
    141. In order to access the bidding functions of the FCC Automated 
Auction System, bidders must be logged in during the bidding round 
using the bidder identification number provided in the registration 
materials, and the passcode generated by the SecurID card. Bidders are 
strongly encouraged to print bid confirmations for each round after 
they have completed all of their activity for that round.
    142. In each round, eligible bidders will be able to place bids on 
a given license in any of nine different amounts. For each license, the 
FCC Automated Auction System interface will list the nine acceptable 
bid amounts in a drop-down box. Bidders may use the drop-down box to 
select from among the nine bid amounts. The FCC Automated Auction 
System also includes an import function that allows bidders to upload 
text files containing bid information.
    143. Until a bid has been placed on a license, the minimum 
acceptable bid for that license will be equal to its minimum opening 
bid. Once there is a standing high bid on a license, the FCC Automated 
Auction System will calculate a minimum acceptable bid for that license 
for the following round, as described in section IV.B.iii.
    144. Finally, bidders are cautioned in selecting their bid amounts 
because, as explained in the following section, bidders who withdraw a 
standing high bid from a previous round, even if mistakenly or 
erroneously made, are subject to bid withdrawal payments.
vi. Bid Removal and Bid Withdrawal
    145. In the Auction No. 49 Comment Public Notice and Auction No. 49 
Revised Comment Public Notice, the Bureau proposed bid removal and bid 
withdrawal procedures. Aloha and Cavalier agree with the Bureau's 
proposal concerning bid removal and bid withdrawal. With respect to bid 
withdrawals, the Bureau proposed limiting each bidder to withdrawals in 
no more than two rounds during the course of the auction. The two 
rounds in which withdrawals are used, the Bureau proposed, would be at 
the bidder's discretion.
    146. Procedures. Before the close of a bidding round, a bidder has 
the option of removing any bids placed in that round. By using the 
``remove bid'' function in the bidding system, a bidder may effectively 
``unsubmit'' any bid placed within that round. A bidder removing a bid 
placed in the same round is not subject to withdrawal payments. 
Removing a bid will affect a bidder's activity for the round in which 
it is removed, i.e., a bid that is removed does not count towards 
bidding activity. This procedure will enhance bidder flexibility during 
the auction, and therefore, the Bureau adopts these procedures for 
Auction No. 49.
    147. Once a round closes, a bidder may no longer remove a bid. 
However, in later rounds, a bidder may withdraw standing high bids from 
previous rounds using the withdraw bid function in the FCC Automated 
Auction System (assuming that the bidder has not reached its withdrawal 
limit). A high bidder that withdraws its standing high bid from a 
previous round during the

[[Page 14655]]

auction is subject to the bid withdrawal payments specified in 47 CFR 
1.2104(g).

    Note: Once a withdrawal is placed during a round, that 
withdrawal cannot be unsubmitted.

    148. In previous auctions, the Bureau has detected bidder conduct 
that, arguably, may have constituted strategic bidding through the use 
of bid withdrawals. While the Bureau continues to recognize the 
important role that bid withdrawals play in an auction, i.e., reducing 
risk associated with efforts to secure various licenses in combination, 
the Bureau concludes that, for Auction No. 49, adoption of a limit on 
the use of withdrawals to two rounds per bidder is appropriate. By 
doing so the Bureau believes it strikes a reasonable compromise that 
will allow bidders to use withdrawals. Its decision on this issue is 
based upon its experience in prior auctions, particularly the PCS D, E 
and F block and 800 MHz SMR auctions, and is in no way a reflection of 
our view regarding the likelihood of any speculation or ``gaming'' in 
this auction.
    149. The Bureau will therefore limit the number of rounds in which 
bidders may place withdrawals to two rounds. These rounds will be at 
the bidder's discretion and there will be no limit on the number of 
bids that may be withdrawn in either of these rounds. Withdrawals 
during the auction will be subject to the bid withdrawal payments 
specified in 47 CFR 1.2104(g). Bidders should note that abuse of the 
Commission's bid withdrawal procedures could result in the denial of 
the ability to bid on a market.
    150. If a high bid is withdrawn, the minimum acceptable bid will 
equal the second highest bid received for the license, which may be 
less than, or equal to, in the case of tied bids, the amount of the 
withdrawn bid. To set the additional bid amounts, the second highest 
bid also will be used in place of the standing high bid in the formula 
used to calculate bid increments. The Commission will serve as a 
``place holder'' high bidder on the license until a new bid is 
submitted on that license.
    151. Calculation. Generally, the Commission imposes payments on 
bidders that withdraw high bids during the course of an auction. If a 
bidder withdraws its bid and there is no higher bid in the same or 
subsequent auction(s), the bidder that withdrew its bid is responsible 
for the difference between its withdrawn bid and the high bid in the 
same or subsequent auction(s). See 47 CFR 1.2104(g)(1). In the case of 
multiple bid withdrawals on a single license, within the same or 
subsequent auction(s), the payment for each bid withdrawal will be 
calculated based on the sequence of bid withdrawals and the amounts 
withdrawn. No withdrawal payment will be assessed for a withdrawn bid 
if either the subsequent winning bid or any of the intervening 
subsequent withdrawn bids, in either the same or subsequent auction(s), 
equals or exceeds that withdrawn bid. Thus, a bidder that withdraws a 
bid will not be responsible for any withdrawal payments if there is a 
subsequent higher bid in the same or subsequent auction(s). This policy 
allows bidders most efficiently to allocate their resources as well as 
to evaluate their bidding strategies and business plans during an 
auction while, at the same time, maintaining the integrity of the 
auction process. The Bureau retains the discretion to scrutinize 
multiple bid withdrawals on a single license for evidence of anti-
competitive strategic behavior and take appropriate action when deemed 
necessary.
    152. In the Part 1 Fifth Report and Order, the Commission modified 
Sec.  1.2104(g)(1) of the rules regarding assessments of interim bid 
withdrawal payments. As amended, Sec.  1.2104(g)(1) provides that in 
instances in which bids have been withdrawn on a license that is not 
won in the same auction, the Commission will assess an interim 
withdrawal payment equal to 3 percent of the amount of the withdrawn 
bids. The 3 percent interim payment will be applied toward any final 
bid withdrawal payment that will be assessed after subsequent auction 
of the license. Assessing an interim bid withdrawal payment ensures 
that the Commission receives a minimal withdrawal payment pending 
assessment of any final withdrawal payment. The Part 1 Fifth Report and 
Order provides specific examples showing application of the bid 
withdrawal payment rule.
vii. Round Results
    153. Bids placed during a round will not be made public until the 
conclusion of that bidding period. After a round closes, the Bureau 
will compile reports of all bids placed, bids withdrawn, current high 
bids, new minimum acceptable bids, and bidder eligibility status 
(bidding eligibility and activity rule waivers), and post the reports 
for public access. Reports reflecting bidders' identities for Auction 
No. 49 will be available before and during the auction. Thus, bidders 
will know in advance of this auction the identities of the bidders 
against which they are bidding.
viii. Auction Announcements
    154. The FCC will use auction announcements to announce items such 
as schedule changes and stage transitions. All FCC auction 
announcements will be available by clicking a link on the FCC Automated 
Auction System.
ix. Maintaining the Accuracy of FCC Form 175 Information
    155. As noted in section II.H., after the short-form filing 
deadline, applicants may make only minor changes to their FCC Form 175 
applications. For example, permissible minor changes include deletion 
and addition of authorized bidders (to a maximum of three) and certain 
revision of exhibits. Applicants must make these modifications to their 
FCC Form 175 electronically and submit a letter, briefly summarizing 
the changes, by electronic mail to the attention of Margaret Wiener, 
Chief, Auctions and Industry Analysis Division at the following 
address: [email protected]. The electronic mail summarizing the changes 
must include a subject or caption referring to Auction No. 49. The 
Bureau requests that parties format any attachments to electronic mail 
as Adobe[reg] Acrobat[reg] (pdf) or Microsoft[reg] Word documents.
    156. A separate copy of the letter should be faxed to the attention 
of Kathryn Garland at (717) 338-2850. Questions about other changes 
should be directed to Howard Davenport of the Auctions and Industry 
Analysis Division at (202) 418-0660.

V. Post-Auction Procedures

A. Down Payments and Withdrawn Bid Payments

    157. After bidding has ended, the Commission will issue a public 
notice declaring the auction closed, identifying winning bidders, down 
payments and any withdrawn bid payments due.
    158. Within ten business days after release of the auction closing 
notice, each winning bidder must submit sufficient funds (in addition 
to its upfront payment) to bring its total amount of money on deposit 
with the Commission for Auction No. 49 to 20 percent of its net winning 
bids (actual bids less any applicable small, very small business or 
entrepreneur bidding credits). In addition, by the same deadline all 
bidders must pay any bid withdrawal payments due under 47 CFR 
1.2104(g), as discussed in ``Bid Removal and Bid Withdrawal,'' section 
IV.B.vi. (Upfront payments are applied first to satisfy any withdrawn 
bid liability,

[[Page 14656]]

before being applied toward down payments.)

B. Auction Discount Voucher

    159. On June 8, 2000, the Commission awarded Qualcomm, Inc. a 
transferable Auction Discount Voucher (``ADV'') in the amount of 
$125,273,878.00. This ADV may be used by Qualcomm or its transferee, in 
whole or in part, to adjust a winning bid in any spectrum auction prior 
to June 8, 2003, subject to terms and conditions set forth in the 
Commission's Order. Qualcomm transferred $10,848,000.00 of the ADV to a 
winning bidder in FCC Auction No. 35 and the transferee used its 
portion of the ADV to pay a portion of one of its winning bids in 
Auction No. 35. The remaining portion of Qualcomm's ADV could be used 
to adjust winning bids in another FCC auction, including Auction No. 
49.

C. Long-Form Application (FCC Form 601)

    160. Within ten business days after release of the auction closing 
notice, winning bidders must electronically submit a properly completed 
long-form application (FCC Form 601) and required exhibits for each 
license won through Auction No. 49. Winning bidders that are small, 
very small businesses or entrepreneurs must include an exhibit 
demonstrating their eligibility for small, very small business or 
entrepreneur bidding credits. See 47 CFR 1.2112(b). Further filing 
instructions will be provided to auction winners at the close of the 
auction.

D. Ownership Disclosure Information Report (FCC Form 602)

    161. At the time it submits its long-form application (FCC Form 
601), each winning bidder also must comply with the ownership reporting 
requirements as set forth in 47 CFR 1.913, 1.919, and 1.2112(a). We 
remind applicants that effective December 10, 2002, electronic filing 
of the Ownership Disclosure Information Report (FCC Form 602) became 
mandatory. Accordingly, forms filed manually will not be accepted. 
Winning bidders without a current Form 602 already on file with the 
Commission must submit a properly completed Form 602 at the time they 
submit their long-form applications. Further filing instructions will 
be provided to auction winners at the close of the auction.

E. Tribal Land Bidding Credit

    162. A winning bidder that intends to use its license(s) to deploy 
facilities and provide services to federally-recognized tribal lands 
that are unserved by any telecommunications carrier or that have a 
telephone service penetration rate equal to or below 70 percent is 
eligible to receive a tribal land bidding credit as set forth in 47 CFR 
1.2107 and 1.2110(f). A tribal land bidding credit is in addition to, 
and separate from, any other bidding credit for which a winning bidder 
may qualify.
    163. Unlike other bidding credits that are requested prior to the 
auction, a winning bidder applies for the tribal land bidding credit 
after winning the auction when it files its long-form application (FCC 
Form 601). When filing the long-form application, the winning bidder 
will be required to advise the Commission whether it intends to seek a 
tribal land bidding credit, for each market won in the auction, by 
checking the designated box(es). After stating its intent to seek a 
tribal land bidding credit, the applicant will have 90 days from the 
close of the long-form filing window to amend its application to select 
the specific tribal lands to be served and provide the required tribal 
government certifications. Licensees receiving a tribal land bidding 
credit are subject to performance criteria as set forth in 47 CFR 
1.2110(f).
    164. For additional information on the tribal land bidding credit, 
including how the amount of the credit is calculated, applicants should 
review the Commission's rule making proceeding regarding tribal land 
bidding credits and related public notices. Relevant documents can be 
viewed on the Commission's Web site by going to http://wireless.fcc.gov/auctions and clicking on the Tribal Land Credits link.

F. Default and Disqualification

    165. Any high bidder that defaults or is disqualified after the 
close of the auction (i.e., fails to remit the required down payment 
within the prescribed period of time, fails to submit a timely long-
form application, fails to make full payment, or is otherwise 
disqualified) will be subject to the payments described in 47 CFR 
1.2104(g)(2). In such event the Commission may re-auction the license 
or offer it to the next highest bidder (in descending order) at their 
final bid. In addition, if a default or disqualification involves gross 
misconduct, misrepresentation, or bad faith by an applicant, the 
Commission may declare the applicant and its principals ineligible to 
bid in future auctions, and may take any other action that it deems 
necessary, including institution of proceedings to revoke any existing 
licenses held by the applicant.

G. Refund of Remaining Upfront Payment Balance

    166. All applicants that submitted upfront payments but were not 
winning bidders for a license in Auction No. 49 may be entitled to a 
refund of their remaining upfront payment balance after the conclusion 
of the auction. No refund will be made unless there are excess funds on 
deposit from that applicant after any applicable bid withdrawal 
payments have been paid. All refunds will be returned to the payer of 
record, as identified on the FCC Form 159, unless the payer submits 
written authorization instructing otherwise.
    167. Bidders that drop out of the auction completely may be 
eligible for a refund of their upfront payments before the close of the 
auction. Qualified bidders that have exhausted all of their activity 
rule waivers, have no remaining bidding eligibility, and have not 
withdrawn a high bid during the auction must submit a written refund 
request. If you have completed the refund instructions electronically, 
then only a written request for the refund is necessary. If not, the 
request must also include wire transfer instructions, Taxpayer 
Identification Number (TIN) and FCC Registration Number (FRN). Send 
refund request to: Federal Communications Commission, Financial 
Operations Center, Auctions Accounting Group, Gail Glasser or Tim 
Dates, 445 12th Street, SW., Room [chyph]1-C863, Washington, DC 20554.
    168. Bidders are encouraged to file their refund information 
electronically using the refund information portion of the FCC Form 
175, but bidders can also fax their information to the Auctions 
Accounting Group at (202) 418-2843. Once the information has been 
approved, a refund will be sent to the party identified in the refund 
information.

    Note: Refund processing generally takes up to two weeks to 
complete. Bidders with questions about refunds should contact Gail 
Glasser at (202) 418-0578 or Tim Dates at (202) 418-0496.


Federal Communications Commission.
Louis J. Sigalos,
Deputy Chief, Auctions and Industry Analysis Division, WTB.
[FR Doc. 03-7190 Filed 3-25-03; 8:45 am]
BILLING CODE 6712-01-P