[Federal Register Volume 73, Number 90 (Thursday, May 8, 2008)]
[Notices]
[Pages 26112-26118]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-10381]


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FEDERAL COMMUNICATIONS COMMISSION

[AU Docket No. 08-32; Report No. AUC-08-77-B (Auction 77); DA 08-926]


Closed Auction of Licenses For Cellular Unserved Service Areas 
Scheduled for June 17, 2008; Notice and Filing Requirements, Minimum 
Opening Bids, Upfront Payments and Other Procedures for Auction 77

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: This document announces the procedures and minimum opening 
bids for the upcoming Closed Auction of Licenses for Cellular Unserved 
Service Areas (Auction 77). This document is intended to familiarize 
prospective

[[Page 26113]]

bidders with the procedures and minimum opening bids for the auction.

DATES: Short Form Applications to participate in Auction 77 must be 
filed before 6 p.m. ET on May 14, 2008. The upfront payments deadline 
for Auction 77 is June, 2, 2008, 6 p.m. ET. Bidding for Auction No. 77 
is scheduled to begin on June 17, 2008.

FOR FURTHER INFORMATION CONTACT: Wireless Telecommunications Bureau, 
Auctions Spectrum and Access Division: For legal questions: Sayuri 
Rajapakse at (202) 418-0660. For general auction questions: Barbara 
Sibert at (717) 338-2868. Mobility Division: For service rule 
questions: Erin McGrath (legal), Gabriel Ubieta (engineering) and 
Denise Walter (licensing) at (202) 418-0620. To request materials in 
accessible formats (Braille, large print, electronic files or audio 
format) for people with disabilities, send an e-mail to [email protected] 
or call the Consumer and Governmental Affairs Bureau at (202) 418-0530 
or (202) 418-0432 (TTY).

SUPPLEMENTARY INFORMATION: This is a summary of the Auction 77 
Procedures Public Notice which was released on April 25, 2008. The 
complete text of the Auction 77 Procedures Public Notice, including 
attachments, as well as related Commission documents are available for 
public inspection and copying at the FCC Reference Information Center. 
The Auction 77 Procedures Public Notice and related Commission 
documents may also be purchased from the Commission's duplicating 
contractor, Best Copy and Printing, Inc. (BCPI), Portals II, 445 12th 
Street, SW., Room CY-B402, Washington, DC 20554, telephone 202-488-
5300, facsimile 202-488-5563, or Web site: http://www.BCPIWEB.com. The 
Auction 77 Procedures Public Notice and related documents are also 
available on the Internet at the Commission's Web site: http://wireless.fcc.gov/auctions/77/.

I. General Information

A. Introduction

    1. The Wireless Telecommunications Bureau (Bureau) announces the 
procedures and minimum opening bid amounts for the upcoming closed 
auction of Cellular Radiotelephone Service licenses covering two 
different unserved areas (Auction 77). Auction 77 is scheduled to begin 
on June 17, 2008.
i. Background of Proceeding
    2. On March 21, 2008, in accordance with Section 309(j)(3) of the 
Communications Act of 1934, as amended, the Bureau released a public 
notice seeking comment on competitive bidding procedures to be used in 
Auction 77. In the Auction 77 Comment Public Notice, 73 FR 18276, April 
3, 2008, the Bureau proposed to award the licenses using a single-round 
sealed-bid auction and sought comment on procedures for the conduct of 
Auction 77. The Bureau received one comment and no reply comments in 
response to the Auction 77 Comment Public Notice.
 ii. Licenses To Be Offered in Auction 77
    3. The spectrum to be auctioned is the subject of two groups of 
pending mutually exclusive long-form applications (FCC Form 601s) for 
unserved area licenses in the Cellular Radiotelephone Service. 
Participation in Auction 77 will be limited to those applicants 
identified in Attachment A of the Auction 77 Procedures Public Notice. 
Licenses will be auctioned for each mutually exclusive applicant group 
(MX group) identified in Attachment A. The winning bidder in each group 
will be licensed to serve only the unserved area proposed in its long-
form application(s) for that MX group.
    4. Consistent with the Commission's determination in the 
Competitive Bidding Ninth Report and Order, 61 FR 58333, November 14, 
1996, all pending mutually exclusive applications for unserved area 
licenses in the Cellular Radiotelephone Service must be resolved 
through a system of competitive bidding. When the short-form 
applications of two or more applicants within an MX group are accepted 
for filing, mutual exclusivity exists for auction purposes. Once mutual 
exclusivity exists for auction purposes, even if only one applicant 
within an MX group submits an upfront payment, that applicant is 
required to submit a bid in order to obtain the license. Any applicant 
that submits a short-form application but fails to timely submit an 
upfront payment will not be eligible to bid.

B. Rules and Disclaimers

i. Relevant Authority
    5. Prospective applicants must familiarize themselves thoroughly 
with the Commission's general competitive bidding rules set forth in 47 
CFR part 1 and 22 including recent amendments and clarifications; rules 
relating to the Cellular Radiotelephone Service and rules relating to 
applications, environment, practice and procedure. Prospective 
applicants must also be thoroughly familiar with the procedures, terms 
and conditions (collectively, terms) contained in the Auction 77 
Procedures Public Notice and the Commission's decisions in proceedings 
regarding competitive bidding procedures, application requirements, and 
obligations of Commission licensees.
    6. 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 its public notices at any time, 
and will issue public notices to convey any new or supplemental 
information to applicants. It is the responsibility of all applicants 
to remain current with all Commission rules and with all public notices 
pertaining to Auction 77.
ii. Prohibition of Collusion; Compliance With Antitrust Laws
    7. To ensure the competitiveness of the auction process, 47 CFR 
1.2105(c) of the Commission's rules prohibits auction applicants for 
licenses in any of the same geographic license areas from communicating 
with each other about bids, bidding strategies, or settlements unless 
such applicants have identified each other on their short-form 
applications (FCC Forms 175) as parties with whom they have entered 
into agreements pursuant to 47 CFR 1.2105(a)(2)(viii). This prohibition 
applies to all applicants regardless of whether such applicants become 
qualified bidders or actually bid. Section 1.2105(c)'s anti-collusion 
prohibition begins at the short-form application filing deadline and 
ends at the down payment deadline after the auction. If an applicant 
makes or receives a communication that appears to violate the anti-
collusion rule, it must report such communication in writing to the 
Commission immediately and in no case later than five business days 
after the communication occurs. The Auction 77 Procedures Public Notice 
contains specific guidance for applicants on the applicability of and 
compliance with the Commission's anti-collusion rule and antitrust 
laws. A summary listing of documents issued by the Commission and the 
Bureau addressing the application of the anti-collusion rule may be 
found in Attachment D of the Auction 77 Procedures Public Notice.
iii. Due Diligence
    8. The FCC makes no representations or warranties about the use of 
this spectrum for particular services. Applicants should perform their 
individual due diligence before proceeding as they would with any new 
business venture.
    9. Potential bidders are strongly encouraged to conduct their own

[[Page 26114]]

research prior to the beginning of bidding in Auction 77 in order to 
determine the existence of any pending legislative, administrative or 
judicial proceedings that might affect their decision regarding 
participation in the auction. Participants in Auction 77 are strongly 
encouraged to continue such research throughout the auction. In 
addition, potential bidders should perform technical analyses 
sufficient to assure themselves that, should they prevail in 
competitive bidding for a specific license, they will be able to build 
and operate facilities that will fully comply with the Commission's 
technical and legal requirements as well as other applicable Federal, 
state, and local laws.
    10. Applicants should perform due diligence to identify and 
consider all proceedings that may affect the spectrum licenses being 
auctioned and that could have an impact on the availability of spectrum 
for Auction 77. In addition, although the Commission may continue to 
act on various pending applications, informal objections, petitions, 
and other requests for Commission relief, some of these matters may not 
be resolved by the beginning of bidding in the auction.
    11. Applicants 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 being offered.
iv. Use of Integrated Spectrum Auction System
    12. The Commission will make available a browser-based bidding 
system to allow bidders to participate in Auction 77 over the Internet 
using the Commission's Integrated Spectrum Auction System (ISAS or FCC 
Auction System). The Commission makes no warranty whatsoever with 
respect to the FCC Auction System. In no event shall the Commission, or 
any of its officers, employees or agents, be liable for any damages 
whatsoever (including, but not limited to, loss of business profits, 
business interruption, loss of business information, or any other loss) 
arising out of or relating to the existence, furnishing, functioning or 
use of the FCC Auction System that is accessible to qualified bidders 
in connection with Auction 77. Moreover, no obligation or liability 
will arise out of the Commission's technical, programming or other 
advice or service provided in connection with the FCC Auction System.

C. Auction Specifics

i. Auction 77 Start Date
    13. Bidding in Auction 77 will be held on Tuesday, June 17, 2008. 
Unless otherwise announced, the licenses to provide cellular service in 
the two different unserved areas will be offered at the same time.
    14. The start and finish time of bidding will be announced by 
public notice approximately ten days before the start of the auction.
ii. Bidding Methodology
    15. The bidding methodology for Auction 77 will be single-round 
sealed-bid. The single-round sealed-bid format will consist of one 
bidding round followed by the release of auction results. In the event 
of tied bids in an MX group, the Commission will post an announcement 
in the FCC Auction System to announce an additional round of bidding 
for that MX group. The Commission will conduct Auction 77 over the 
Internet using the FCC Auction System, and telephonic bidding will be 
available as well. All telephone calls are recorded.
iii. Pre-Auction Dates and Deadlines
    16. The following dates and deadlines apply:

Auction 77 Short-Form Application (FCC Form 175) Filing Window Opens--
May 14, 2008; 9 a.m. ET.
Auction 77 Short-Form Application (FCC Form 175) Filing Window 
Deadline--May 16, 2008; prior to 6 p.m. ET.
Auction 77 Upfront Payment Deadline (via wire transfer)--June 2, 2008; 
6 p.m. ET.
Auction 77 Begins--June 17, 2008.
iv. Requirements for Participation in Auction 77
    17. Those wishing to participate in Auction 77 must: (1) Submit a 
short-form application (FCC Form 175) electronically prior to 6 p.m. 
ET, May 16, 2008, following the electronic filing procedures set forth 
in Attachment B of the Auction 77 Procedures Public Notice; (2) submit 
a sufficient upfront payment and an FCC Remittance Advice Form (FCC 
Form 159) by 6 p.m. ET, June 2, 2008, following the procedures and 
instructions set forth in Attachment C of the Auction 77 Procedures 
Public Notice; and (3) comply with all provisions outlined in the 
Auction 77 Procedures Public Notice and applicable Commission rules.

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

    18. Entities seeking licenses available in Auction 77 must file a 
short-form application (FCC Form 175) electronically following the 
procedures prescribed in Attachment B of the Auction 77 Procedures 
Public Notice. Applicants filing a short-form application are subject 
to the Commission's anti-collusion rules beginning on the deadline for 
filing. Applicants bear full responsibility for submitting accurate, 
complete and timely short-form applications. All applicants must 
certify on their short-form applications under penalty of perjury that 
they are legally, technically, financially and otherwise qualified to 
hold a license. Applicants should read the instructions set forth in 
Attachment B of the Auction 77 Procedures Public Notice carefully and 
should consult the Commission's rules to ensure that all the 
information that is required under the Commission's rules is included 
with their short-form applications.
    19. An entity may not submit more than one short-form application 
for Auction 77. If a party submits multiple short-form applications for 
Auction 77, only one application will be accepted for filing.
    20. Applicants also should note that submission of a short-form 
application (and any amendments thereto) constitutes a representation 
by the certifying official that he or she is an authorized 
representative of the applicant, that he or she has read the form's 
instructions and certifications, and that the contents of the 
application, its certifications, and any attachments are true and 
correct. Applicants are not permitted to make major modifications to 
their applications; such impermissible changes include a change of the 
certifying official to the application. 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.

A. License Selection

    21. On its short-form application for Auction 77, an applicant must 
select the license for which it has filed a long-form application. 
Applicants will not be able to select the license for which they have 
not filed a long-form application.
    22. Applicants will not be able to change their license selections 
after the short-form application filing deadline. Applicants interested 
in participating in Auction 77 must have selected license(s) available 
in the respective

[[Page 26115]]

auction by the short-form application deadline. Applicants must confirm 
their license selections before the deadline for submitting FCC Form 
175. The FCC Auction System will not accept bids from an applicant on 
individual licenses that the applicant has not selected on its FCC Form 
175.

B. Disclosure of Bidding Arrangements

    23. Applicants will be required to identify in their short-form 
application for Auction 77 all parties with whom they have entered into 
any agreements, arrangements, or understandings of any kind relating to 
the licenses being auctioned in Auction 77, including any agreements 
relating to post-auction market structure.
    24. Applicants also will be required to certify under penalty of 
perjury in their short-form applications that they have not entered and 
will not enter into any explicit or implicit agreements, arrangements 
or understandings of any kind with any parties, other than those 
identified in the application to participate in Auction 77 regarding 
the amount of their bids, bidding strategies, or the particular 
licenses on which they will or will not bid. If an applicant has had 
discussions, but has not reached an agreement by the short-form 
application filing deadline, it would not include the names of parties 
to the discussions on its application and may not continue such 
discussions with any applicants after the deadline.

C. Ownership Disclosure Requirements

    25. All applicants must comply with the uniform part 1 ownership 
disclosure standards and provide information required by 47 CFR 1.2105 
and 1.2112 of the Commission's rules. Specifically, in completing the 
short-form application for Auction 77, applicants will be required to 
fully disclose information on the real party or parties-in-interest and 
ownership structure of the applicant. The ownership disclosure 
standards for the short-form application are prescribed in 47 CFR 
1.2105 and 1.2112 of the Commission's rules. Each applicant is 
responsible for information submitted in its short-form application 
being complete and accurate.

D. Provisions Regarding Former and Current Defaulters

    26. Each applicant must state under penalty of perjury on its 
short-form application whether or not the applicant, its affiliates, 
its controlling interests, and the affiliates of its controlling 
interests, as defined by 47 CFR 1.2110, have ever been in default on 
any Commission licenses or have ever been delinquent on any non-tax 
debt owed to any Federal agency. In addition, each applicant must 
certify under penalty of perjury on its short-form application that, as 
of the short-form filing deadline, the applicant, its affiliates, its 
controlling interests, and the affiliates of its controlling interests, 
as defined by 47 CFR 1.2110, are not in default on any payment for 
Commission licenses (including down payments) and that they are not 
delinquent on any non-tax debt owed to any Federal agency. Prospective 
applicants are reminded that submission of a false certification to the 
Commission is a serious matter that may result in severe penalties, 
including monetary forfeitures, license revocations, exclusion from 
participation in future auctions, and/or criminal prosecution. These 
statements and certifications are prerequisites to submitting an 
application in the FCC Auction System.
    27. Former defaulters--i.e., applicants, including any of their 
affiliates, any of their controlling interests, or any of the 
affiliates of their controlling interests, 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 77, provided that they are otherwise 
qualified. However, former defaulters are required to pay upfront 
payments that are fifty percent more than the normal upfront payment 
amounts.
    28. Current defaulters--i.e., applicants, including any of their 
affiliates, any of their controlling interests, or any of the 
affiliates of their controlling interests, that are in default on any 
payment for any Commission licenses (including down payments) or are 
delinquent on any non-tax debt owed to any Federal agency as of the 
filing deadline for short-form applications--are not eligible to bid in 
Auction 77.
    29. Applicants are encouraged to review the Bureau's previous 
guidance on default and delinquency disclosure requirements in the 
context of the short-form application process.

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

    30. Applicants are not permitted to make major modifications to 
their short-form applications (e.g., change their license selections, 
change control of the applicant, or change the certifying official) 
after the short-form application deadline. Thus, any change in control 
of an applicant, resulting from a merger for example, will be 
considered a major modification to the applicant's FCC Form 175, which 
will consequently be dismissed.
    31. Applicants are, however, permitted to make only minor changes 
to their FCC Form 175 after the short-form application deadline. 
Permissible minor changes include, for example, deletion and addition 
of authorized bidders (to a maximum of three) and revision of addresses 
and telephone numbers of the applicants and their contact persons.
    32. The Auction 77 Procedures Public Notice also provides 
information on the mechanics of making permissible minor changes to its 
short-form application.

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

    33. 47 CFR 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. If an amendment reporting substantial changes is a major 
amendment as defined by 47 CFR 1.2105, the major amendment will not be 
accepted and may result in the dismissal of the short-form application.
    34. The Auction 77 Procedures Public Notice contains instructions 
on how to make minor changes to their short-form applications.

III. Pre-Auction Procedures

A. Short-Form Applications (FCC Form 175)--Due Prior to 6 p.m. ET on 
May 16, 2008

    35. In order to be eligible to bid in Auction 77, applicants must 
first follow the procedures set forth in Attachment B of the Auction 77 
Procedures Public Notice to submit an FCC Form 175 application 
electronically via the FCC Auction System. This application must be 
received at the Commission prior to 6 p.m. ET on May 16, 2008. Late 
applications will not be accepted. There is no application fee required 
when filing an FCC Form 175, but an applicant must submit an upfront 
payment to be eligible to bid.
    36. Applications may generally be filed at any time beginning at 9 
a.m. ET on May 14, 2008, and the filing window will close prior to 6 
p.m. ET on May 16, 2008. Applicants are strongly encouraged to file 
early and are responsible for allowing adequate time for filing their 
applications. Applicants may update or amend their applications 
multiple times until the filing deadline

[[Page 26116]]

on May 16, 2008. Applicants must always click on the SUBMIT button on 
the Certify & Submit screen of the electronic form to successfully 
submit or modify their FCC Form 175.
Application Processing and Minor Corrections
    37. After the deadline for filing short-form applications, the 
Commission will process all timely submitted applications to determine 
which are complete, and subsequently will issue a public notice 
identifying: (1) Those applications that are complete; (2) those 
applications rejected; and (3) those applications that are incomplete 
because of minor defects that may be corrected, and the deadline for 
resubmitting corrected applications.

B. Upfront Payments--Due June 2, 2008

    38. In order to be eligible to bid in Auction 77, 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 sent by facsimile to Mellon Bank in Pittsburgh, PA. All upfront 
payments for Auction 77 must be received in the proper account at 
Mellon Bank by 6 p.m. ET on June 2, 2008. The Auction 77 Procedures 
Public Notice contains instructions for using wire transfers to meet 
the upfront payment requirements.
    39. Please note that: (1) All payments must be made in U.S. 
dollars; (2) all payments must be made by wire transfer; (3) upfront 
payments for Auction 77 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; and (4) failure to deliver 
the upfront payment as instructed by the June 2, 2008, deadline will 
result in dismissal of the application and disqualification from 
participation in the auction.
i. FCC Form 159
    40. A completed FCC Remittance Advice Form (FCC Form 159, Revised 
7/05) must be sent by facsimile to Mellon Bank to accompany each 
upfront payment. Proper completion of FCC Form 159 (Revised 7/05) is 
critical to ensuring correct crediting of upfront payments. Detailed 
instructions for completion of FCC Form 159 are included in Attachment 
C to this Public Notice. An electronic pre-filled version of the FCC 
Form 159 is available after submitting the FCC Form 175. Payors using a 
pre-filled FCC Form 159 are responsible for ensuring that all of the 
information on the form, including payment amounts, is accurate. The 
FCC Form 159 can be completed electronically, but must be filed with 
Mellon Bank via facsimile.
ii. Upfront Payments and Bidding Eligibility
    41. Applicants must make the required upfront payment in order to 
be able to bid in Auction 77.
    42. In the Auction 77 Comment Public Notice, the Bureau proposed to 
set the upfront payment at $500 for each applicant. The Bureau did not 
receive any comments in response to the proposed upfront payments, or 
on its proposal that the upfront payment amount would determine a 
bidder's eligibility to participate in the auction. Therefore, the 
Bureau adopts the upfront payment for each applicant in Auction 77 as 
proposed and set forth in Attachment A of the Auction 77 Procedures 
Public Notice.
    43. Former defaulters must calculate their upfront payment by 
multiplying the upfront payment amount by 1.5.

C. Auction Registration

    44. Approximately ten days before the auction, the FCC will issue a 
public notice announcing all qualified bidders for Auction 77. 
Qualified bidders are those applicants whose FCC Form 175 applications 
have been accepted for filing, are complete and have timely submitted 
upfront payments sufficient to make them eligible to bid in Auction 77.
    45. All qualified bidders are automatically registered for the 
auction. Registration materials will be distributed prior to the 
auction by overnight mail. The mailing will be sent only to the contact 
person at the contact address listed in the FCC Form 175 and will 
include the SecurID[supreg] tokens that will be required to place bids, 
the Integrated Spectrum Auction System (ISAS) Bidder's Guide, and the 
Auction Bidder Line phone number.
    46. Qualified bidders that do not receive this registration mailing 
will not be able to submit bids. Therefore, any qualified bidder that 
has not received this mailing by noon on Thursday, June 12, 2008, 
should call (717) 338-2868. Receipt of this registration mailing is 
critical to participating in the auction, and each applicant is 
responsible for ensuring it has received all of the registration 
material.

IV. Auction 77

    47. Auction 77 will be held on Tuesday, June 17, 2008. The start 
and finish time of the bidding round will be announced in a public 
notice listing the qualified bidders, which is to be released 
approximately 10 days before the start of the auction.

A. Auction 77 Structure

i. Single-Round Sealed-Bid Auction
    48. In the Auction 77 Comment Public Notice, the Bureau proposed to 
award the licenses included in Auction 77 using a single-round sealed-
bid auction. A commenter supports the Bureau's proposal. The Bureau 
concludes that it is operationally feasible and appropriate to auction 
the cellular unserved service area licenses through a single-round 
sealed-bid auction.
ii. Auction Delay, Suspension, or Cancellation
    49. In the Auction 77 Comment Public Notice, the Bureau proposed 
that, 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, administrative or weather 
necessity, evidence of an auction security breach or unlawful bidding 
activity, or for any other reason that affects the fair and efficient 
conduct of competitive bidding. The Bureau received no comment on this 
issue.
    50. Because the Bureau's approach to notification of delay during 
an auction has proven effective in resolving exigent circumstances in 
previous auctions, the Bureau adopts its proposed rules regarding 
auction delay, suspension, or cancellation.

B. Bidding Procedures

 i. Round Structure
    51. The Commission will conduct Auction 77 over the Internet, and 
telephonic bidding will be available as well. The toll-free telephone 
number for the Auction Bidder Line will be provided to qualified 
bidders. The start and finish time of the bidding round will be 
announced in the public notice listing qualified bidders, which is 
released approximately 10 days before the start of the auction.
    52. The single-round sealed-bid format will consist of one bidding 
round followed by the release of auction results. In the event of tied 
bids in an MX group, the Commission will post an announcement in the 
FCC Auction System to announce an additional round of bidding for that 
MX group. The commenter supports the proposal.
 ii. Reserve Price or Minimum Bid
    53. In the Auction 77 Comment Public Notice, the Bureau proposed to 
set the minimum bid at $500 for each of the two cellular unserved areas 
in Auction

[[Page 26117]]

77. The Bureau received no comments concerning this proposal. 
Therefore, the minimum bid for each of the two cellular unserved areas 
is set at $500 and is set forth in Attachment A of the Auction 77 
Procedures Public Notice.
 iii. Bid Amounts
    54. Bidders will be able to place a bid in any whole dollar amount 
equal to or greater than the minimum bid for the cellular unserved area 
for which they applied.
    55. Bidders are also cautioned that they should type their bid 
amounts carefully because, even if mistakenly or erroneously made, 
bidders still assume a binding obligation to pay their full bid amount.
 iv. Bid Removal and Bid Withdrawal
    56. Bid Removal. Before the close of a bidding round, a bidder has 
the option of removing any bids placed in that round. Once a round 
closes, a bidder may no longer remove a bid. By using the remove bids 
function in the FCC Auction System, a bidder may effectively unsubmit 
any bid placed within that round. This procedure will enhance bidder 
flexibility during the auction, and therefore the Bureau adopts these 
proposals for Auction 77.
    57. Bid Withdrawal. With respect to bid withdrawals, we proposed 
not to allow any bid withdrawals (withdrawal of provisionally winning 
bids from previous rounds) in Auction 77. The Bureau received no 
comments on this issue. Therefore, the Bureau adopts its proposal.
 v. Auction Results
    58. At the end of the bidding round, the winning bid for each 
cellular unserved area will be determined based on the highest bid 
amount received for the area. Bids placed during a round will be made 
public at the conclusion of that round. Specifically, after a round 
closes, the Bureau will compile reports of all bids placed and which 
bidders made them, the random numbers assigned to each bid (for tie-
breaking purposes), new minimum acceptable bid amounts, and will post 
the reports for public access.
    59. In the event of identical high bid amounts being submitted in a 
cellular unserved area (i.e., tied bids), the Bureau proposed to allow 
an additional bidding round or rounds, if necessary, for bidders to 
submit higher bids for the cellular unserved area with tied bids. The 
minimum bid for the next round will be calculated by rounding the tied 
bid amount up to the next $100. The license(s) will be awarded to the 
bidder submitting the highest bid in the additional round. If no bids 
are placed in the additional round, the license(s) will be awarded to 
the bidder that placed the tied bid that was assigned the higher random 
number (a random number having previously been assigned to each bid). 
If there is a tie for the winning bid in the additional round, the FCC 
may add another tie-breaking round or rounds, or stop the auction 
without awarding the license(s).
    60. The Commission will announce the schedule for a subsequent 
round via an announcement in the FCC Auction System, concurrent with 
the release of round results. A commenter stated that it had no 
objection to the proposal to conduct an additional round in the event 
of tied bids. The Bureau believes that this approach is efficient and 
therefore adopts its proposal.
    61. Consistent with past practice, the Bureau will announce the 
winning bid shortly after the close of the auction, and the amounts of 
all bids submitted during the auction will be made publicly available.
 vi. Auction Announcements
    62. The Commission will use auction announcements to announce items 
such as the schedule for a subsequent round in the event of tied bids 
on a license. All auction announcements will be available by clicking a 
link in the FCC Auction System.

V. Post-Auction Procedures

A. Down Payments

    63. After bidding has ended in Auction 77, the Commission will 
issue a public notice declaring the auction closed and identifying 
winning bidders, down payments and final payments due.
    64. 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 licenses offered in Auction 77 to 20 percent of 
the net amount of its winning bids.

B. Final Payments

    65. Each winning bidder will be required to submit the balance of 
the net amount of its winning bids within 10 business days after the 
applicable deadline for submitting down payments.

C. Long-Form Application (FCC Form 601)

    66. Within an MX group, the previously filed long-form 
application(s) (FCC Form 601) of the unsuccessful bidder will be 
dismissed following the grant of the winning bidder's license(s).

D. Ownership Disclosure Information Report (FCC Form 602)

    67. Winning bidders must ensure that ownership information reported 
on FCC Form 602 is accurate and up to date. Further instructions will 
be provided to winning bidders at the close of the auction.

E. Default and Disqualification

    68. Any winning 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 make full payment, or is 
otherwise disqualified) will be subject to the payments described in 47 
CFR 1.2104(g)(2). The payments include both a deficiency payment, equal 
to the difference between the amount of the bidder's bid and the amount 
of the winning bid the next time a license covering substantially the 
same spectrum and geographic area is won in an auction, plus an 
additional payment equal to a percentage of the defaulter's bid or of 
the subsequent winning bid, whichever is less.
    69. The percentage of the bid that a defaulting bidder must pay in 
addition to the deficiency will depend in part on the auction format 
ultimately chosen for a particular auction, if the license is 
subsequently reauctioned. In package auctions without package bidding, 
the amount can range from three percent up to a maximum of twenty 
percent, established in advance of the auction and based on the nature 
of the service and the inventory of the licenses being offered.
    70. As previously noted by the Commission, defaults weaken the 
integrity of the auction process and impede the deployment of service 
to the public, and an additional default payment of more than three 
percent will be more effective in deterring defaults. Accordingly, in 
the Auction 77 Comment Public Notice, the Bureau proposed to set the 
additional default payment for the auction of the two cellular unserved 
areas licenses at twenty percent of the applicable bid. Since Auction 
77 is being conducted strictly to resolve conflicts between entities in 
two cellular unserved areas that were unable to resolve their mutually 
exclusive applications, a default by the winning bidder would suggest 
that the bidder has not made a good-faith effort to abide by FCC 
license assignment procedures, thereby weakening the integrity of the 
auction process. The Bureau proposed to impose the maximum payment 
percentage to deter such behavior. The Bureau

[[Page 26118]]

received no comments on this proposal. Therefore, the Bureau adopts its 
proposal.
    71. Finally, the Bureau notes that in the event of a default, the 
Commission may reauction the license or offer it to the next highest 
bidder (in descending order) at its final bid amount. 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.

F. Refund of Remaining Upfront Payment Balance

    72. All upfront payments submitted by applicants in Auction 77 may 
be available to be refunded after the conclusion of the auction; 
subject to any required payments (i.e. winning bid, deficiency, and/or 
default payments). 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.

    Federal Communications Commission.
Gary D. Michaels,
Deputy Chief, Auctions Spectrum and Access Division, WTB.
 [FR Doc. E8-10381 Filed 5-7-08; 8:45 am]
BILLING CODE 6712-01-P