*Pages 1--6 from Microsoft Word - 56147.doc* PUBLIC NOTICE Federal Communications Commission 445 12th St., S. W. Washington, D. C. 20554 News Media Information 202 / 418- 0500 Internet: http:// www. fcc. gov TTY: 1- 888- 835- 5322 DA 06- 701 March 31, 2006 AUCTION OF 800 MHz AIR- GROUND RADIOTELEPHONE SERVICE LICENSES Status of FCC Form 175 Applications to Participate in Auction No. 65 Report No. AUC- 06- 65- E (Auction No. 65) The Wireless Telecommunications Bureau (“ Bureau”) of the Federal Communications Commission (“ Commission”) has received 12 short- form applications (FCC Forms 175) to participate in the upcoming auction of new nationwide commercial Air- Ground Radiotelephone Service licenses in the 800 MHz band (Auction No. 65) which is scheduled to begin on Wednesday, May 10, 2006. 1 The applications have been reviewed for completeness and compliance with the Commission’s rules, and have been classified into the categories listed below. Application Categories: ACCEPTED FOR FILING........................................................... 5 applications INCOMPLETE .............................................................................. 7 applications Accepted: Applications accepted for filing are listed alphabetically in Attachment A. These applicants will become qualified bidders upon receipt of the required upfront payment due before 6: 00 p. m. Eastern Time (ET) on Monday, April 17, 2006. 2 With respect to the FCC Form 175 application, these applicants need to take no further action except as may be necessary to maintain the accuracy of their applications. 3 Attachment A also indicates the licenses selected by each applicant on its short- form application. 1 See “Auction of 800 MHz Air- Ground Radiotelephone Service Licenses Scheduled for May 10, 2006, Notice and Filing Requirements, Minimum Opening Bids, Upfront Payments and Other Procedures for Auction No. 65,” Public Notice, DA 06- 299 (rel. Feb. 21, 2006) (“ Auction No. 65 Procedures Public Notice"); see also “Auction of 800 MHz Air- Ground Radiotelephone Service Licenses Scheduled For May 10, 2006, Additional Default Payment of 20 Percent Will Apply to Auction No. 65,” Public Notice, DA 06- 588 (rel. March 20, 2006). 2 See 47 C. F. R. § 1.2106. 3 See 47 C. F. R. § 1.65. 1 2 Incomplete: Applications found to be incomplete or deficient are listed alphabetically in Attachment B. Those applicants will receive overnight correspondence indicating what information is required to make their applications acceptable for filing. These applicants may become qualified bidders only if they complete before 6: 00 p. m. ET on Monday, April 17, 2006, the following actions: (1) make the required upfront payments; and (2) resubmit their application, having corrected the deficiencies indicated. Applicants also must maintain the accuracy of their short- form applications as required by the Commission’s rules. 4 The filing window for resubmitting short- form applications is now open and ends at 6: 00 p. m. ET on Monday, April 17, 2006. This will be the only opportunity to cure specified FCC Form 175 defects; late resubmissions will not be accepted. In addition, if an application remains incomplete or otherwise deficient after the resubmission deadline has passed, the application will be dismissed. 1. UPFRONT PAYMENT DEADLINE Upfront payments and accompanying FCC Remittance Advice forms (FCC Form 159) for Auction No. 65 are due in the proper account at Mellon Bank, Pittsburgh, Pennsylvania, not later than 6: 00 p. m. ET on Monday, April 17, 2006. In order to meet the Commission’s upfront payment deadline, an applicant’s payment must be credited to the Commission’s account by the deadline. 5 Payments must be made by wire transfer in accordance with the instructions provided in the Auction No. 65 Procedures Public Notice. 6 No other payment method is acceptable for this auction. Applicants are reminded to provide their FCC Registration Number (“ FRN”) on the FCC Form 159. At least one hour before placing the order for the wire transfer (but on the same business day), applicants must send by facsimile a completed FCC Form 159 (revised February 2003) to Mellon Bank at (412) 209- 6045. Applicants that have filed applications deemed to be incomplete or deficient, as noted in Attachment B to this public notice, must submit timely and sufficient upfront payments before the Commission will review their submitted applications. In order to bid on a license, qualified bidders that applied for any or all licenses on FCC Form 175 must have eligibility of 100,000 bidding units. Therefore, an applicant that is not a former defaulter must submit a total upfront payment of $100,000 in order to have 100, 000 bidding units, or else the applicant will not be eligible to participate in the auction. An applicant that is a former defaulter must submit an upfront payment of $150,000 in order to have 100,000 bidding units. If a former defaulter fails to submit an upfront payment of $150,000, the applicant will not be eligible to participate in the auction. 7 If no upfront payment is made, or the application remains incomplete or deficient following its resubmission, the application will be dismissed. If the applicant has provided its FRN and wire transfer instructions from the payor of record, any upfront payment made prior to dismissal will be refunded in a timely manner upon request. Applicants are responsible for obtaining confirmation from their financial institution that Mellon Bank has timely received their upfront payment and deposited it in the proper account. We remind applicants that to avoid untimely upfront payments they should discuss arrangements (including transfer 4 See 47 C. F. R. § 1.65 (an applicant must maintain the accuracy and completeness of information furnished in its pending application and notify the Commission within 30 days of any substantial change that may be of decisional significance to that application), 47 C. F. R. § 1.2105( c)( 6) (any applicant that makes or receives a prohibited communication must report such communication in writing to the Commission no later than five business days after the communication occurs). 5 See Letter from Margaret W. Wiener, Chief, Auctions and Industry Analysis Division, Wireless Telecommunications Bureau, to Patrick Shannon, Esq., Counsel for Lynch 3G Communications Corporation, 18 FCC Rcd 11552 (WTB Auc. Div. 2003). 6 See Auction No. 65 Procedures Public Notice at 24- 26. 7 47 C. F. R. § 1.2106( a). 2 3 times and bank closing schedules) with their financial institution several days before making the wire transfer, and allow sufficient time for the transfer to be initiated and completed before the deadline. Detailed information regarding upfront payments, including additional requirements for “former defaulters,” can be found in the Auction No. 65 Procedures Public Notice under Section II. F. and Section III. D. 8 Note: Applicants are reminded to submit the same FRN with all future payments for Auction No. 65. 2. OTHER IMPORTANT INFORMATION Qualified Bidders: Approximately two weeks after the upfront payment deadline, following Commission review of resubmitted short- form applications and correlation of payments and applications, a public notice listing all applicants qualified to bid in the auction will be released (Qualified Bidders Public Notice). The Qualified Bidders Public Notice will also include bidding schedules for both the mock auction and the first day of Auction No. 65. Due Diligence: Potential bidders are reminded that they are solely responsible for investigating and evaluating all technical and marketplace factors that may have a bearing on the value of the 800 MHz Air-Ground Radiotelephone Service licenses in this auction. The Commission makes no representations or warranties about the use of this spectrum for particular services. Potential bidders are strongly encouraged to conduct their own research prior to the beginning of bidding in Auction No. 65 in order to determine the existence of pending proceedings, pleadings, applications, or authorizations that might affect their decisions regarding participation in the auction. Participants in Auction No. 65 are strongly encouraged to continue such research during 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 comply fully with the Commission's technical and legal requirements. For further details regarding due diligence, please refer to the Auction No. 65 Procedures Public Notice under Section I. B. 6. 9 Prohibition of Collusion: Applicants are reminded that Section 1.2105( c) of the Commission’s rules prohibits applicants for any of the same geographic license areas from communicating with each other about bids, bidding strategies, or settlements unless they have identified each other on their short- form applications as parties with which they have entered into agreements under Section 1.2105( a)( 2)( viii). 10 Because all of the licenses available in Auction No. 65 have the same service area, i. e., they are nationwide, this prohibition will apply to all applicants. Thus, all applicants (unless they have identified each other on their short- form applications as parties with whom they have entered into agreements under Section 1.2105( a)( 2)( viii)) must affirmatively avoid all communications with or disclosures to each other that affect or have the potential to affect bids or bidding strategy, which may include communications regarding the post- auction market structure. 11 For Auction No. 65, this prohibition became effective at the short- form application filing deadline on March 24, 2006, and will end at the post- auction down payment deadline, which will be announced in a future public notice. 12 This prohibition applies to all 8 See id.; Auction No. 65 Procedures Public Notice at 20- 22 and 24- 26. 9 See Auction No. 65 Procedures Public Notice at 10- 12. 10 47 C. F. R. §§ 1. 2105( a)( 2)( viii), 1. 2105( c)( 1), 73. 5002( d). See also Amendment of Part 1 of the Commission’s Rules — Competitive Bidding Procedures, WT Docket No. 97- 82, Seventh Report and Order, 16 FCC Rcd 17546 (2001) (“ Part 1 Seventh Report and Order”); id., Order on Reconsideration of the Third Report and Order, Fifth Report and Order, and Fourth Further Notice of Proposed Rule Making, 15 FCC Rcd 15293, 15297- 98 ¶¶ 7- 8 (2000) (“ Part 1 Fifth Report and Order”). 11 See, e. g., “Wireless Telecommunications Bureau Provides Guidance on the Anti- Collusion Rule for D, E and F Block Bidders,” Public Notice, DA 96- 1460 (rel. August 28, 1996). 12 47 C. F. R. § 1.2105( c)( 1). 3 4 applicants regardless of whether such applicants become qualified bidders or actually bid. 13 For purposes of this prohibition, Section 1.2105( c)( 7)( i) defines “applicant” as including all officers and directors of the entity submitting a short- form application to participate in the auction, all controlling interests of that entity, as well as all holders of partnership and other ownership interests and any stock interest amounting to 10 percent or more of the entity, or outstanding stock, or outstanding voting stock of the entity submitting a short- form application. 14 We note that a violation of the anti- collusion rule could occur when an individual serves as an officer and/ or director for two or more competing applicants. 15 If parties had agreed in principle on all material terms of a bidding agreement( s), those parties must have been identified on the short- form application under Section 1.2105( c), even if the agreement had not been reduced to writing. If parties had not agreed in principle by the short- form application filing deadline on March 24, 2006, an applicant should not have included the names of those parties on its application, and must not have continued negotiations. 16 Bidders competing for licenses for any of the same geographic license areas must not communicate directly or indirectly about bids or bidding strategy. 17 Applicants are encouraged not to use the same individual as an authorized bidder. A violation of the anti- collusion rule could occur if an individual acts as the authorized bidder for two or more competing applicants, and conveys information concerning the substance of bids or bidding strategies between the bidders he or she is authorized to represent in the auction. 18 Also, if the authorized bidders are different individuals employed by the same organization (e. g., law firm or consulting firm), a violation could likewise occur. In such a case, at a minimum, applicants should take precautionary steps to prevent communication between authorized bidders and that applicants and their bidding agents will comply with the anti- collusion rule. 19 However, the Bureau cautions that the mere existence of precautionary measures will not outweigh specific evidence that collusive behavior has occurred, nor will it preclude the initiation of an investigation when warranted. 20 In addition, Section 1.65 of the Commission’s rules requires an applicant to maintain the accuracy and completeness of information furnished in its pending application and to notify the Commission within 30 days of any substantive change that may be of decisional significance to that application. 21 Thus, Section 1.65 requires auction applicants that engage in communication of bids or bidding strategies that results in a bidding agreement, arrangement, or understanding not already identified on their short- form applications to promptly disclose any such agreement, arrangement, or understanding to the Commission 13 See, e. g., Northeast Communications of Wisconsin, LLC, Forfeiture Order, 19 FCC Rcd 18635 (EB 2004) (imposing forfeiture in the amount of $100, 000 for violation of the anti- collusion rule, even though the applicant never made an upfront payment for the auction and was not listed as a qualified bidder); Letter to Robert Pettit, Esquire, from Margaret W. Wiener, Chief, Auctions and Industry Analysis Div., 16 FCC Rcd 10080 (WTB Auc. Div. 2000) (declining to exempt an applicant’s controlling interest from coverage by the anti- collusion rule, even though the applicant never made an upfront payment for the auction and was not listed as a qualified bidder). 14 47 C. F. R. § 1.2105( c)( 7)( i). 15 See Letter to Colby M. May from Barbara A. Kreisman and Margaret W. Wiener, 20 FCC Rcd 14648 (Video and Auc. Divs. 2005) (finding apparent violation of anti- collusion rule where applicants with mutually exclusive applications reported sharing same individual as an officer and director and reported no bidding agreement). 16 See Wireless Telecommunications Bureau Clarifies Spectrum Auction Anti- Collusion Rules, Public Notice, 11 FCC Rcd 9645 (WTB 1995). 17 Part 1 Seventh Report and Order, 16 FCC Rcd at 17540- 50 ¶ 6. 18 See Auction No. 65 Procedures Public Notice at 7. 19 See Application of Nevada Wireless for a License to Provide 800 MHz Specialized Mobile Radio Service in the Farmington, NM- CO Economic Area (EA- 155) Frequency Band A, Memorandum Opinion and Order, 13 FCC Rcd 11973, 11977 ¶ 11 (1998). 20 Id., 13 FCC Rcd at 11978 ¶ 13. 21 47 C. F. R. § 1.65. 4