Federal Communications Commission	DA 21-567



DA 21-567
Released:  May 19, 2021

CERTIFICATION ADOPTED FOR AUCTION OF FLEXIBLE-USE SERVICE LICENSES IN THE 3.45–3.55 GHz BAND FOR NEXT-GENERATION WIRELESS SERVICES (AUCTION 110)

AU Docket No. 21-62

1. By this Public Notice, the Office of Economics and Analytics and the Wireless Telecommunications Bureau adopt a certification that will be required of each applicant to participate in the upcoming auction of flexible-use licenses in the 3.45–3.55 GHz band (Auction 110). Auction of Flexible Use Licenses in the 3.45–3.55 GHz Band For Next Generation Wireless Services; Comment Sought on Competitive Bidding Procedures for Auction 110, AU Docket No. 21-62, Public Notice, FCC 21-33 at 6, para. 12 (rel. Mar. 18, 2021) (Auction 110 Comment Public Notice) (proposing certification for Auction 110 applicants); 47 CFR §§ 0.21(m), 0.331(c) (granting the Office of Economics and Analytics and the Wireless Telecommunications Bureau authority over auction design and implementation issues). 
  Specifically, each applicant for Auction 110 will be required to certify in its short-form application that it has read the public notice describing the procedures for the auction and that it has familiarized itself both with the auction procedures and with the requirements for obtaining a license and operating facilities in the 3.45–3.55 GHz band.  
2. In the Auction 110 Comment Public Notice, the Commission sought comment on a range of proposed procedures for conducting Auction 110, including a proposal to require each participant in Auction 110 to certify in its short-form application, under penalty of perjury, that it has read the public notice adopting procedures for the auction and that it has familiarized itself both with the auction procedures and with the requirements for obtaining a license and operating facilities in the 3.45–3.55 GHz band. Auction 110 Comment Public Notice at 6, para. 12.
  As with other certifications required to be made in an auction application, a failure to make the certification would render the application unacceptable for filing, and the application would be dismissed with prejudice. See 47 CFR § 1.2105(b)(1).
  
3. The Commission proposed to establish this requirement to help ensure that each applicant has reviewed the procedures to become a qualified bidder and participate in the auction process and that it has investigated and assessed technical and business factors that may be relevant to its use of the licenses being offered. Auction 110 Comment Public Notice at 6, para. 12.
  The Commission reasoned that this requirement would promote an applicant’s successful participation and would minimize its risk of auction defaults.  Only one party, The Rural Wireless Association (RWA), filed initial comments addressing the certification proposal, The Rural Wireless Association Comments (RWA Comments).
 and T-Mobile USA, Inc. (T-Mobile) addressed the proposal in its reply comments. T-Mobile USA, Inc. Reply (T-Mobile Reply).
  We are unpersuaded by RWA’s objections to the proposed certification requirement. See RWA Comments at 4-5.
  We strongly disagree with RWA’s assertion that being required to provide a certification under penalty of perjury would be a “draconian” penalty which would be “unrelated to its stated purpose of preventing defaults.” Id. at 4.
  We note that all of the certifications that are currently required of each auction applicant must be made under penalty of perjury, pursuant to the Commission’s rules. 47 C.F.R. § 1.2105(a)(2).
  This proviso is intended to ensure that the applicant has been truthful in making its statement. See, e.g., Implementation of Section 309(j) of the Communications Act—Competitive Bidding, PP Docket No. 93-253, Second Report and Order, 9 FCC Rcd 2348, 2408 (1994) (adopting former section 1.2105(a)(2)(viii) requirement to provide “an exhibit, certified as truthful” which identifies parties to bidding agreements).  See also 47 C.F.R. § 1.2105(a)(2) (“all information, statements, certifications and declarations submitted in the application shall be made under penalty of perjury”). 
  We find no reason to apply a different standard to this certification than we apply to the rest of the short-form application.  As T-Mobile observes in its reply, “the certification is important and consistent with the Commission’s usual direction that bidders must be aware of the nature of the authorizations they seek to acquire and the obligations associated with the licenses the Commission may ultimately issue.” T-Mobile Reply at 5-6. 
  
4. This certification is designed to bolster applicants’ efforts to educate themselves to the greatest extent possible about the procedures for auction participation and to ensure that, prior to submitting their short-form applications, applicants understand their obligation to stay abreast of relevant, forthcoming information.  By ensuring familiarity with the Commission’s rules and procedures governing Auction 110, we are also taking steps to help bidders avoid the consequences to them associated with defaults, as well as the consequences for other applicants, the public, and the Commission associated therewith.  This certification, along with the other certifications required pursuant to section 1.2105(a), helps ensure that auction applicants are sincere about their interest in the auction, and it may discourage the filing of frivolous applications that waste Commission resources.  To the extent that RWA’s concerns are based on potential future marketplace changes that may affect a bidder’s valuation of licenses being offered, we remind each potential applicant that “each potential bidder is solely responsible for investigating and evaluating all technical and marketplace factors that may have a bearing on the potential uses of a license that it may seek in Auction 110.” Auction 110 Comment Public Notice at 3, para. 4.
  
5. Consequently, we also disagree with RWA’s assertion that applicants should not be required to certify as to a familiarity with the rules governing the competitive bidding and licensing for the 3.45–3.55 GHz band because some technical information is not released until after the deadline for filing an auction application and because “technical and marketplace factors can change dramatically over time.” RWA Comments at 5.
  The procedures for each auction are adopted in advance of each filing window, pursuant to the Commission’s rules governing competitive bidding and consistent with a statutory mandate “to ensure that interested parties have a sufficient time to develop business plans, assess market conditions, and evaluate the availability of equipment for the relevant services.” 47 U.S.C. § 309(j)(3)(E)(ii).  
  Likewise, the Commission has adopted service rules governing licensing and operation in this band. See generally Facilitating Shared Use in the 3100-3550 MHz Band, WT Docket No. 19-348, Second Report and Order, Order on Reconsideration, Order of Proposed Modification, FCC 21-32 at 70-88, Appx. A (rel. March 18, 2021) (3.45 GHz Second Report and Order).
  The certification we add refers to information regarding auction procedures and licensing that is available at the time of the certification, including in documents such as these.  
6. Typically, the auction procedures note that “applicants must be thoroughly familiar with the procedures, terms, and conditions contained in [the Procedures] Public Notice and any future public notices that may be released in [the auction] proceeding.” Auction of Flexible Use Licenses in the 3.7–3.98 GHz Band for Next-Generation Wireless Services; Notice and Filing Requirements, Minimum Opening Bids, Upfront Payments, and Other Procedures for Auction 107; Bidding in Auction 107 Scheduled to Begin December 8, 2020, AU Docket No. 20-25, Public Notice, 35 FCC Rcd 8404, 8407, para. 5. (2020) (Auctions 107 Procedures Public Notice).
  Accordingly, applicants are on notice that their educational efforts must continue.  Commission staff routinely makes available detailed educational materials, such as interactive, online tutorials and technical guides, to enhance interested parties’ comprehension of the pre-bidding and bidding processes and to help minimize the need for applicants to rely upon engineers, legal counsel, or other auction experts. We reject RWA’s contention that “a major cause of defaults is a lack of knowledge prior to the short-form stage” and its implication that Commission staff has supplied inadequate auction outreach and educational materials on the auction process.  RWA Comments at 5.  RWA does not explain the basis for this contention, nor does it describe what further outreach or education might be helpful to its members.  The Commission’s previous observation that this certification would minimize risk of auction defaults was based on its belief that it would reinforce efforts by potential auction applicants to undertake significant due diligence efforts prior to applying for the auction.  Auction 110 Comment Public Notice, FCC 21-33 at 6, para. 12. 
  That detailed educational information also includes links to auction-specific Commission releases, email links for contacting Commission staff, and screen shots of the online application.  In addition, potential applicants are encouraged to contact Commission staff with any questions on the procedures for any upcoming auction.  Our intent is to continue this practice for Auction 110.  
7. For these reasons, we will require each Auction 110 applicant to certify as follows in its short-form application:
that the applicant has read the public notice adopting procedures for the auction and that it has familiarized itself both with the auction procedures and with the requirements for obtaining a license and operating facilities in the 3.45–3.55 GHz band.
An applicant will provide this certification under penalty of perjury, consistent with section 1.2105(a) of the Commission’s rules.
8. This action is taken by the Office of Economics and Analytics, jointly with the Wireless Telecommunications Bureau, pursuant to sections 0.21(m) and 0.131(c) of the Commission’s rules. 47 CFR §§ 0.21(m), 0.131(c). 
  This requirement is an information collection that is subject to approval by the Office of Management and Budget (OMB), pursuant to the Paperwork Reduction Act of 1995, Public Law 104-13. 44 U.S.C. §§ 3501, et seq.  Accordingly, this requirement will apply to applicants for Auction 110 only if it has been approved by OMB and notice of such approval has been published in the Federal Register prior to the opening of the short-form application window for Auction 110.  See Auction 110 Comment Public Notice at 6, n.29.  Our adoption of this requirement in this Public Notice is intended to permit sufficient time for these steps to occur prior to the opening of the short-form application window for Auction 110.  
  
9. Supplemental Final Regulatory Flexibility Analysis.  As required by the Regulatory Flexibility Act of 1980, as amended (RFA), 5 U.S.C. § 603.  The Regulatory Flexibility Act, 5 U.S.C. §§ 601-612, has been amended by the Small Business Regulatory Enforcement Fairness Act of 1996, Pub. L. No. 104-121, Title II, 110 Stat. 857 (1996). 
 a Supplemental Initial Regulatory Flexibility Analysis (Supplemental IRFA) was incorporated in the Auction 110 Comment Public Notice released in March 2021.  The Commission sought public comment on the proposals in the Auction 110 Comment Public Notice, including comments on the Supplemental IRFA.  The Rural Wireless Association, Inc. (RWA) filed comments specifically addressing the Supplemental IRFA, among other things. See RWA Comments at 8.
  This Public Notice establishes a certification requirement to be used for Auction 110 and supplements the Initial and Final Regulatory Flexibility Analyses completed by the Commission in the 3.1–3.55 GHz R&O and FNPRM, 3.45 GHz Second Report and Order, and other Commission orders pursuant to which Auction 110 will be conducted. See Facilitating Shared Use in the 3100-3550 MHz Band, WT Docket No. 19-348, Report and Order and Further Notice of Proposed Rulemaking, 35 FCC Rcd 11078, Appx. B, paras. 1-27 (2020) (3.1-3.55 GHz R&O and FNPRM); 3.45 GHz Second Report and Order at 89-101, paras. 1-30, Appx. B. 
  The Public Notice also addresses RWA’s comments pertaining to the certification requirement adopted herein.  This present Supplemental Final Regulatory Flexibility Analysis (Supplemental FRFA) conforms to the RFA. See 5 U.S.C. § 604.
  
10. Need for, and Objectives of, the Rules.  This Public Notice implements an element of the auction procedures for those entities that seek to bid to acquire licenses in Auction 110, which will be the Commission’s third auction of mid-band spectrum in furtherance of the deployment of fifth-generation (5G) wireless, the Internet of things (IoT), and other advanced spectrum-based services.    
11. To promote the efficient and fair administration of the competitive bidding process for all Auction 110 participants, we adopt a procedure requiring each Auction 110 applicant to certify that it has read the public notice adopting procedures for the auction and that it has familiarized itself both with the auction procedures and with the requirements for obtaining a license and operating facilities in the 3.45–3.55 GHz band, consistent with the proposal made in the Auction 110 Comment Public Notice.
12. This requirement is an element of the more specific implementation of the competitive bidding rules contemplated by Parts 1 and 27 of the Commission’s rules and the underlying rulemaking decisions regarding the 3.45–3.55 GHz band, including the 3.45 GHz Second Report and Order,  See generally Competitive Bidding Second Report and Order, 9 FCC Rcd at 2360-75, paras. 68-159. 
 and relevant competitive bidding orders, and are fully consistent therewith.
13. Summary of Significant Issues Raised by Public Comments in Response to the Supplemental IRFA.  One party—the RWA—filed comments that address issues raised in the Supplemental IRFA.  RWA argues that the Commission’s analysis in the Auction 110 Comment Public Notice’s Supplemental IRFA underestimates the costs that small and rural entities incur when participating in a Commission auction.  RWA states that, contrary to the Commission’s expectations, See Auction 110 Comment Public Notice at 29-30, para. 111. 
 RWA members “regularly consult attorneys, engineers, and consultants to participate in Commission auctions,” incurring costs of $100,000 on average per auction. RWA Comments at 8-9.
  RWA provides no support for this cost figure.  Nor does RWA clarify what portion of this figure represents costs associated with applying to participate in the auction and/or whether the figure may be an aggregate amount for all of its trade association members.  RWA claims that the educational materials provided by the Commission are insufficient, as some materials are not provided until after the short-form application deadline. Id. at 9.
  RWA also contends that the proposed certification requirements do not meet their intended purpose.
14. Response to Comments by the Chief Counsel for Advocacy of the Small Business Administration.  Pursuant to the Small Business Jobs Act of 2010, which amended the RFA, the Commission is required to respond to any comments filed by the Chief Counsel for Advocacy of the SBA and to provide a detailed statement of any changes made to the proposed procedures as a result of those comments. 5 U.S.C. § 604(a)(3).
  The Chief Counsel did not file any comments in response to the procedures that were proposed in the Auction 110 Comment Public Notice.
15. Description and Estimate of the Number of Small Entities to Which the Rules Will Apply.  The RFA directs agencies to provide a description of, and, where feasible, an estimate of the number of small entities that may be affected by the rules and policies adopted herein. Id.
  The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” Id. § 601(6).
  In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. Id. § 601(3) (incorporating by reference the definition of “small business concern” in the Small Business Act, 15 U.S.C. § 632).  Pursuant to 5 U.S.C. § 601(3), the statutory definition of a small business applies “unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register.”
  A “small business concern” is one which:  (1) is independently owned and operated, (2) is not dominant in its field of operation, and (3) satisfies any additional criteria established by the SBA. 15 U.S.C. § 632.
  
16. As noted above, Regulatory Flexibility Analyses were incorporated into the 3.1–3.55 GHz R&O and FNPRM and the 3.45 GHz Second Report and Order.  See 3.1–3.55 GHz R&O and FNPRM, Appx. E, 35 FCC Rcd at 11154-58, paras. 6-15; 3.45 GHz Second Report and Order at 90-95, paras. 9-18, Appx. B.
  These decisions provide the underlying authority for the procedures proposed in the Auction 110 Comment Public Notice and are adopted herein for Auction 110.  In those regulatory flexibility analyses, the Commission described in detail the small entities that might be significantly affected.  In this Public Notice, we hereby incorporate by reference the descriptions and estimates of the number of small entities from the previous Regulatory Flexibility Analyses in the 3.1–3.55 GHz R&O and FNPRM and the 3.45 GHz Second Report and Order. Id.

17. Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements for Small Entities.  The Commission designed its auction application process to minimize reporting and compliance requirements for small businesses and other applicants.  In the first part of the Commission’s two-stage auction application process, parties desiring to participate in an auction file a streamlined, short-form application in which they certify under penalty of perjury as to their qualifications. See Competitive Bidding Second Report and Order, 9 FCC Rcd at 2376-77, paras. 163-66.
  Eligibility to participate in an auction is based on an applicant’s short-form application and certifications, as well as its upfront payment.  This Public Notice adds to the existing certifications that are required under the Commission’s competitive bidding rules a requirement for a certification on the short-form application, under penalty of perjury, that the applicant has read the public notice adopting the procedures for the auction and has familiarized itself both with the auction procedures and with the requirements for obtaining a license and operating facilities in the 3.45–3.55 GHz band. Auction 110 Comment Public Notice at 6, para. 12.
  This requirement is specific to Auction 110. 47 CFR § 1.2105.
  Consistent with other certifications required in an auction application, a failure to make this certification would render an application unacceptable for filing, and the application would be dismissed with prejudice. See id. § 1.2105(b)(1).
  
18. Typically, the auction procedures inform prospective applicants that they should familiarize themselves with the Commission’s general competitive bidding rules, Commission decisions regarding competitive bidding procedures, application requirements, obligations of Commission licensees, and the Commission’s service rules for the frequency band available in the auction, and that they must be thoroughly familiar with the procedures, terms, and conditions contained in the public notice adopting procedures for the auction. See, e.g., Auctions 107 Procedures Public Notice, 35 FCC Rcd at 8407, para. 5; Auction of Priority Access Licenses in the 3550-3650 GHz Band; Notice and Filing Requirements, Minimum Opening Bids, Upfront Payments, and Other Procedures for Auction 105; Bidding in Auction 105 Scheduled to Begin June 25, 2020, AU Docket No. 19-244, Public Notice, 35 FCC Rcd 2140, 2143, para. 5 (2020).
  We therefore do not expect that the certification requirement adopted in this Public Notice will increase the need for small entities to hire attorneys, engineers, consultants, or other professionals because it does not increase the level of education or due diligence beyond what was required of applicants prior to the adoption of the certification requirement, and thus it should not increase an applicant’s burden in complying with the additional certification requirement.  A second public notice adopting the procedures for Auction 110 will be released before the short-form filing deadline and made publicly available on the Auction 110 web page.  We note that the 3.45 GHz Second Report and Order adopting the requirements for obtaining a license and operating facilities in the 3.45–3.55 GHz band is already publicly available on both the Commission’s main website and the Auction 110 web page. See Federal Communication Commission, Office of Economics and Analytics, Auction 110: 3.45 GHz Service website, www.fcc.gov/auction/110. 
  We believe that these materials are sufficient to ensure that Auction 110 applicants can certify truthfully that they have read the auction procedures and familiarized themselves with the relevant rules and requirements.
19. As noted above, RWA argues that the Commission underestimates the burden of participating in an auction, particularly for small and rural providers. RWA Comments at 8-9.
  In particular, RWA points to the need for small entities to hire attorneys, engineers, and other consultants, at a cost of $100,000 on average per auction. Id.  As noted above, RWA provides no specific evidence in support of its claim that RWA members spend an average of $100,000 per auction on outside consultants. 
  RWA does not, however, provide evidence to support its claim that outside consultants are needed to enable an entity to certify truthfully that it has read the public notice adopting the procedures for the auction and that it has familiarized itself both with the auction procedures and with the requirements for obtaining a license and operating facilities in the 3.45–3.55 GHz band.  Instead, RWA claims that small entity bidders “cannot make complex decisions on the future impacts of auction bidding, participation, and winning bidder compliance requirements without outside counsel.” Id. at 9.
  In doing so, RWA appears to conflate compliance with auction procedures (in this case, certifying that they have read the public notice adopting procedures for Auction 110 and familiarized themselves with those procedures and the service rules for the 3.45–3.55 GHz band) with the development of bidding strategies and compliance with the relevant service rules.  We do not believe that outside consultants of this sort are necessary for an applicant to comply with this certification requirement.  Further, this requirement is intended to ensure that the applicant itself is familiar with the procedures and requirements so that it understands the consequences of its actions, regardless of whether such actions may have been undertaken pursuant to any advice from attorneys, engineers, or other consultants.
20. Steps Taken to Minimize the Significant Economic Impact on Small Entities, and Significant Alternatives Considered.  The RFA requires an agency to describe any significant, specifically small business, alternatives that it has considered in reaching its approach, which may include the following four alternatives (among others):  “(1) the establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance and reporting requirements under the rule for such small entities; (3) the use of performance rather than design standards; and (4) an exemption from coverage of the rule, or any part thereof, for such small entities.” 5 U.S.C. § 604(a)(6).
 
21. The Commission has taken steps to minimize any economic impact of the certification requirement on small entities through, among other things, the many free resources we provide to potential auction participants.  As mentioned above, consistent with the past practices in prior auctions, small entities that are potential participants already have access to the 3.45 GHz Second Report and Order detailing licensing and operating requirements for the 3.45–3.55 GHz band on both the Commission’s main website and the Auction 110 web page.  Potential applicants will also have access to the public notice adopting the procedures for Auction 110 prior to the opening of the application window, and we believe that a careful reading of these materials will be sufficient for applicants to certify truthfully that they have familiarized themselves with the auction procedures and service rules for the 3.45–3.55 GHz band.  Further, we intend to release an online tutorial that will help applicants understand the procedures for filing the auction short-form application (FCC Form 175). While additional educational materials that are specific to the bidding process will not be released until after the short-form application deadline, we do not believe that these supplemental materials, while helpful, are necessary for purposes of the certification.
  The Commission makes this information publicly available and easily accessible and without charge to benefit all potential Auction 110 applicants, including small entities, thereby lowering their administrative costs to comply with the Commission’s competitive bidding rules.  
22. Small entities and other auction participants may seek clarification of, or guidance regarding, the Auction 110 procedures and the service rules for the 3.45–3.55 GHz band rules prior to the Auction 110 application window.  Additionally, an FCC Auctions Hotline will provide small entities one-on-one access to Commission staff for information about the auction process and procedures.  The FCC Auctions Technical Support Hotline is another resource that provides technical assistance to applicants, including small entities, on issues such as access to or navigation within the electronic FCC Form 175 and use of the bidding system. RWA contends that the legal advice provided by FCC staff is inadequate because it cannot be relied upon, and therefore small entities must rely on outside assistance.  RWA Comments at 9.  Reliance on outside counsel, however, does not protect an auction participant from the consequences of any errors.
  
23. The Commission also makes various databases and other sources of information, including the auctions program web pages and copies of Commission decisions, available to the public without charge, providing a low-cost mechanism for small entities to conduct research prior to and throughout the auction.  We do not believe it necessary to “significantly increase [our] auction outreach and education efforts, and release all auction materials well before the short-form filing deadline to better enable prospective applicants to make informed decisions,” as RWA requests. RWA Comments at 5.
  While RWA does not give any examples of “informed decisions” that an applicant must make prior to certification for which additional information is needed, we infer from their comments that RWA believes that an applicant will be required to have a bidding strategy and/or business plan in place prior to making the certification adopted here.  That is not the case.  As already explained, an applicant need only be familiar with the information that will be provided prior to the application deadline, and thus no significant outreach or additional educational materials are necessary.
24.  The certification requirement adopted for the conduct of Auction 110 constitutes the more specific implementation of the competitive bidding rules contemplated by Parts 1 and 27 of the Commission’s rules and the underlying rulemaking decisions regarding the 3.45–3.55 GHz band, including the 3.45 GHz Second Report and Order and relevant competitive bidding decisions, and are fully consistent therewith. See generally Competitive Bidding Second Report and Order, 9 FCC Rcd at 2360-75, paras. 68-159. 

25. Report to Congress.  The Commission will send a copy of this Auction 110 Certification Requirement Public Notice, including the Supplemental FRFA, in a report to Congress pursuant to the Congressional Review Act. See 5 U.S.C. § 801(a)(1)(A).
  In addition, the Commission will send a copy of this Auction 110 Certification Requirement Public Notice, including the Supplemental FRFA, to the Chief Counsel for Advocacy of the SBA.  A copy of this Auction 110 Certification Requirement Public Notice, and Supplemental FRFA (or summaries thereof), will also be published in the Federal Register. See id. § 604(b). 

26. Interested parties should continue to monitor the Auction 110 web page (www.fcc.gov/auction/110) for any future announcements regarding the auction schedule and other important auction information.  For further information, contact Mary Lovejoy or Andrew McCardell of the Office of Economics and Analytics, Auctions Division at (202) 418-0660 or auction110@fcc.gov.  To request materials in accessible formats (Braille, large print, electronic files, audio format) for people with disabilities, send an email to fcc504@fcc.gov or call the Consumer and Governmental Affairs Bureau at (202) 418-0530 or (202) 418-0432 (TTY).

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