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e-CFR data is current as of October 27, 2020

Title 47Chapter ISubchapter APart 1 → Subpart AA


Title 47: Telecommunication
PART 1—PRACTICE AND PROCEDURE


Subpart AA—Competitive Bidding for Universal Service Support


Contents
§1.21000   Purpose.
§1.21001   Participation in competitive bidding for support.
§1.21002   Prohibition of certain communications during the competitive bidding process.
§1.21003   Competitive bidding process.
§1.21004   Winning bidder's obligation to apply for support

Source: 76 FR 73851, Nov. 29, 2011, unless otherwise noted.

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§1.21000   Purpose.

This subpart sets forth procedures for competitive bidding to determine the recipients of universal service support pursuant to part 54 of this chapter and the amount(s) of support that each recipient respectively may receive, subject to post-auction procedures, when the Commission directs that such support shall be determined through competitive bidding.

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§1.21001   Participation in competitive bidding for support.

(a) Public Notice of the Application Process. The dates and procedures for submitting applications to participate in competitive bidding pursuant to this subpart shall be announced by public notice.

(b) Application Contents. An applicant to participate in competitive bidding pursuant to this subpart shall provide the following information in an acceptable form:

(1) The identity of the applicant, i.e., the party that seeks support, including any required information regarding parties that have an ownership or other interest in the applicant;

(2) The identities of up to three individuals authorized to make or withdraw a bid on behalf of the applicant;

(3) The identities of all real parties in interest to any agreements relating to the participation of the applicant in the competitive bidding;

(4) Certification that the application discloses all real parties in interest to any agreements involving the applicant's participation in the competitive bidding;

(5) Certification that the applicant and all applicable parties have complied with and will continue to comply with §1.21002;

(6) Certification that the applicant is in compliance with all statutory and regulatory requirements for receiving the universal service support that the applicant seeks, or, if expressly allowed by the rules specific to a high-cost support mechanism, a certification that the applicant acknowledges that it must be in compliance with such requirements before being authorized to receive support;

(7) Certification that the applicant will make any payment that may be required pursuant to §1.21004;

(8) Certification that the individual submitting the application is authorized to do so on behalf of the applicant; and

(9) Such additional information as may be required.

(c) Financial Requirements for Participation. As a prerequisite to participating in competitive bidding, an applicant may be required to post a bond or place funds on deposit with the Commission in an amount based on the default payment that may be required pursuant to §1.21004. The details of and deadline for posting such a bond or making such a deposit will be announced by public notice. No interest will be paid on any funds placed on deposit.

(d) Application Processing. (1) Any timely submitted application will be reviewed by Commission staff for completeness and compliance with the Commission's rules. No untimely applications shall be reviewed or considered.

(2) An applicant will not be permitted to participate in competitive bidding if the application does not identify the applicant as required by the public notice announcing application procedures or does not include all required certifications, as of the deadline for submitting applications.

(3) An applicant will not be permitted to participate in competitive bidding if the applicant has not provided any bond or deposit of funds required pursuant to §1.21001(c), as of the applicable deadline.

(4) An applicant may not make major modifications to its application after the deadline for submitting the application. An applicant will not be permitted to participate in competitive bidding if Commission staff determines that the application requires major modifications to be made after that deadline. Major modifications include, but are not limited to, any changes in the ownership of the applicant that constitute an assignment or transfer of control, or any changes in the identity of the applicant, or any changes in the required certifications.

(5) An applicant may be permitted to make minor modifications to its application after the deadline for submitting applications. Minor modifications may be subject to a deadline specified by public notice. Minor modifications include correcting typographical errors and supplying non-material information that was inadvertently omitted or was not available at the time the application was submitted.

(6) After receipt and review of the applications, an applicant that will be permitted participate in competitive bidding shall be identified in a public notice.

[76 FR 73851, Nov. 29, 2011, as amended at 81 FR 44448, July 7, 2016]

Effective Date Note: At 81 FR 44448, July 7, 2016, §1.21001(b)(6) was revised. This paragraph contains information collection and recordkeeping requirements and will not become effective until approval has been given by the Office of Management and Budget.

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§1.21002   Prohibition of certain communications during the competitive bidding process.

(a) Definition of Applicant. For purposes of this paragraph, the term “applicant” shall include any applicant, each party capable of controlling the applicant, and each party that may be controlled by the applicant or by a party capable of controlling the applicant.

(b) Certain Communications Prohibited. After the deadline for submitting applications to participate, an applicant is prohibited from cooperating or collaborating with any other applicant with respect to its own, or one another's, or any other competing applicant's bids or bidding strategies, and is prohibited from communicating with any other applicant in any manner the substance of its own, or one another's, or any other competing applicant's bids or bidding strategies, until after the post-auction deadline for winning bidders to submit applications for support, unless such applicants are members of a joint bidding arrangement identified on the application pursuant to §1.21001(b)(4).

(c) Duty To Report Potentially Prohibited Communications. An applicant that makes or receives communications that may be prohibited pursuant to this paragraph shall report such communications to the Commission staff immediately, and in any case no later than 5 business days after the communication occurs. An applicant's obligation to make such a report continues until the report has been made.

(d) Procedures for Reporting Potentially Prohibited Communications. Particular procedures for parties to report communications that may be prohibited under this rule may be established by public notice. If no such procedures are established by public notice, the party making the report shall do so in writing to the Chief of the Auctions and Spectrum Access Division by the most expeditious means available, including electronic transmission such as email.

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§1.21003   Competitive bidding process.

(a) Public Notice of Competitive Bidding Procedures. Detailed competitive bidding procedures shall be established by public notice prior to the commencement of competitive bidding any time competitive bidding is conducted pursuant to this subpart.

(b) Competitive Bidding Procedures—Design Options. The public notice detailing competitive bidding procedures may establish the design of the competitive bidding utilizing any of the following options, without limitation:

(1) Procedures for Collecting Bids. (i) Procedures for collecting bids in a single round or in multiple rounds.

(ii) Procedures for collecting bids on an item-by-item basis, or using various aggregation specifications.

(iii) Procedures for collecting bids that specify contingencies linking bids on the same item and/or for multiple items.

(iv) Procedures allowing for bids that specify a support level, indicate demand at a specified support level, or provide other information as specified by the Commission.

(v) Procedures to collect bids in one or more stage or stages, including for transitions between stages.

(2) Procedures for Assigning Winning Bids. (i) Procedures for scoring bids by factors in addition to bid amount, such as population coverage or geographic contour, or other relevant measurable factors.

(ii) Procedures to incorporate public interest considerations into the process for assigning winning bids.

(3) Procedures for Determining Payments. (i) Procedures to determine the amount of any support for which winning bidders may become authorized, consistent with other auction design choices.

(ii) Procedures that provide for support amounts based on the amount as bid or on other pricing rules, either uniform or discriminatory.

(c) Competitive Bidding Procedures—Mechanisms. The public notice detailing competitive bidding procedures may establish any of the following mechanisms, without limitation:

(1) Limits on Available Information. Procedures establishing limits on the public availability of information regarding applicants, applications, and bids during a period of time covering the competitive bidding process, as well as procedures for parties to report the receipt of non-public information during such periods.

(2) Sequencing. Procedures establishing one or more groups of eligible areas and if more than one, the sequence of groups for which bids will be accepted.

(3) Reserve Price. Procedures establishing reserve prices, either disclosed or undisclosed, above which bids would not win in the auction. The reserve prices may apply individually, in combination, or in the aggregate.

(4) Timing and Method of Placing Bids. Procedures establishing methods and times for submission of bids, whether remotely, by telephonic or electronic transmission, or in person.

(5) Opening Bids and Bid Increments. Procedures establishing maximum or minimum opening bids and, by announcement before or during the auction, maximum or minimum bid increments in dollar or percentage terms.

(6) Withdrawals. Procedures by which bidders may withdraw bids, if withdrawals are allowed.

(7) Stopping Procedures. Procedures regarding when bidding will stop for a round, a stage, or an entire auction, in order to terminate the auction within a reasonable time and in accordance with public interest considerations and the goals, statutory requirements, rules, and procedures for the auction, including any reserve price or prices.

(8) Activity Rules. Procedures for activity rules that require a minimum amount of bidding activity.

(9) Auction Delay, Suspension, or Cancellation. Procedures for announcing by public notice or by announcement during the reverse auction, delay, suspension, or cancellation of the auction in the event of a natural disaster, technical obstacle, network disruption, evidence of an auction security breach or unlawful bidding activity, administrative or weather necessity, or for any other reason that affects the fair and efficient conduct of the competitive bidding, and procedures for resuming the competitive bidding starting from the beginning of the current or some previous round or cancelling the competitive bidding in its entirety.

(d) Apportioning Package Bids. If the public notice establishing detailed competitive bidding procedures adopts procedures for bidding for support on combinations or packages of geographic areas, the public notice also shall establish a methodology for apportioning such bids among the geographic areas within the combination or package for purposes of implementing any Commission rule or procedure that requires a discrete bid for support in relation to a specific geographic area.

(e) Public Notice of Competitive Bidding Results. After the conclusion of competitive bidding, a public notice shall identify the winning bidders that may apply for the offered universal service support and the amount(s) of support for which they may apply, and shall detail the application procedures.

[76 FR 73851, Nov. 29, 2011, as amended at 82 FR 15449, Mar. 28, 2017]

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§1.21004   Winning bidder's obligation to apply for support

(a) Timely and Sufficient Application. A winning bidder has a binding obligation to apply for support by the applicable deadline. A winning bidder that fails to file an application by the applicable deadline or that for any reason is not subsequently authorized to receive support has defaulted on its bid.

(b) Liability for Default Payment. A winning bidder that defaults is liable for a default payment, which will be calculated by a method that will be established as provided in a public notice prior to competitive bidding. If the default payment is determined as a percentage of the defaulted bid amount, the default payment will not exceed twenty percent of the amount of the defaulted bid amount.

(c) Additional Liabilities. A winning bidder that defaults, in addition to being liable for a default payment, shall be subject to such measures as the Commission may provide, including but not limited to disqualification from future competitive bidding pursuant to this subpart AA, competitive bidding for universal service support.

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