Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands

Published September 2003, Revised July 2004
Spectrum Management and Telecommunications Policy

Table of Contents


Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands
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Preface

With this preface the Department is announcing corrections to certain spectrum licences which were made available in the recent auction and outlined in its document Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 and 3500 MHz Bands ("the policy"), issued in September 2003 and revised in December 2003. The policy had identified that Fixed Wireless Access (FWA) Tiers 4-010, 4-151, 4-156 and 4-157 in the 3500 MHz band in Halifax, Dartmouth, Vancouver and nearby coastal areas including those communities that are along the Strait of Georgia, may be susceptible to an increased potential of interference compared to the rest of Canada. The policy should have stated that affected tiers were 4-010, 4-152, 4-157 and 4-158; tier areas 4-151 and 4-156 are not subject to the increased potential of interference.

The Policy also stated that the FWA spectrum blocks in Tiers 4-153, 4-154 and 4-155 on Vancouver Island would not be available for licensing through the spectrum auction. The Policy should have stated that the affected tiers are 4-154, 4-155 and 4-156. Thus, in Tier 4-156 (Courtenay) the FWA spectrum blocks D, E, F, and G were made available for licensing when only spectrum block W should have been available. In Tier 4-153 (Hope) spectrum blocks D, E, F, and G should have been available for licensing. The Department will make available in the upcoming post auction licensing process spectrum blocks D, E, F, and G in Tier 4-153 (Hope). Please refer to Sections 4.3 (Geography) and 5.2.4 (Characterization of Radiolocation Systems) of the policy for further details.

This document is a revised version of the original document Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands published in September 2003.

The following Revision History summarizes all changes that have been made to the original policy and the Amendments and Supplements.

Revision History for the 2300/3500 MHz Policy Paper

Description of Changes – 2300/3500 MHz Policy Paper
Type of Change Reference Explanation Date of Change
Modification Highlights Replace

"A simultaneous multiple round auction will open mid-January, 2004."

with

"A simultaneous multiple round auction will open late January, 2004."

December 5, 2003
Modification Highlights Replace

"Applications to participate in the auction are due November 17, 2003."

with

"Applications to participate in the auction are due December 8, 2003."

November 12, 2003
Modification Key Dates Change Deadline for receipt of submitted questions from October 10, 2003 to October 17, 2003. October 9, 2003
Modification Key Dates Change Date on which answers to submitted questions will be posted from Early November to November 17, 2003. October 9, 2003
Modification Key Dates Change Deadline for receipt of applications to participate in the auction from November 17, 2003 to December 8, 2003. November 12, 2003
Modification Key Dates Change Date on which list of applicants will be published from November 18, 2003 to December 12, 2003. November 12, 2003
Modification Key Dates Change Date on which list of qualified bidders will be published from Early December to Late December. December 2, 2003
Modification Key Dates Change Mock auction for qualified bidders from Early January to Mid-January. December 2, 2003
Modification Key Dates Change Opening day of bidding from Mid-January to Late January. December 2, 2003
Modification Section 4.3 Replace

"Due to these radiolocation services FWA tiers on Vancouver Island (Tiers 4-153, 4-154 and 4-155) will not be available for licensing through the spectrum auction."

with

"Due to these radiolocation services FWA tiers on Vancouver Island (Tiers 4-154, 4-155 and 4-156) will not be available for licensing through the spectrum auction."

July 2004
Modification Section 4.3 Replace

"In addition, FWA tiers in Halifax, Dartmouth, Vancouver and nearby coastal areas including those communities that are along the Strait of Georgia (Tiers 4-010, 4-151, 4-156 and 4-157), may be susceptible to an increased potential of interference. Refer to Section 5.2.4 for further details."

with

"In addition, FWA tiers in Halifax, Dartmouth, Vancouver and nearby coastal areas including those communities that are along the Strait of Georgia (Tiers 4-010, 4-152, 4-157 and 4-158), may be susceptible to an increased potential of interference. Refer to Section 5.2.4 for further details."

July 2004
Modification Section 5.2.4 Replace

"Halifax, Dartmouth, Vancouver and Nearby Coastal Areas and Communities Along the Strait of Georgia (Tiers 4-010, 4-151, 4-156 and 4-157)"

with

"Halifax, Dartmouth, Vancouver and Nearby Coastal Areas and Communities Along the Strait of Georgia (Tiers 4-010, 4-152, 4-157 and 4-158)"

July 2004
Modification Section 5.2.4 Replace

"It should be noted that while the Department is auctioning 3500 MHz spectrum in Halifax, Dartmouth, Vancouver and nearby coastal areas (Tiers 4-010 and 4-151), including those communities that are along the Strait of Georgia (Tiers 4-156 and 4-157), all blocks of spectrum in these areas will be susceptible to an increased potential of interference compared to the rest of Canada."

with

"It should be noted that while the Department is auctioning 3500 MHz spectrum in Halifax, Dartmouth, Vancouver and nearby coastal areas (Tiers 4-010 and 4-152), including those communities that are along the Strait of Georgia (Tiers 4-157 and 4-158), all blocks of spectrum in these areas will be susceptible to an increased potential of interference compared to the rest of Canada."

July 2004
Modification Section 5.2.4 Replace

"Vancouver Island (Tiers 4-153, 4-154 and 4-155)"

with

"Vancouver Island (Tiers 4-154, 4-155 and 4-156)"

July 2004
Modification Section 5.2.4 Replace

"The potential for interference to FWA systems on Vancouver Island, including the Gulf Islands (Tiers 4-153, 4-154, and 4-155) is of particular concern."

with

"The potential for interference to FWA systems on Vancouver Island, including the Gulf Islands (Tiers 4-154, 4-155, and 4-156) is of particular concern."

July 2004
Modification Section 7 Replace

"The Department expects that the actual bidding will commence in mid-January, 2004."

with

"The Department expects that the actual bidding will commence in late January, 2004."

December 5, 2003
Modification Section 7.3.1 Replace

"Therefore, the Department has decided that the financial deposit will be equal to $500 per eligibility point for the first forty (40) points and $3,000 per eligibility point requested thereafter"

with

"Therefore, the Department has decided that the financial deposit will be equal to $500 per eligibility point for the first two hundred (200) points and $3,000 per eligibility point requested thereafter"

November 12, 2003
Modification Section 7.3.3 Replace

"The application form, the associated documents that may be required (as per the instructions provided on the various forms), and the financial deposit are to be physically delivered by 5: 00 p.m., Eastern Daylight Time (EDT), November 17, 2003, to the Manager, Wireless Networks (address provided in Section 1)."

with

"The application form, the associated documents that may be required (as per the instructions provided on the various forms), and the financial deposit are to be physically delivered by 5:00 p.m., Eastern Standard Time (EST), December 8, 2003, to the Manager, Wireless Networks (address provided in Section 1)."

November 12, 2003
Modification Section 7.3.3 Replace

"Any such amendments are to be physically delivered to the Manager, Wireless Networks at the address noted in Section 1, by 5: 00 p.m., Eastern Daylight Time (EDT), November 17, 2003."

with

"Any such amendments are to be physically delivered to the Manager, Wireless Networks at the address noted in Section 1, by 5:00 p.m., Eastern Standard Time (EST), December 8, 2003."

November 12, 2003
Modification Section 7.4 Replace

"The auction is expected to begin mid-January."

with

"The auction is expected to begin late January."

December 5, 2003
Modification Section 7.4 Replace

"A list of all qualified bidders, the licences for which they are eligible to bid, and their initial level of eligibility points will be made public via Industry Canada's Spectrum Management and Telecommunications Web site in early December 2003."

with

"A list of all qualified bidders, the licences for which they are eligible to bid, and their initial level of eligibility points will be made public via Industry Canada's Spectrum Management and Telecommunications Web site late December 2003."

December 5, 2003
Modification Section 7.5 Replace

"This request is to be physically delivered to the Manager, Wireless Networks prior to 5: 00 p.m. (EDT) on the business day preceding the opening of the auction."

with

"This request is to be physically delivered to the Manager, Wireless Networks prior to 5: 00 p.m. (EST) on the business day preceding the opening of the auction."

December 5, 2003
Modification Section 7.7 Replace

"Written questions are to be submitted to the Manager, Wireless Networks by 5: 00 p.m. (EDT), October 10, 2003 at the address provided in Section 1, by fax to (613) 991- 3514, or sent by e-mail to spectrum.auctions@ic.gc.ca."

with

Written questions are to be submitted to the Manager, Wireless Networks by 5:00 p.m. (EDT), October 17, 2003 at the address provided in Section 1, by fax to (613) 991-3514, or sent by e-mail to spectrum.auctions@ic.gc.ca."
October 9, 2003
Modification Section 8.3 Replace

"The financial deposit is $500 per eligibility point for the first forty (40) points and $3,000 per eligibility point requested thereafter."

with

"The financial deposit is $500 per eligibility point for the first two hundred (200) points and $3,000 per eligibility point requested thereafter."

November 12, 2003
Modification Section 8.3 Example Replace

"The financial deposit required is equal to $500 per eligibility point for the first forty (40) points and $3,000 per eligibility point requested thereafter. Bidder X therefore prepares a financial deposit in the amount of $17,684,000 (40 × $500+5888 × $3,000)."

with

"The financial deposit required is equal to $500 per eligibility point for the first two hundred (200) points and $3,000 per eligibility point requested thereafter. Bidder X therefore prepares a financial deposit in the amount of $17,284,000 (200 × $500+5728 × $3,000)."

November 12, 2003
Modification Section 8.5 Example 1 Replace

"Since the actual activity (288) level exceeds the required activity level (300), Bidder X will maintain its full 480 eligibility points for the next round."

with

"Since the actual activity (300) level exceeds the required activity level (288), Bidder X will maintain its full 480 eligibility points for the next round."

November 12, 2003
Modification Section 8.6 Replace

"The new bid price for that licence will be rounded up to the nearest two significant digits."

with

"The new bid price for that licence will be rounded up to the nearest three significant digits from the left."

December 5, 2003
Modification Section 9.3 Replace

"If the licence is not sold in a subsequent licensing process, then the selling price will be deemed to be zero and the penalty will be calculated accordingly. An additional amount of (a) 3% of the original forfeited bid; or (b) $100,000 for each forfeited bid will be charged, regardless of the eventual selling price."

with

"If the licence is not sold in a subsequent licensing process, then the selling price will be deemed to be zero and the penalty will be calculated accordingly. An additional amount of the greater of (a) 3% of the original forfeited bid; or (b) $10,000 for each forfeited bid will be charged, regardless of the eventual selling price."

November 17, 2003
Modification Appendix 4 Part 4 (10) Replace

"Calculate your required financial deposit by multiplying the value in Box A the appropriate dollar value. For the first forty eligibility points the deposit is equal to $500 per point and $3,000 per eligibility point requested thereafter."

with

"Calculate your required financial deposit by multiplying the value in Box A by the appropriate dollar value. For the first two hundred eligibility points the deposit is equal to $500 per point and $3,000 per eligibility point requested thereafter."

November 12, 2003
Modification Appendix 7 Change eligibility points listed for 4-159 (Merritt) from 10 eligibility points to 1 eligibility point per 25 MHz. November 12, 2003
Modification Appendix 7 Revised format of Appendix 7 December 5, 2003
Deletion Appendix 7 Delete 4-156 d Courtenay; 4-156 e Courtenay and 4-156 g Courtenay (See Preface on page (i) for further explanation.) July 2004
Addition Appendix 7 Add 4-153 d Hope; 4-153 e Hope; 4-153 f Hope; and 4-153 g Hope (See Preface on page (i) for further explanation.) July 2004
  Checklist Replace

"by 5: 00 p.m., Eastern Daylight Time (EDT), November 17, 2003."

with

"by 5:00 p.m., Eastern Standard Time (EST), December 8, 2003."

November 12, 2003
Deletion Checklist Delete (See Appendix 7) December 5, 2003
Addition Section 10 Amendments and Supplements and Clarification Questions to the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands December 5, 2003


Revision History for the 2300/3500 MHz Amendments and Supplements Paper Description of Changes
Type of Change Reference Explanation Date of Change
Modification Section 10.5.4 Question 42 Replace

"Yes the Department has the right to change the date of the auction after the financial deposits have been submitted on November 24, 2003"

with

"Yes the Department has the right to change the date of the auction after the financial deposits have been submitted on December 8, 2003".

November 12, 2003
Modification Section 10.5.6
Question 48
Replace

"While the Department does not intend to publish the identify of the author's questions, requests for such information will be subject to the Access to Information Act and the Privacy Act."

with

"While the Department does not intend to publish the identify of the authors of the questions, requests for such information will be subject to the Access to Information Act and the Privacy Act."

December 5, 2003
Modification Section 10.6.1 Replace

"In Section 8.6 of the Policy which explains how the bid increments will be calculated, it is noted that the new bid price for the next round would be rounded up to the nearest two significant digits. The auction software will in fact round the new bid price up to three significant digits (e.g. a bid increment of 567,894 would be rounded up to 570,000 and a bid increment of 718.75 would become 719)."

with

"In Section 8.6 of the Policy which explains how the bid increments will be calculated, it is noted that the new bid price for the next round would be rounded up to the nearest two significant digits. The auction software will in fact round the new bid price up to three significant digits from the left (e.g. a bid increment of 567,894 would be rounded up to 568,000 and a bid increment of 718.75 would become 719)."

December 5, 2003
Addition Section 10.5.4
Question 41
Please note that the deadline for receipt of applications (and financial deposits) to participate in the auction has been extended to December 8, 2003. November 12, 2003

Highlights and Key Dates for the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands

  • The objective of this licensing process is to provide access to spectrum in the 2300 MHz and 3500 MHz bands to facilitate the implementation of new and innovative wireless services in urban and rural areas.
  • A simultaneous multiple round auction will open late January, 2004.
  • There are five spectrum licences available in 172 service areas across the country (with the exception of the 3500 MHz licences on Vancouver Island): one 15+15 MHz licence in the 2300 MHz band; three 25+25 MHz licences and one 25 MHz licence in the 3500 MHz band.
  • The spectrum bands 2300 MHz and 3500 MHz have been characterized for interference potential, and the applicable transition and/or coordination requirements of the incumbents and auction winners have been outlined.
  • All entities are eligible to apply to participate in the auction.
  • Each entity, its Affiliates and Associated Entities will be subject to the spectrum aggregation limit of 100 MHz in each of the 2300 MHz and 3500 MHz bands, per service area.
  • Licences have ten year terms.
  • Licences are transferable and divisible in the secondary market.
  • Licensees will have the maximum possible flexibility in determining the services they will offer and the technologies they will employ, within the spectrum allocations and policy.
  • Applications to participate in the auction are due December 8, 2003.
  • An on-line, on-demand audio/video Internet streaming presentation (Webcast) will be made available to provide a general overview of this licensing process in the weeks following the publication of this document. Interested parties are invited to visit the Industry Canada's Spectrum Management and Telecommunications Web site at http://www.ic.gc.ca/spectrumauctions to obtain further information on these sessions.
  • Successful bidders in the auction must be eligible to become radiocommunication carriers and will need to comply with ownership and control requirements, as per Client Procedures Circular 2-0-15, Canadian Ownership and Control (CPC-2-0-15).
Key Dates
Event Time frames*
Release of Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands. September 20, 2003
Publication of Canada Gazette Notice DGRB-003-03 September 20, 2003
Deadline for receipt of submitted questions October 17, 2003
Date on which answers to submitted questions will be posted November 17, 2003
Date on which last FWA FCFS application will be accepted One month prior to the auction start date
Deadline for receipt of applications to participate in the auction December 8, 2003
Date on which list of applicants will be published December 12, 2003
Date on which list of qualified bidders will be published Late December
Mock auction for qualified bidders Mid-January
Opening day of bidding Late January
Auction close Unknown
Submission of ownership and control documentation 10 business days after the close of the auction
Initial payment (20% of high bids / 100% of penalties) 10 business days after the close of the auction
Final payment (80% of high bids) 30 business days after the close of the auction

*Please consult the Spectrum Management and Telecommunications Web site at http://www.ic.gc.ca/spectrumauctions for updates to this schedule.

Gazette Notice DGRB-003-03 — Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands