Licensing Framework for the Auction for Spectrum Licences for Advanced Wireless Services and other Spectrum in the 2 GHz Range

4. Licence Conditions

Licensees must be fully aware of their obligations with respect to licence terms and conditions. Industry Canada will monitor compliance and take any necessary action, to ensure compliance and to enforce the provisions of the Radiocommunication Act and Radiocommunication Regulations.

The following conditions will apply to licences for the AWS, PCS Expansion and 1670-1675 MHz spectrum bands.

4.1 Licence Term

The AWS licences will be issued for a 10-year term similar to other spectrum licences. At a minimum of 2 years before the end of this term, and any subsequent terms, the licensee may apply for licence renewal for an additional licence term of up to 10 years. AWS licence renewal will be subject to a public consultation process initiated in year eight. The nature and details of this process will be developed through a separate consultation to be initiated by the Department in the context of the Framework for Spectrum Auctions in Canada. The renewal process developed through that consultation may apply to all auctioned licences, including AWS.

The renewal process, which will form the basis of the follow-up consultation, will include consideration of:

  • the extent of geographic coverage across the licensed area;
  • whether there is interest in the licence from other parties;
  • whether licence fees should apply for a subsequent licence term; and
  • whether renewal in whole or in part supports the orderly development of radiocommunication in light of the policy objectives of the Telecommunications Act given known future factors, pressures and the spectrum environment.

Beyond consideration of the above factors, other reasons for non or partial renewal may include:

  • a fundamental reallocation of spectrum to a new service is required;
  • an overriding policy need or spectrum management concern arises;
  • national security, treaty or other international obligations or requirements;
  • a breach of licence condition;
  • the spectrum has not been deployed, or not sufficiently deployed over the licensed area;
  • whether there is interest from others for access to the spectrum; and
  • other relevant factors which might be raised in the public consultation.

4.2 Licence Transferability and Divisibility

The licensee may apply to transfer its licence(s) in whole or in part (divisibility), in both the bandwidth and geographic dimensions. The Department may define a minimum bandwidth and/or geographic dimension (such as the grid cell Footnote 1 for the proposed transfer. Systems involved in such a transfer shall conform to the technical requirements set forth in the applicable standards mentioned in Section 2, Technical Considerations. Footnote 2

Licences acquired through the set-aside may not be transferred or leased to, divided among, or exchanged with companies that do not meet the criteria of a new entrant, for a period of 5 years from the date of issuance.

Departmental approval is required for each proposed transfer of a licence, whether the transfer is in whole or in part. The licensee must apply to the Department in writing. The transferee(s) must also provide an attestation and other supporting documentation demonstrating that it meets the eligibility criteria and all other conditions, technical or otherwise, of the licence.

4.3 Eligibility Criteria

A licensee must be eligible to become a radiocommunication carrier and as such, must comply on an ongoing basis with the eligibility criteria in section 10(2) of the Radiocommunication Regulations. The licensee must notify the Minister of Industry of any change which would have a material effect on its eligibility. Such notification must be made in advance for any proposed transaction within its knowledge. For more information, refer to Industry Canada's Client Procedures Circular 2-0-15, Canadian Ownership and Control (CPC-2-0-15), as amended from time to time.

4.4 Displacement of Incumbents

Licensees must comply with the transition policy set out in the Consultation on a Framework to Auction Spectrum in the 2 GHz Range Including Advanced Wireless Services, Part I, Section 3. Treatment of Incumbent Licensees. Furthermore, licensees should note the following:

  • Industry Canada will retain oversight of the displacement process and will assist, where appropriate, affected fixed operators in identifying new replacement frequency assignments.
  • In the event the AWS and PCS operators need to defer a notified displacement date, an amendment to the date should be identified to the Department as early as possible.
  • Industry Canada will monitor the effectiveness of the spectrum policy provisions related to the displacement of fixed systems. In the long term, changes to these provisions and/or licence conditions may be made to ensure that the continued availability of spectrum for AWS and PCS systems is accomplished in the most efficient manner.

4.5 Radio Station Installations

While site-specific radio licences will not be required for each radio station, licensees must ensure that each radio station is installed and operated in a manner that complies with Industry Canada's Client Procedures Circular 2-0-03, Radiocommunication and Broadcasting Antenna Systems, Issue 4, effective January 1, 2008 (CPC-2-0-03), as amended from time to time.

4.6 Provision of Technical Information

When the Department requests technical information on a particular station or network, the information must be provided by the licensee to the Department according to the definitions, criteria, frequency, and timelines specified by the Department. For more information, refer to Client Procedures Circular 2-1-23, Licensing Procedure for Spectrum Licences for Terrestrial Services (CPC-2-1-23), as amended from time to time.

4.7 Compliance with Legislation, Regulations and other Obligations

The licensee is subject to, and must comply with, the Radiocommunication Act, the Radiocommunication Regulations and the International Telecommunication Union's Radio Regulations pertaining to its licensed radio frequency bands. The licence is issued on condition that the certifications made in the application materials are all true and complete in every respect. The licensees must use the assigned spectrum in accordance with the Canadian Table of Frequency Allocations and the stated spectrum policy. Footnote 3 Licensees may also be subject to, and must abide by, applicable provisions of other statutes and the rulings of other statutory bodies, such as the Canadian Radio-television and Telecommunications Commission (CRTC) or the Competition Bureau.

4.8 International Coordination

Licensees must comply with the current and future agreements established with other countries. While frequency assignments are not subject to site licensing, licensees may be required to furnish all necessary technical data to Industry Canada for each relevant site. However, it is expected that coordination will be carried out by licensees. Licensees will be encouraged to enter into mutually acceptable sharing agreements that will facilitate the reasonable and timely development of their respective systems. These agreements provide the basis for coordination in the U.S. border area.

4.9 Lawful Interception

Licensees using spectrum for circuit-switched voice telephony systems must, from the inception of service, provide for and maintain lawful interception capabilities as authorized by law. The requirements for lawful interception capabilities are provided in the Solicitor General's Enforcement Standards for Lawful Interception of Telecommunications (Rev. Nov. 95). These standards may be amended from time to time following consultation with Public Safety Canada and licensees. Licensees may request the Minister of Industry to forbear from enforcing certain assistance capability requirements for a limited period. The Minister, following consultation with Public Safety Canada, may exercise the power to forbear from enforcing a requirement or requirements where, in the opinion of the Minister, the requirement is not reasonably achievable. Requests for forbearance must include specific details and dates indicating when compliance to the requirement can be expected.

Applicants should be aware that a legislative package is being developed to ensure that law enforcement and national security agencies acting with lawful authority have effective access to communications and information. The Department continues to meet with Public Safety Canada and the Department of Justice on this initiative and will provide licensees with appropriate guidance until such time as any new legislation is enacted.

4.10 Research and Development (R&D)

All licensees must invest, as a minimum, 2% of their adjusted gross revenues resulting from their operations in this spectrum averaged over 5 years for the duration of the licence, in eligible research and development activities related to telecommunications. Eligible research and development activities are those which meet the definition of scientific research and experimental development adopted in the Income Tax Act. Adjusted gross revenues are defined as total service revenues, less inter-carrier payments, bad debts, third-party commissions, and provincial and goods and services taxes collected. As was the case in the 2.3/3.5 GHz auction processes, businesses with less than $5 million in annual gross operating revenues are exempt from R&D expenditure requirements.

To facilitate compliance with this condition of licence, the licensee should consult the Department's Guidelines for Compliance with the Radio Authorization Condition of Licence Relating to Research and Development, which is available on the Spectrum Management and Telecommunications website.

4.11 Implementation of Spectrum Usage

The Department will take into account the roll-out targets listed in Appendix C, both in considering eventual renewal of AWS licences as discussed in Section 4.1, Licence Term, and in considering any application from a national new entrant for extension of in-territory roaming beyond the initial 5 years as discussed in the AWS Policy Framework.

4.12 Annual Reporting

Licensees must submit an annual report for each year of the licence term indicating continued compliance with all licence conditions and including the following information:

  • an update on the implementation of Advanced Wireless Services, Personal Communications Services and/or services in the band 1670-1675 MHz, including the number of hub and subscriber sites installed, type of service delivered (high-speed Internet, voice, etc.), level of service (data rate), number of subscribers, as well as the population covered;
  • existing audited financial statements with an accompanying Auditor's Report;
  • audited Statement of Research and Development Expenditures with an accompanying Auditor's Report (where licensees are claiming an exemption based on an adjusted gross revenue of less than $5 million, supporting financial statements must be provided); and
  • a copy of any existing corporate annual report for the licensee's fiscal year with respect to the authorization.

The reports are to be submitted, in writing, to Industry Canada at the address below within 120 days of the licensee's fiscal year-end. Where a licensee holds multiple licences, the reports should be broken down by service area. Confidential information provided will be treated in accordance with section 20(1) of the Access to Information Act.

Manager, Wireless Networks
Radiocommunications and Broadcasting Regulatory Branch
Industry Canada
300 Slater Street, 15th floor
Ottawa, Ontario
K1A 0C8

4.13 Mandatory Roaming and Antenna Tower and Site Sharing and Prohibition of Exclusive Site Arrangements

On November 28, 2007, the Department released Canada Gazette notice DGTP-010-07. That notice sought input regarding the proposed conditions to implement the policies of mandatory roaming and mandatory antenna tower and site sharing, including the prohibition of exclusive site arrangements. Early in 2008 the final conditions of licence for mandated roaming and antenna tower and site sharing will be posted on the Spectrum Management and Telecommunications website.


Footnotes

1 Spectrum grid cells are defined in Service Areas for Competitive Licensing. (Return to content)

2 Note that this licence condition also allows for subordinate licensing as described in Client Procedures Circular 2-1-23, Licensing Procedure for Spectrum Licences for Terrestrial Services (CPC-2-1-23). (Return to content)

3The Canadian Table of Frequency Allocations.
The changes to the Canadian Table related to AWS can be found in the Consultation on a Framework to Auction Spectrum in the 2 GHz Range including Advanced Wireless Services. (Return to content)


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