C6 — Spectrum Licences for Carriers issued via the 3500 MHz Two Phase Residual Auction (2004)

The following conditions of licence apply to radiocommunication carriers for the spectrum licences awarded through the Two Phase Residual Licence Auction in the 2300 MHz and 3500 MHz Frequency Bands.

1. Licence Term

This licence will expire on the date indicated above, with an expectation to renew licences for subsequent ten-year terms unless a breach of licence condition occurs (e.g. failure to meet a reasonable level of service or implementation requirements as outlined in Section 6.13 of the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Frequency Bands (Revised July 2004); a fundamental reallocation of spectrum to a new service is required (e.g. a change in international allocation); or, an overriding policy need arises (e.g. a spectrum reallocation to address a national security issue).

To provide a more stable investment climate for licensees, a consultation regarding the renewal of the licence will commence no later than two years prior to the end of the licence term if the Department foresees the possibility that it will not renew the licence or if renewal fees are contemplated.

2. Licence Transferability and Divisibility

The licensee may transfer its licence(s) in whole or in part(divisibility), in both the bandwidth and geographic dimensions. The area transferred in the geographic dimension may be no smaller than a single spectrum grid cell. A spectrum grid cell is a six-sided figure with an area of 25 square kilometres. The grid cells fit together in an interlocking pattern over the geography of Canada. No minimum limit will be imposed on the amount of spectrum transferred in the bandwidth dimension.

To provide licensees with the maximum flexibility, the auctioned licences will be transferable and divisible subject only to the following conditions and guidelines:

  • All eligibility criteria and other conditions that apply to a licence, including those related to interference management, will continue, as applicable, should the licence be transferred.
  • For each proposed licence transfer, the licensee must provide a written notification to the Minister of Industry. The transferee(s) must provide the Minister of Industry with a declaration as to whether it will be acting as a radiocommunication carrier, a radiocommunication service provider or a radiocommunication user. The transferee(s) must also provide an attestation (or other appropriate documentation) that it will meet the appropriate conditions of licence. The Minister of Industry reserves the right prior to transferring the licences to request additional documentation to determine if the transferee(s) comply(ies) with the appropriate eligibility requirements.
  • Should an auction winner transfer its licence to another party, the second party will only receive a licence term equal to that remaining on the original licence, but will be eligible for the same licence renewal provisions as the original licensee. For example, if the transfer occurs four years into a ten-year licence term, the second party will receive a licence term equal to six years.
  • All proposed licence transfers must comply with any spectrum aggregation limits or other measures intended to preclude anti-competitive behaviour that may be in place.(It should be noted that any licence transfer may also be subject to the provisions of the Competition Act).
  • In order to maintain compatibility with the Department's database, licences will be divisible in the geographic dimension only in terms of spectrum grid cells (as previously described). Thus, when an auctioned licence is divided, the minimum geographic size that any one of the new divisions may take is one spectrum grid cell. The individual spectrum grid cells are sufficiently small that even with this restriction, an extremely high degree of flexibility will be available to the parties involved in determining the size and shape of sub-divided portions of a licence.
  • There will be no minimum limit to divisibility in the bandwidth dimension.
  • Written notification will be required of all proposed licence transfers. The Department will also request attestations or other documentation to ensure that the points above (e.g. compliance with the eligibility criteria and other conditions of licence) have been satisfactorily addressed. Once a licence transfer has been registered, the Department will revoke the original licence and issue a new licence(s) in its place.
  • The Department will maintain a publicly accessible database listing of all auctioned licences and respective licensees, and will update the database upon a licence transfer.

3. Spectrum Aggregation Limit

The licensee must comply with the 100 MHz spectrum aggregation limit outlined in Section 3.4 of the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Frequency Bands (Revised July 2004), which applies to all participating companies, their Affiliates (see Section 7.2.1) and Associated Entities (see Section 7.2.2) of the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Frequency Bands (Revised July 2004). The spectrum aggregation limit will be enforced during the auction and for two years after the close of the auction.

The licensee must notify the Minister of any change that would have a material effect on its compliance with these spectrum aggregation limits. Such notification must be made in advance for any proposed transactions within the licensee's knowledge.

4. Eligibility Criteria - Ownership & Control

The licensee as a radiocommunication carrier, must meet the ownership and control requirements in section 10(2) of the Radiocommunication Regulations. The licensee must notify the Minister of Industry of any change that would have a material effect on its eligibility. Such notification must be made in advance for any proposed transactions within its knowledge. For more information, refer to Client Procedures Circular 2-0-15, Canadian Ownership and Control (CPC-2-0-15).

5. Displacement of Incumbents

The licensee must comply with the transition policy outlined in Appendix 3 of the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Frequency Bands (Revised July 2004).

6. Radio Station Installations

Site-specific radio licences will not be required for each radio station. However, for each radio station, the licensee must ensure that:

  • radio stations are installed and operated in a manner that complies with Health Canada's limits of exposure to radio frequency fields;
  • where applicable, antenna structures are marked in accordance with the recommendations of Transport Canada;
  • prior to installation of significant antenna structures, consultation with the appropriate land use authorities has taken place. Installation of any significant antenna structure must be delayed for a period of time sufficient for Departmental review (refer to Client Procedures Circular 2-0-03, Radiocommunication and Broadcasting Antenna Systems (CPC-2-0-03) as amended from time to time) where, after considering reasonable alternatives and consultation options, land-use consultation negotiations remain at an impasse; and,
  • radio installations are installed and operate in a manner that complies with technical boundary and out-of-band emission conditions as specified by the Department.

7. Provision of Technical Information

When the Department requests technical information on a particular station or on a network, the information must be provided by licensees to the Department according to the definitions and criteria specified by the Department.

8. Laws, Regulations, and Other Obligations

To ensure that licensees can continue to quickly and efficiently adapt their public service offerings to changing consumer demands, the Department will provide licensees with the maximum possible flexibility in determining the services they will offer and the technologies they will employ. Beyond the need to conform to the applicable Canadian spectrum allocations, only those limitations required for interference management purposes (discussed in Section 5 of the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Frequency Bands (Revised July 2004) will be imposed.

The licensee is subject to, and must comply with, the Radiocommunication Act, the Radiocommunication Regulations and the International Telecommunication Union (ITU) Radio Regulations and Canadian Table of Frequency Allocations pertaining to its licensed radio frequency bands. The licence is issued on condition that the certification made in the application materials are all true and complete in every respect.

9. Technical Considerations

The licensee must comply with the technical requirements outlined in Sections 5.3 and 5.4 of the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Frequency Bands (Revised July 2004).

10. International and Domestic Coordination

The licensee must comply with the requirements of cross-border sharing and coordination arrangements established between Canada and the United States, as amended from time to time. While frequency assignments are not subject to site by by site licensing, licensees may be required to furnish all necessary technical data to Industry Canada for each relevant site in order for international coordination to be effected with the United States as per the terms of any existing or future sharing arrangement. Should international coordination be required, Industry Canada will identify the appropriate data elements, format and means of submission.

Coordination between licensees within Canada will follow similar procedures as those for international coordination.

11. Lawful Interception

Certain radiocommunication carrier licensees are required to provide for and maintain lawful interception capabilities in accordance with requirements or standards set by the Solicitor General of Canada. These capabilities address both technical and operational matters related to the lawful interception of telecommunications.

Licensees must, from the inception of service, provide for and maintain lawful interception capabilities. The requirements for lawful access capabilities for circuit-switched voice telephony systems are provided in the Solicitor General's Enforcement Standards for Lawful Interception of Telecommunications (Revised November 1995). These standards may be amended from time to time, following consultation with the Solicitor General of Canada and the licensees. For licensees planning to install and operate technologies or topologies that are not circuit-switched or are currently under development, the Department will require that the licensee implement any lawful interception solution available to the licensee.

Licensees may request that the Minister forbear from enforcing certain lawful interception capability requirements for a limited period of time. The Minister, following consultation with the Solicitor General, may exercise the power to forbear from enforcing a requirement or requirements where, in the opinion of the Minister, the requirement(s) is (are) not reasonably achievable. Forbearance requests must include specific details and dates when compliance to requirement(s) can be expected.

Licensees 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 the Solicitor General and the Department of Justice on this initiative and will provide licensees with the appropriate guidance until such time as any new legislation is enacted.

12. Research and Development

The licensee must invest, as a minimum, 2 percent of its adjusted gross revenues resulting from the use of this licence, averaged over the term of the licence, in eligible research and development (R&D) activities related to telecommunications. Eligible R&D activities are those which meet the definition of scientific research and experimental development adopted in the Income Tax Act, as amended from time to time. Adjusted gross revenues are defined as total service revenues, less inter-carrier payments, bad debts, third party commissions, and provincial goods and services taxes collected. The licensee is exempt from R&D expenditure requirements if it, together with all affiliated licensees that are subject to the R&D condition of licence, has less than $1 billion in annual gross operating revenues from the provision of wireless services in Canada, averaged over the term of the licence. For this condition of licence, an affiliate is defined as a person who controls the carrier, or who is controlled by the carrier or by any person who controls the carrier, as per subsection 35(3) of the Telecommunications Act.

13. Implementation of Spectrum Usage

The licensee must demonstrate to Industry Canada that its spectrum is being put to use at a level acceptable to the Department by the end of the licence term. Licensees must demonstrate coverage at the level indicated in Annex A of DGSO-004-013 Decisions Concerning the Renewal of the 2300 MHz and 3500 MHz Licences.

14. Annual Reporting

The licensee must submit an annual report for each year of the licence term, which includes the following information:

  • a statement indicating continued compliance with all conditions of licence;
  • an update on the implementation and spectrum usage within the area covered by the licence;
  • existing audited financial statements with an accompanying auditor's report;
  • a statement indicating the annual gross operating revenues from the provision of wireless services in Canada and, where applicable, the annual adjusted gross revenues resulting from the use of this licence, as defined in these conditions of licence.
  • a report of the R&D expenditures as set out in these conditions of licence Industry Canada may request an audited statement of R&D expenditures with an accompanying auditor's report at its discretion;
  • supporting financial statements where a licensee is claiming an exemption based on, together with all affiliated licensees that are subject to the R&D condition of licence, it having less than $1 billion in annual gross operating revenues from the provision of wireless services in Canada, averaged over the term of the licence;
  • a copy of any existing corporate annual report for the licensee's fiscal year with respect to the authorization; and
  • other information related to the licence as specified in any notice updating the reporting requirements as issued by Industry Canada.

All reports and statements are to be certified by an officer of the company and submitted, in writing, within 120 days of the licensee's fiscal year-end. Confidential information provided will be treated in accordance with subsection 20(1) of the Access to Information Act.

Reports are to be submitted to Industry Canada at the following address:

Industry Canada
Spectrum Management Operations Branch
Manager, Emerging Networks
235 Queen Street (JETN, 15th floor)
Ottawa, Ontario
K1A 0H5

Last revision date: March 6, 2014

Date modified: