§ 1.9020   Spectrum manager leasing arrangements.

   Link to an amendment published at  80 FR 56816 , September 18, 2015.

   (a) Overview. Under the provisions of this section, a licensee (in any of
   the included services) and a spectrum lessee may enter into a spectrum
   manager leasing arrangement, without the need for prior Commission approval,
   provided that the licensee retains de jure control of the license and de
   facto control, as defined and explained in this subpart, of the leased
   spectrum. The licensee must notify the Commission of the spectrum leasing
   arrangement pursuant to the rules set forth in this section. The term of a
   spectrum manager leasing arrangement may be no longer than the term of the
   license authorization.

   (b)  Rights  and responsibilities of the licensee. (1) The licensee is
   directly  and primarily responsible for ensuring the spectrum lessee's
   compliance with the Communications Act and applicable Commission policies
   and rules.

   (2) The licensee retains responsibility for maintaining its compliance with
   applicable eligibility and ownership requirements imposed on it pursuant to
   the license authorization.

   (3) The licensee must retain a copy of the spectrum leasing agreement and
   make it available upon request by the Commission.

   (c) Rights and responsibilities of the spectrum lessee. (1) The spectrum
   lessee  must  comply  with  the Communications Act and with Commission
   requirements associated with the license.

   (2) The spectrum lessee is responsible for establishing that it meets the
   eligibility and qualification requirements applicable to spectrum lessees
   under the rules set forth in this section.

   (3) The spectrum lessee must comply with any obligations that apply directly
   to it as a result of its own status as a service provider (e.g., Title II
   obligations if the spectrum lessee acts as a telecommunications carrier or
   acts as a common carrier).

   (4) In addition to the licensee being directly accountable to the Commission
   for  ensuring  the  spectrum lessee's compliance with the Commission's
   operational rules and policies (as discussed in this subpart), the spectrum
   lessee is independently accountable to the Commission for complying with the
   Communications Act and Commission policies and rules, including those that
   apply directly to the spectrum lessee as a result of its own status as a
   service provider.

   (5) In leasing spectrum from a licensee, the spectrum lessee must accept
   Commission  oversight  and  enforcement  consistent  with  the license
   authorization.  The  spectrum  lessee  must  cooperate  fully with any
   investigation or inquiry conducted by either the Commission or the licensee,
   allow the Commission or the licensee to conduct on-site inspections of
   transmission facilities, and suspend operations at the direction of the
   Commission or the licensee and to the extent that such suspension would be
   consistent with the Commission's suspension policies.

   (6) The spectrum lessee must retain a copy of the spectrum leasing agreement
   and make it available upon request by the Commission.

   (d) Applicability of particular service rules and policies. Under a spectrum
   manager leasing arrangement, the service rules and policies apply in the
   following manner to the licensee and spectrum lessee:

   (1) Interference-related rules. The interference and radiofrequency (RF)
   safety  rules  applicable  to use of the spectrum by the licensee as a
   condition of its license authorization also apply to the use of the spectrum
   leased by the spectrum lessee.

   (2) General eligibility rules. (i) The spectrum lessee must meet the same
   eligibility  and qualification requirements that are applicable to the
   licensee under its license authorization, with the following exceptions. A
   spectrum lessee entering into a spectrum leasing arrangement involving a
   licensee in the Educational Broadband Service (see § 27.1201 of this chapter)
   is not required to comply with the eligibility requirements pertaining to
   such a licensee so long as the spectrum lessee meets the other eligibility
   and qualification requirements applicable to 47 CFR part 27 services (see
   § 27.12 of this chapter). A spectrum lessee entering into a spectrum leasing
   arrangement involving a licensee in the Public Safety Radio Services (see
   part 90, subpart B and § 90.311(a)(1)(i) of this chapter) is not required to
   comply with the eligibility requirements pertaining to such a licensee so
   long as the spectrum lessee is an entity providing communications in support
   of public safety operations (see § 90.523(b) of this chapter). A spectrum
   lessee entering into a spectrum leasing arrangement involving a licensee in
   the  Mobile  Satellite Service with ATC authority (see part 25) is not
   required to comply with the eligibility requirements pertaining to such a
   licensee so long as the spectrum lessee meets the other eligibility and
   qualification requirements of paragraphs (d)(2)(ii) and (d)(2)(iv) of this
   section.

   (ii) The spectrum lessee must meet applicable foreign ownership eligibility
   requirements (see sections 310(a), 310(b) of the Communications Act).

   (iii) The spectrum lessee must satisfy any qualification requirements,
   including character qualifications, applicable to the licensee under its
   license authorization.

   (iv) The spectrum lessee must not be a person subject to the denial of
   Federal benefits under the Anti-Drug Abuse Act of 1988 (see § 1.2001 et seq.
   of subpart P of this part).

   (v) The licensee may reasonably rely on the spectrum lessee's certifications
   that it meets the requisite eligibility and qualification requirements
   contained in the notification required by this section.

   (3) Use restrictions. To the extent that the licensee is restricted from
   using the licensed spectrum to offer particular services under its license
   authorization, the use restrictions apply to the spectrum lessee as well.

   (4) Designated entity/entrepreneur rules. A licensee that holds a license
   pursuant to small business and/or entrepreneur provisions (see § 1.2110 and
   § 24.709 of this chapter) and continues to be subject to unjust enrichment
   requirements (see § 1.2111 and § 24.714 of this chapter) and/or transfer
   restrictions (see § 24.839 of this chapter) may enter into a spectrum manager
   leasing  arrangement with a spectrum lessee, regardless of whether the
   spectrum  lessee  meets the Commission's designated entity eligibility
   requirements (see § 1.2110) or its entrepreneur eligibility requirements to
   hold certain C and F block licenses in the broadband personal communications
   services (see § 1.2110 and § 24.709 of this chapter), so long as the spectrum
   manager  leasing  arrangement does not result in the spectrum lessee's
   becoming  a “controlling interest” or “affiliate” (see § 1.2110) of the
   licensee such that the licensee would lose its eligibility as a designated
   entity or entrepreneur. To the extent there is any conflict between the
   revised de facto control standard for spectrum leasing arrangements, as set
   forth in this subpart, and the definition of controlling interest (including
   its de facto control standard) set forth in § 1.2110, the latter definition
   governs for determining whether the licensee has maintained the requisite
   degree of ownership and control to allow it to remain eligible for the
   license  or for other benefits such as bidding credits and installment
   payments.

   (5) Construction/performance requirements. Any performance or build-out
   requirement applicable under a license authorization (e.g., a requirement
   that the licensee construct and operate one or more specific facilities,
   cover a certain percentage of geographic area, cover a certain percentage of
   population, or provide substantial service) always remains a condition of
   the license, and legal responsibility for meeting such obligation is not
   delegable to the spectrum lessee(s).

   (i)  The licensee may attribute to itself the build-out or performance
   activities of its spectrum lessee(s) for purposes of complying with any
   applicable performance or build-out requirement.

   (ii) If a licensee relies on the activities of a spectrum lessee to meet the
   licensee's performance or build-out obligation, and the spectrum lessee
   fails  to  engage in those activities, the Commission will enforce the
   applicable performance or build-out requirements against the licensee,
   consistent with the applicable rules.

   (iii)  If  there  are  rules  applicable to the license concerning the
   discontinuance  of operation, the licensee is accountable for any such
   discontinuance  and  the  rules  will be enforced against the licensee
   regardless of whether the licensee was relying on the activities of a lessee
   to meet particular performance requirements.

   (6) Regulatory classification. If the regulatory status of the licensee
   (e.g., common carrier or non-common carrier status) is prescribed by rule,
   the regulatory status of the spectrum lessee is prescribed in the same
   manner, except that § 20.9(a) of this chapter shall not preclude a licensee
   in the services covered by that rule from entering into a spectrum leasing
   arrangement with a spectrum lessee that chooses to operate on a Private
   Mobile Radio Service (PMRS), private, or non-commercial basis.

   (7) Regulatory fees. The licensee remains responsible for payment of the
   required regulatory fees that must be paid in advance of its license term
   (see  § 1.1152). Where, however, regulatory fees are paid annually on a
   per-unit basis (such as for Commercial Mobile Radio Services (CMRS) pursuant
   to § 1.1152), the licensee and spectrum lessee are each required to pay fees
   for those units associated with its respective operations.

   (8) E911 requirements. If E911 obligations apply to the licensee (see § 20.18
   of this chapter), the licensee retains the obligations with respect to
   leased spectrum.

   (e)  Notifications  regarding spectrum manager leasing arrangements. A
   licensee that seeks to enter into a spectrum manager leasing arrangement
   must notify the Commission of the arrangement in advance of the spectrum
   lessee's commencement of operations. The spectrum manager lease notification
   will be processed pursuant either to the general notification procedures or
   the immediate processing procedures, as set forth herein. The licensee must
   submit the notification to the Commission by electronic filing using the
   Universal Licensing System (ULS) and FCC Form 608, except that a licensee
   falling within the provisions of § 1.913(d) may file the notification either
   electronically or manually.

   (1) General notification procedures. Notifications of spectrum manager
   leasing arrangements will be processed pursuant the general notification
   procedures set forth in this paragraph unless they are submitted and qualify
   for the immediate processing procedures set forth in paragraph (e)(2) of
   this section.

   (i)  To  be  accepted under these general notification procedures, the
   notification must be sufficiently complete and contain all information and
   certifications requested on the applicable form, FCC Form 608, including any
   information and certifications (including those of the spectrum lessee
   relating  to eligibility, basic qualifications, and foreign ownership)
   required  by the rules in this chapter and any rules pertaining to the
   specific service for which the notification is filed. No application fees
   are required for the filing of a spectrum manager leasing notification.

   (ii) The licensee must submit such notification at least 21 days in advance
   of commencing operations unless the arrangement is for a term of one year or
   less, in which case the licensee must provide notification to the Commission
   at least ten (10) days in advance of operation. If the licensee and spectrum
   lessee thereafter seek to extend this leasing arrangement for an additional
   term beyond the initial term, the licensee must provide the Commission with
   notification of the new spectrum leasing arrangement at least 21 days in
   advance of operation under the extended term.

   (iii) A notification filed pursuant to these general notification procedures
   will be placed on an informational public notice on a weekly basis (see
   § 1.933(a)) once accepted, and is subject to reconsideration (see § § 1.106(f),
   1.108, 1.113).

   (2)  Immediate  processing  procedures.  Notifications  that  meet the
   requirements  of  paragraph  (e)(2)(i) of this section qualify for the
   immediate processing procedures.

   (i) To qualify for these immediate processing procedures, the notification
   must be sufficiently complete and contain all necessary information and
   certifications   (including   those  relating  to  eligibility,  basic
   qualifications, and foreign ownership) required for notifications processed
   under the general notification procedures set forth in paragraph (e)(1)(i)
   of this section, and also must establish, through certifications, that the
   following additional qualifications are met:

   (A)  The license does not involve spectrum that may be used to provide
   interconnected  mobile voice and/or data services under the applicable
   service rules and that would, if the spectrum leasing arrangement were
   consummated, create a geographic overlap with spectrum in any licensed
   Wireless Radio Service (including the same service), or in the ATC of a
   Mobile Satellite Service, in which the proposed spectrum lessee already
   holds a direct or indirect interest of 10% or more (see § 1.2112), either as
   a licensee or a spectrum lessee, and that could be used by the spectrum
   lessee to provide interconnected mobile voice and/or data services;

   (B) The licensee is not a designated entity or entrepreneur subject to
   unjust enrichment requirements and/or transfer restrictions under applicable
   Commission rules (see § § 1.2110 and 1.2111, and § § 24.709, 24.714, and 24.839
   of this chapter); and,

   (C)  The spectrum leasing arrangement does not require a waiver of, or
   declaratory ruling pertaining to, any applicable Commission rules.

   (ii) Provided that the notification establishes that the proposed spectrum
   manager leasing arrangement meets all of the requisite elements to qualify
   for  these  immediate processing procedures, ULS will reflect that the
   notification  has been accepted. If a qualifying notification is filed
   electronically, the acceptance will be reflected in ULS on the next business
   day after filing of the notification; if filed manually, the acceptance will
   be reflected in ULS on the next business day after the necessary data from
   the manually filed notification is entered into ULS. Once the notification
   has been accepted, as reflected in ULS, the spectrum lessee may commence
   operations under the spectrum leasing arrangement, consistent with the term
   of the arrangement.

   (iii) A notification filed pursuant to these immediate processing procedures
   will be placed on an informational public notice on a weekly basis (see
   § 1.933(a)) once accepted, and is subject to reconsideration (see § § 1.106(f),
   1.108, 1.113).

   (f) Effective date of a spectrum manager leasing arrangement. The spectrum
   manager leasing arrangement will be deemed effective in the Commission's
   records, and for purposes of the application of the rules set forth in this
   section, as of the beginning date of the term as specified in the spectrum
   leasing notification.

   (g) Commission termination of a spectrum manager leasing arrangement. The
   Commission retains the right to investigate and terminate any spectrum
   manager leasing arrangement if it determines, post-notification, that the
   arrangement constitutes an unauthorized transfer of de facto control of the
   leased spectrum, is otherwise in violation of the rules in this chapter, or
   raises foreign ownership, competitive, or other public interest concerns.
   Information concerning any such termination will be placed on public notice.

   (h) Expiration, extension, or termination of a spectrum leasing arrangement.
   (1) Absent Commission termination or except as provided in paragraph (h)(2)
   or (h)(3) of this section, a spectrum leasing arrangement entered into
   pursuant to this section will expire on the termination date set forth in
   the spectrum leasing notification.

   (2) A spectrum leasing arrangement may be extended beyond the initial term
   set forth in the spectrum leasing notification provided that the licensee
   notifies the Commission of the extension in advance of operation under the
   extended term and does so pursuant to the general notification procedures or
   immediate processing procedures set forth in this section, whichever is
   applicable. If the general notification procedures are applicable, the
   licensee must notify the Commission at least 21 days in advance of operation
   under the extended term.

   (3)  If  a spectrum leasing arrangement is terminated earlier than the
   termination date set forth in the notification, either by the licensee or by
   the parties' mutual agreement, the licensee must file a notification with
   the Commission, no later than ten (10) days after the early termination,
   indicating the date of the termination. If the parties fail to put the
   spectrum leasing arrangement into effect, they must so notify the Commission
   consistent with the provisions of this section.

   (4) The Commission will place information concerning an extension or an
   early termination of a spectrum leasing arrangement on public notice.

   (i) Assignment of a spectrum leasing arrangement. The spectrum lessee may
   assign its spectrum leasing arrangement to another entity provided that the
   licensee has agreed to such an assignment, is in privity with the assignee,
   and notifies the Commission before the consummation of the assignment,
   pursuant  to  the applicable notification procedures set forth in this
   section. In the case of a non-substantial (pro forma) assignment that falls
   within  the class of pro forma transactions for which prior Commission
   approval would not be required under § 1.948(c)(1), the licensee must file
   notification of the assignment with the Commission, using FCC Form 608 and
   providing any necessary updates of ownership information, within 30 days of
   its  completion.  The Commission will place information related to the
   assignment, whether substantial or pro forma, on public notice.

   (j) Transfer of control of a spectrum lessee. The licensee must notify the
   Commission  of any transfer of control of a spectrum lessee before the
   consummation  of  the  transfer of control, pursuant to the applicable
   notification procedures of this section. In the case of a non-substantial
   (pro forma) transfer of control that falls within the class of pro forma
   transactions for which prior Commission approval would not be required under
   § 1.948(c)(1), the licensee must file notification of the transfer of control
   with the Commission, using FCC Form 608 and providing any necessary updates
   of ownership information, within 30 days of its completion. The Commission
   will  place  information  related  to the transfer of control, whether
   substantial or pro forma, on public notice.

   (k) Revocation or automatic cancellation of a license or a spectrum lessee's
   operating authority. (1) In the event an authorization held by a licensee
   that  has  entered  into  a spectrum leasing arrangement is revoked or
   cancelled, the spectrum lessee will be required to terminate its operations
   no later than the date on which the licensee ceases to have any authority to
   operate under the license, except as provided in paragraph (j)(2) of this
   section.

   (2) In the event of a license revocation or cancellation, the Commission
   will  consider  a request by the spectrum lessee for special temporary
   authority (see § 1.931) to provide the spectrum lessee with an opportunity to
   transition its users in order to minimize service disruption to business and
   other activities.

   (3) In the event of a license revocation or cancellation, and the required
   termination of the spectrum lessee's operations, the former spectrum lessee
   does not, as a result of its former status, receive any preference over any
   other  party  should the spectrum lessee seek to obtain the revoked or
   cancelled license.

   (l) Subleasing. A spectrum lessee may sublease the leased spectrum usage
   rights subject to the licensee's consent and the licensee's establishment of
   privity with the spectrum sublessee. The licensee must submit a notification
   regarding  the  spectrum subleasing arrangement in accordance with the
   applicable notification procedures set forth in this section.

   (m) Renewal. Although the term of a spectrum manager leasing arrangement may
   not be longer than the term of a license authorization, a licensee and
   spectrum lessee that have entered into an arrangement whose term continues
   to the end of the current term of the license authorization may, contingent
   on the Commission's grant of the license renewal, renew the spectrum leasing
   arrangement to extend into the term of the renewed license authorization.
   The Commission must be notified of the renewal of the spectrum leasing
   arrangement at the same time that the licensee submits its application for
   license renewal (see § 1.949). The spectrum lessee may operate under the
   extended term, without further action by the Commission, until such time as
   the Commission shall make a final determination with respect to the renewal
   of the license authorization and the extension of the spectrum leasing
   arrangement into the term of the renewed license authorization.

   [ 68 FR 66277 , Nov. 25, 2003, as amended at  69 FR 72027 , Dec. 10, 2004;  69 FR 77551 , Dec. 27, 2004;  76 FR 31259 , May 31, 2011]

   Effective  Date Note: At  69 FR 77551 , Dec. 27, 2004, § 1.9020(e)(2) 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.

   return arrow Back to Top