§ 20.22   Rules governing mobile spectrum holdings.

   (a)  Applicants  for  mobile wireless licenses for commercial use, for
   assignment or transfer of control of such licenses, or for long-term de
   facto transfer leasing arrangements as defined in § 1.9003 of this chapter
   and  long-term  spectrum manager leasing arrangements as identified in
   § 1.9020(e)(1)(ii) must demonstrate that the public interest, convenience,
   and necessity will be served thereby. The Commission will evaluate any such
   license application consistent with the policies set forth in Policies
   Regarding Mobile Spectrum Holdings, Report and Order, FCC 14-63, WT Docket
   No. 12-269, adopted May 15, 2014.

   (b) Attribution of interests. (1) The following criteria will apply to
   attribute partial ownership and other interests in spectrum holdings for
   purposes of:

   (i) Applying a mobile spectrum holding limit to the licensing of spectrum
   through competitive bidding; and

   (ii) Applying the initial spectrum screen to secondary market transactions.

   (2) Controlling interests shall be attributable. Controlling interest means
   majority voting equity ownership, any general partnership interest, or any
   means  of actual working control (including negative control) over the
   operation of the licensee, in whatever manner exercised.

   (3) Non-controlling interests of 10 percent or more in spectrum shall be
   attributable.  Interests  of less than 10 percent in spectrum shall be
   attributable if such interest confers de facto control, including but not
   limited to partnership and other ownership interests and any stock interest
   in a licensee.

   (4)  The following interests in spectrum shall also be attributable to
   holders:

   (i) Officers and directors of a licensee shall be considered to have an
   attributable interest in the entity with which they are so associated. The
   officers and directors of an entity that controls a licensee or applicant
   shall be considered to have an attributable interest in the licensee.

   (ii) Ownership interests that are held indirectly by any party through one
   or  more  intervening  corporations  will  be determined by successive
   multiplication of the ownership percentages for each link in the vertical
   ownership chain and application of the relevant attribution benchmark to the
   resulting product, except that if the ownership percentage for an interest
   in any link in the chain exceeds 50 percent or represents actual control, it
   shall be treated as if it were a 100 percent interest. (For example, if A
   owns 20% of B, and B owns 40% of licensee C, then A's interest in licensee C
   would be 8%. If A owns 20% of B, and B owns 51% of licensee C, then A's
   interest in licensee C would be 20% because B's ownership of C exceeds 50%).

   (iii) Any person who manages the operations of a licensee pursuant to a
   management agreement shall be considered to have an attributable interest in
   such  licensee if such person, or its affiliate, has authority to make
   decisions or otherwise engage in practices or activities that determine, or
   significantly influence, the nature or types of services offered by such
   licensee, the terms upon which such services are offered, or the prices
   charged for such services.

   (iv)  Any  licensee or its affiliate who enters into a joint marketing
   arrangement with another licensee or its affiliate shall be considered to
   have an attributable interest in the other licensee's holdings if it has
   authority to make decisions or otherwise engage in practices or activities
   that determine or significantly influence the nature or types of services
   offered  by the other licensee, the terms upon which such services are
   offered, or the prices charged for such services.

   (v) Limited partnership interests shall be attributed to limited partners
   and shall be calculated according to both the percentage of equity paid in
   and the percentage of distribution of profits and losses.

   (vi) Debt and instruments such as warrants, convertible debentures, options,
   or other interests (except non-voting stock) with rights of conversion to
   voting interests shall not be attributed unless and until converted or
   unless  the Commission determines that these interests confer de facto
   control.

   (vii) Long-term de facto transfer leasing arrangements as defined in § 1.9003
   of this chapter and long-term spectrum manager leasing arrangements as
   identified  in  § 1.9020(e)(1)(ii)  that enable commercial use shall be
   attributable to lessees, lessors, sublessees, and sublessors for purposes of
   this section.

   (c) 600 MHz Band holdings. (1) The Commission will reserve licenses for up
   to  30 megahertz of the 600 MHz Band, offered in the Incentive Auction
   authorized by Congress pursuant to 47 U.S.C. 309(j)(8)(G), for otherwise
   qualified bidders who do not hold an attributable interest in 45 megahertz
   or more of the total 134 megahertz of below-1-GHz spectrum which consists of
   the cellular (50 megahertz), the 700 MHz (70 megahertz), and the SMR (14
   megahertz) spectrum in a Partial Economic Area (PEA), as calculated on a
   county by county population-weighted basis, utilizing 2010 U.S. Census data.
   The  amount  of  reserved and unreserved 600 MHz Band licenses will be
   determined based on the market-based spectrum reserve set forth in Policies
   Regarding Mobile Spectrum Holdings, Report and Order, FCC 14-63, WT Docket
   No. 12-269, adopted May 15, 2014, as well as subsequent Public Notices.
   Nothing in this paragraph will limit, or may be construed to limit, an
   otherwise qualified bidder that is a non-nationwide provider of mobile
   wireless services from bidding on any reserved or unreserved license offered
   in the Incentive Auction.

   (2) For a period of six years, after initial licensing, no 600 MHz Band
   license,  regardless  of  whether it is reserved or unreserved, may be
   transferred, assigned, partitioned, disaggregated, or long term leased to
   any entity that, after consummation of the transfer, assignment, or leased
   on a long term basis, would hold an attributable interest in one-third or
   more of the total suitable and available below-1-GHz spectrum as calculated
   on a county by county population-weighted basis in the relevant license
   area, utilizing 2010 U.S. Census data.

   (3) For a period of six years, after initial licensing, no 600 MHz Band
   reserved license may be transferred, assigned, partitioned, disaggregated,
   or leased on a long term basis to an entity that was not qualified to bid on
   that reserved spectrum license under paragraph (c)(1) of this section at the
   time of the Incentive Auction short-form application deadline.

   [ 79 FR 40002 , July 11, 2014]

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