Office of Public Sector Information

Regulation 58

SCHEDULE 9 DETERMINATION OF ADDITIONAL PRICE

Additional price

1.—(1) OFCOM shall determine an additional price for each winning assignment stage bid by imposition of the requirements that the additional prices must satisfy that are set out in paragraphs 2 to 5.

(2) Where an additional price so determined includes a fraction of a pound, the additional price shall be that price rounded up to the nearest pound.

First requirement

2.  The additional price for each winning assignment stage bid shall be no less than zero and no greater than the amount of that winning assignment stage bid.

Second requirement

3.—(1) Taking the additional prices for the winning assignment stage bids for paired frequency ranges in the same band together, the additional prices for winning assignment stage bids for paired frequency ranges in a band shall be such that if—

(a) the amount bid by each winning bidder for the paired frequency range selected in its winning assignment stage bid for a paired frequency range in that band had been the additional price rather than the amount of its winning assignment stage bid (“reduced winning assignment stage bid”), and

(b) subject to sub-paragraph (2), the amount bid by each winning bidder in respect of each other valid assignment stage bid made by that bidder for a paired frequency range in that band had been reduced by an amount equal to the difference between the amount of its winning assignment stage bid for a paired frequency range in that band and the additional price for that relevant winning assignment stage bid,

the combination of the reduced winning assignment stage bids submitted by the winning bidders would have been the valid combination of assignment stage bids or one of the valid combinations of assignment stage bids (as the case may be) for paired frequency ranges in that band having the highest total value of amounts bid.

(2) Where the amount of a bid has been reduced in accordance with sub-paragraph (1)(b) and is less than zero, the amount of that bid shall be treated as if it were zero for the purposes of this paragraph.

(3) The bids mentioned in sub-paragraph (1)(a) and (b) shall, after reduction of the amount of those bids in accordance with those paragraphs, be treated as valid assignment stage bids for the purposes of this paragraph.

Third requirement

4.  Taking the additional prices for the winning assignment stage bids for paired frequency ranges in the same band together, the total of those additional prices for winning assignment stage bids for paired frequency ranges in a band shall be no greater than the total of any other prices for the winning assignment stage bids for paired frequency ranges in that band that satisfy the requirements set out in paragraphs 2 and 3.

Fourth requirement

5.—(1) Taking the additional prices for the winning assignment stage bids for paired frequency ranges in the same band together, the opportunity cost variance of those additional prices for winning assignment stage bids for paired frequency ranges in a band calculated in accordance with sub-paragraph (2) shall be less than the opportunity cost variance, calculated in accordance with sub-paragraph (2), of any other prices for the winning assignment stage bids for paired frequency ranges in that band that satisfy the requirements set out in paragraphs 2 to 4.

(2) The opportunity cost variance (“”) of the prices mentioned in sub-paragraph (1) is the amount calculated in accordance with the formula—

where—

“” is the price for a winning assignment stage bid; and

“” is the amount calculated in accordance with the formula set out in sub-paragraph (3) in respect of that winning assignment stage bid.

(3) The formula is—

• where—

“” is the amount calculated in accordance with sub-paragraph (4);

“” is the total amount of the winning assignment stage bids; and

“” is the amount of the winning assignment stage bid for which is the price.

(4) The amount calculated in accordance with this sub-paragraph is the total amount of the valid combination of assignment stage bids or one of the valid combinations of assignment stage bids (as the case may be) for paired frequency ranges in the same band having the highest total value of amounts bid where, for each assignment stage bid for a paired frequency range in that band made by the winning bidder that submitted the winning assignment stage bid for which is the price, the amount of that assignment stage bid is treated as if it were zero for the purposes of this sub-paragraph.

(5) Where the amount of an assignment stage bid is treated as if it were zero under sub-paragraph (4), that assignment stage bid shall be treated as a valid assignment stage bid for the purposes of that sub-paragraph.

Interpretation

6.  In this Schedule “valid combination of assignment stage bids” shall be construed in accordance with regulation 57.