11.—(1) Where there is only one bidder, OFCOM shall notify that bidder of—
(a) a deadline by when the bidder must deliver to OFCOM at Riverside House, 2a Southwark Bridge Road, London SE1 9HA a lot selection menu in the form set out in Schedule 3 completed in accordance with paragraph (2) and signed on its behalf by two authorised persons; and
(b) a further deadline by when the bidder must pay into OFCOM’s bank account by a same day electronic transfer, with accompanying information which identifies the bidder, a sum determined in accordance with paragraph (4).
(2) The bidder must ensure that its lot selection satisfies the following conditions—
(a) at least one lot is selected;
(b) a licence condition is specified which it wishes to have included in the licence for that selection of lots.
(3) The licence fee shall be the total amount of the prices as specified by OFCOM on the lot selection menu for the lots selected by the bidder.
(4) The sum which the bidder must pay to OFCOM shall be—
(a) where the initial deposit has not been forfeited in accordance with regulation 49, a sum equal to the licence fee less the initial deposit; or
(b) where the initial deposit has been so forfeited, a sum equal to the licence fee.
12.—(1) Where OFCOM have received from the bidder a completed lot selection menu in accordance with regulation 11(1)(a) and the required sum in accordance with regulation 11(1)(b), OFCOM shall grant the bidder a licence for the lots selected on that completed lot selection menu which includes the licence condition that matches the licence condition chosen by the bidder.
(2) Where OFCOM have not received from the bidder a completed lot selection menu in accordance with regulation 11(1)(a) or the required sum in accordance with regulation 11(1)(b), the bidder shall not be entitled to the grant of a licence and shall not receive a refund of its initial deposit, which shall (where it has not already been forfeited under regulation 49) be forfeited.
13. After the grant of the licence, OFCOM shall complete the award process by—
(a) publishing on their internet website the name of the bidder to which a licence has been granted, the details of the lots in respect of which the licence was granted, the licence condition applying to the licence and the licence fee paid; and
(b) refunding to applicants which were not qualified, or withdrew in accordance with regulation 9, the initial deposits (where such deposits have not been forfeited under regulation 49) but not any interest which has accrued on the deposits.
14.—(1) Where there is more than one bidder, the process for the award of licences shall consist of the procedure set out in Chapters 2 to 5 of this Part (“the auction stage”).
(2) During the auction stage there shall be one or more rounds for the making of primary bids (“primary bid rounds”) and a further round for the making of supplementary bids (“supplementary bids round”).
(3) A bid made during the auction stage shall be a bid for a selection of lots.
(4) The lots available for selection are—
(a) Lot LA - 1452.000 – 1453.816 MHz;
(b) Lot LB - 1453.816 – 1455.528 MHz;
(c) Lot LC - 1455.528 – 1457.240 MHz;
(d) Lot LD - 1457.240 – 1458.952 MHz;
(e) Lot LE - 1458.952 – 1460.664 MHz;
(f) Lot LF - 1460.664 – 1462.376 MHz;
(g) Lot LG - 1462.376 – 1464.088 MHz;
(h) Lot LH - 1464.088 – 1465.800 MHz;
(i) Lot LI - 1465.800 – 1467.512 MHz;
(j) Lot LJ - 1467.512 – 1469.224 MHz;
(k) Lot LK - 1469.224 – 1470.936 MHz;
(l) Lot LL - 1470.936 – 1472.648 MHz;
(m) Lot LM - 1472.648 – 1474.360 MHz;
(n) Lot LN - 1474.360 – 1476.072 MHz;
(o) Lot LO - 1476.072 – 1477.784 MHz;
(p) Lot LP - 1477.784 – 1479.500 MHz; and
(q) Lot LQ - 1479.500 – 1492.000 MHz.
15.—(1) A bid made during a primary bid round (“primary bid”) shall–
(a) be a bid for a selection of lots at an amount in whole pounds which shall be the total amount of the round prices in that primary bid round for each lot included in the selection; and
(b) contain the choice of licence condition which the bidder wishes to have included in a licence for that selection of lots.
(2) The round price means the price per lot determined in accordance with regulation 19.
(3) In order to make a primary bid, a bidder must, on a form provided to the bidder by OFCOM (“primary bid form”)—
(a) specify the selection of lots it wishes to be included in a licence;
(b) specify the choice of licence condition which it wishes to have included in a licence for that selection of lots; and
(c) specify an amount in whole pounds that it is willing to pay for the licence, being the total amount of the round prices for each lot included in that selection of lots.
(4) A bidder shall submit no more than one primary bid in a primary bid round.
(5) The selection of lots specified in a primary bid made by a bidder must be such that the total number of eligibility points associated with the primary bid in accordance with paragraph (6) does not exceed the bidder’s eligibility limit for that primary bid round as determined in accordance with regulation 21 or 22 (as the case may be) and notified to the bidder in accordance with regulation 27(1)(c).
(6) The number of eligibility points associated with a primary bid shall be a number equal to the total of the eligibility points associated with each lot included in the selection of lots specified in that primary bid set out in Schedule 5.
16. Any bidder which does not submit a valid primary bid in the first primary bid round shall be excluded from the award process and shall not receive a refund of its initial deposit or any sum that the bidder has paid as a deposit under regulation 23, which shall (where not already forfeited under regulation 49) be forfeited.
17.—(1) A bid made during the supplementary bids round (“supplementary bid”) shall–
(a) be a bid for a selection of lots at an amount in whole pounds; and
(b) contain the choice of licence condition which the bidder wishes to have included in a licence for that selection of lots.
(2) The amount of the supplementary bid shall be determined by the bidder, subject to the restrictions set out in regulation 26.
(3) In order to make a supplementary bid, a bidder shall, on a form provided to the bidder by OFCOM (“supplementary bids form”)—
(a) specify the selection of lots it wishes to be included in a licence;
(b) specify the choice of licence condition which it wishes to have included in a licence for that selection of lots; and
(c) specify an amount in whole pounds that it is willing to pay for the licence.
(4) The selection of lots comprised in a supplementary bid made by a bidder may be the same as or different from the selection of lots comprised in a primary bid made by the bidder.
(5) A bidder shall submit no more than two thousand supplementary bids in the supplementary bids round, subject to the restrictions set out in paragraphs (6) and (7).
(6) A bidder may not submit more than two supplementary bids for each particular selection of lots.
(7) Where a bidder submits two supplementary bids for a particular selection of lots, each of those supplementary bids must specify a different choice of licence condition.
(8) A bidder is not required to submit a supplementary bid.
18.—(1) Where the combination of all bids received in a primary bid round is a compatible combination of bids—
(a) there shall be no further primary bid rounds; and
(b) there shall be a supplementary bids round.
(2) Where the combination of all bids received in a primary bid round is not a compatible combination of bids, there shall be a further primary bid round unless OFCOM determine in accordance with paragraph (3) that there shall be no further primary bid rounds.
(3) OFCOM shall only make such a determination where they are satisfied that it is unlikely that the information that would be available to bidders under regulation 32 following any further primary bid rounds would affect—
(a) the determination of the winning combination of auction stage bids in accordance with regulation 41; or
(b) the determination of the winning price payable by the winning bidder in accordance with regulation 43.
(4) Where OFCOM have made a determination under paragraph (2) there shall be a supplementary bids round.
19.—(1) In the first primary bid round, the round price for each lot shall be the amount set out in Schedule 4.
(2) In subsequent primary bid rounds, the round price for each lot shall be determined by OFCOM in accordance with paragraphs (3) or (5) (as the case may be).
(3) Where a further primary bid round occurs—
(a) the round price for any lot where that lot was included in more than one bid in the previous primary bid round;
(b) the round price for any lot where that lot was only included in one bid in the previous primary bid round where—
(i) one of the lots immediately adjacent to that lot was only included in one other bid; and
(ii) these two bids specified different choices of licence condition; and
(c) the round price for any lot where that lot was only included in one bid in the previous primary bid round where—
(i) one of the lots immediately adjacent to that lot was not included in any bid;
(ii) the next immediately adjacent lot was only included in one other bid; and
(iii) these two bids specified different choices of licence condition;
shall be an amount that is higher than the amount that was the round price for that lot in the previous primary bid round, subject to the limitation in paragraph (4).
(4) In the circumstances described in paragraph (3), the amount of the round price for the lot shall not be more than twice the amount of the round price for that lot in the previous primary bid round.
(5) The amount of the round price for any lot not included in the circumstances described in paragraph (3), shall be the same amount as it was in the previous primary bid round.
20. Before each primary bid round, OFCOM shall determine an eligibility limit for each bidder for that primary bid round in accordance with regulation 21 or 22 (as the case may be).
21.—(1) After the deadline specified in regulation 23(2) and before the start of the first primary bid round, OFCOM shall determine each bidder’s eligibility limit for the first primary bid round in accordance with the requirements of this regulation.
(2) OFCOM shall divide by fifty thousand the total amount of pounds that the bidder has on deposit (including the initial deposit and any additional sum paid under regulation 23, but not including any sum forfeited under regulation 49).
(3) Where the number that results from the calculation in paragraph (2) is greater than nineteen, the eligibility limit shall be nineteen.
(4) Where the number that results from the calculation in paragraph (2) is not greater than nineteen, the eligibility limit shall be—
(a) that number; or
(b) where the number is not a whole number, that number rounded down to the nearest whole number.
22.—(1) For subsequent primary bid rounds, each bidder’s eligibility limit shall be determined either under paragraphs (2) to (4) or under paragraph (5) (as the case may be).
(2) Where a bidder makes a valid primary bid in a primary bid round, OFCOM shall determine the bidder’s eligibility limit for the next primary bid round by calculating the number of eligibility points associated with the valid primary bid.
(3) The number of eligibility points associated with a valid primary bid shall be a number equal to the total of the eligibility points associated with each lot included in the selection of lots specified in that primary bid in accordance with Schedule 5.
(4) The bidder’s eligibility limit shall be a number equal to the number of eligibility points associated with that valid primary bid.
(5) Where a bidder does not make a valid primary bid in a primary bid round, the bidder’s eligibility limit for the subsequent primary bid round shall be zero.
23.—(1) In addition to the initial deposit, a bidder may pay an additional sum in pounds as a deposit which shall be taken into account by OFCOM in accordance with regulation 21 for the purpose of calculating the bidder’s eligibility limit for the first primary bid round.
(2) A bidder wishing to pay such an additional sum must, by the deadline specified by OFCOM, pay the additional sum into OFCOM’s bank account by a same day electronic transfer with accompanying information which identifies the bidder.
24.—(1) A primary bid shall only be taken into consideration for the purposes of determining—
(a) the number of primary bid rounds in accordance with regulation 18;
(b) the round prices for primary bid rounds in accordance with regulation 19;
(c) the winning combination of auction stage bids in accordance with regulation 41; and
(d) the winning price payable by a winning bidder in accordance with regulation 43;
if it is a primary bid which satisfies the conditions set out in paragraph (2) (“valid primary bid”).
(2) The conditions are that—
(a) the primary bid is made on a primary bid form that has been completed in accordance with regulation 15(3);
(b) the primary bid is submitted in accordance with the restriction set out in regulation 15(4);
(c) the primary bid complies with the restriction set out in regulation 15(5); and
(d) the completed primary bid form is submitted to OFCOM in accordance with regulation 28(1) and is received by OFCOM in accordance with regulation 28(2).
25.—(1) A supplementary bid shall only be taken into consideration for the purposes of determining—
(a) the winning combination of auction stage bids under regulation 41; and
(b) the winning price payable by a winning bidder under regulation 43;
if it is a supplementary bid which satisfies the conditions set out in paragraph (2) (“valid supplementary bid”).
(2) The conditions are that—
(a) the supplementary bid is made on a supplementary bids form that has been completed in accordance with regulation 17(3);
(b) the amount of the supplementary bid specified by the bidder satisfies the requirements set out in regulation 26;
(c) the supplementary bid is submitted in accordance with the restriction set out in regulation 17(6); and
(d) the completed supplementary bids form is submitted to OFCOM in accordance with regulation 35(1) and is received by OFCOM in accordance with regulation 35(2).
26.—(1) The amount of a supplementary bid must be not less than the total amount of the round prices in the first primary bid round for the selection of lots comprised in the supplementary bid
(2) Where the supplementary bid is for a selection of lots in respect of which the bidder has also made a primary bid and the licence condition chosen is the same in the primary bid and the supplementary bid, the amount of the supplementary bid must be greater than the amount of the highest primary bid made by the bidder for that selection of lots for which the licence condition chosen is the same as that in the supplementary bid.
(3) Where—
(a) the bidder did not make a valid primary bid in the final primary bid round; or
(b) the total number of eligibility points associated with the selection of lots comprised in the supplementary bid is greater than the total number of eligibility points associated with the selection of lots comprised in the valid primary bid made by the bidder in the final primary bid round,
the amount of the supplementary bid must not be greater than the amount determined in accordance with paragraph (4).
(4) The amount referred to in sub-paragraph (3) is the total amount of the round prices for the selection of lots comprised in the supplementary bid in the latest primary bid round in which a primary bid made by the bidder for that selection of lots could have satisfied the rules set out in regulation 15(5).
27.—(1) Before the start of each primary bid round, OFCOM shall notify each bidder of—
(a) the date on which, and the times on that date within which, subject to paragraph (2), bidders may make primary bids;
(b) in respect of each lot, the round price for the lot (determined in accordance with regulation 19); and
(c) the eligibility limit for that bidder for that primary bid round (determined in accordance with regulation 21 or 22 as the case may be).
(2) The time notified by OFCOM under paragraph (1)(a) as the end of the primary bid round (“end of round time”) may be treated by a bidder in respect of—
(a) no more than two primary bid rounds; and
(b) for each primary round in respect of which paragraph (3) applies to the bidder, a further primary bid round,
as that time extended by thirty minutes, and OFCOM shall treat the extended time as the end of round time for the purposes of paragraph (1)(a).
(3) This paragraph applies to a bidder where—
(a) in respect of a previous primary bid round, the bidder treated the end of round time for that round as extended by thirty minutes in accordance with paragraph (2);
(b) the bidder submitted its completed primary bid form for that primary bid round so that it was received by OFCOM by the end of round time so extended; and
(c) OFCOM have notified the bidder that they are satisfied that, in respect of that primary bid round, circumstances existed which were beyond the bidder’s control which had the effect that the bidder could not have submitted its primary bid form so that it was received by OFCOM by the end of round time without such an extension.
28.—(1) Except as provided for in regulation 29, the bidder must submit the completed primary bid form to OFCOM by using the electronic auction system.
(2) The completed primary bid form must be submitted to OFCOM by the end of round time.
29.—(1) Where OFCOM are satisfied that a bidder is unable using reasonable endeavours to submit a primary bid form by using the electronic auction system because of technical failure (or an event or circumstance with similar effect on the bidder’s ability to use the electronic auction system), OFCOM shall notify the bidder of an alternative method of submitting the primary bid form and any requirements relating to the authentication of communications made by means of the alternative method.
(2) The bidder must submit the primary bid form by means of the alternative method and must comply with any requirements which have been notified to it under paragraph (1) relating to the authentication of communications.
30.—(1) Where, due to the manner of completion, a primary bid form is incomplete or defective but OFCOM believe that they can ascertain the bidder’s intention in relation to the making of the primary bid, OFCOM shall ask the bidder to confirm in a notice to OFCOM by a specified deadline that OFCOM have correctly ascertained the bidder’s intention in relation to the making of the primary bid.
(2) Where the bidder confirms, in a notice given to OFCOM by the specified deadline which is signed by two authorised persons of that bidder, that OFCOM have correctly ascertained the bidder’s intention, the primary bid form in its entirety shall be accepted by OFCOM on that basis.
(3) Where the bidder does not give such confirmation in a notice given to OFCOM by the specified deadline which is signed by two authorised persons of that bidder, the primary bid form in its entirety shall be rejected by OFCOM and the primary bid submitted on the primary bid form shall not be taken into consideration for the purposes of determining—
(a) the number of primary bid rounds in accordance with regulation 18;
(b) the round prices for primary bid rounds in accordance with regulation 19;
(c) the winning combination of auction stage bids in accordance with regulation 41; and
(d) the winning price payable by a winning bidder in accordance with regulation 43.
31. OFCOM shall notify a bidder which submits a primary bid that is not a valid primary bid of that fact and shall give the reasons why the bid is not a valid primary bid.
32. After the end of a primary bid round and before the start of the subsequent primary bid round (or the start of the supplementary bids round if there is no subsequent primary bid round), OFCOM shall notify bidders of—
(a) the number of bids made in that round which selected each lot available for selection; and
(b) the number of those bids which specified each choice of licence condition for each lot available for selection.
33.—(1) Where in respect of a primary bid the amount specified by a bidder under regulation 15(3)(c) is greater than the total amount that the bidder has on deposit (including the initial deposit, any sum paid as a deposit under regulation 23 and any sum or sums paid as a deposit under this regulation, but not including any sum forfeited under regulation 49) OFCOM may, having regard to the desirability of securing an efficient outcome to the auction stage, subsequently notify the bidder that the bidder is required to pay a further sum in pounds as a deposit.
(2) The further sum shall be an amount such that the total amount that the bidder has on deposit (including the initial deposit, any sum paid as a deposit under regulation 23 and any sum or sums paid as a deposit under this regulation, but not including any sum forfeited under regulation 49) is not less than the highest valid primary bid that the bidder made before OFCOM issued the notification under paragraph (1).
(3) Any such sum shall be paid into OFCOM’s bank account by a same day electronic transfer, with accompanying information which identifies the bidder, by a deadline specified by OFCOM.
(4) Where a bidder does not satisfy the provisions set out in paragraph (3), OFCOM shall notify the bidder of that fact and for any primary bid rounds following notice being given under this paragraph the bidders eligibility limit shall be zero.
34. Before the start of the supplementary bids round, OFCOM shall notify each bidder of —
(a) the date on which, and the times on that date within which, subject to regulation 37, bidders may make supplementary bids; and
(b) the deadline by when bidders must pay a further sum in pounds as a deposit in accordance with regulation 40.
35.—(1) Except as provided for in regulation 36, a bidder must submit the completed supplementary bids form to OFCOM by using the electronic auction system.
(2) Except as provided for in regulation 37, the completed supplementary bids form must be received by OFCOM by the time notified to bidders under regulation 34(a).
36.—(1) Where OFCOM are satisfied that a bidder is unable using reasonable endeavours to submit a supplementary bids form by using the electronic auction system because of technical failure (or an event or circumstance with similar effect on the bidder’s ability to use the electronic auction system), OFCOM shall notify the bidder of an alternative method of submitting the supplementary bids form and any requirements relating to the authentication of communications made by means of the alternative method.
(2) The bidder must submit the supplementary bids form by means of the alternative method and must comply with any requirements which have been notified to it under paragraph (1) relating to the authentication of communications.
37.—(1) Where OFCOM have not received a completed supplementary bids form from a bidder by the time notified to bidders under regulation 34(a) and paragraph (2) applies, the time by which the bidder’s completed supplementary bids form must be received by OFCOM shall be the time sixty minutes after the time notified to bidders under regulation 34(a) as the end of the supplementary bids round.
(2) This paragraph applies where OFCOM are satisfied that circumstances existed which were beyond the bidder’s control which had the effect that the bidder could not have submitted its supplementary bids form so that it was received by OFCOM by the time notified to bidders under regulation 34(a) as the end of the supplementary bids round.
38.—(1) Where, due to the manner of completion, a supplementary bids form is incomplete or defective but OFCOM believe that they can ascertain the bidder’s intention in relation to the making of the supplementary bid or bids, OFCOM shall ask the bidder to confirm in a notice to OFCOM by a specified deadline that OFCOM have correctly ascertained the bidder’s intention in relation to the making of the supplementary bid or bids.
(2) Where the bidder confirms, in a notice given to OFCOM by the specified deadline which is signed by two authorised persons of that bidder, that OFCOM have correctly ascertained the bidder’s intention, the supplementary bids form in its entirety shall be accepted by OFCOM on that basis.
(3) Where the bidder does not give such confirmation in a notice given to OFCOM by the specified deadline which is signed by two authorised persons of that bidder—
(a) where the incompleteness or defect relates to one or more of the supplementary bids made on the supplementary bids form, that supplementary bid or those supplementary bids (as the case may be) shall be rejected by OFCOM and shall not be taken into consideration for the purposes of determining—
(i) the winning combination of auction stage bids under regulation 41; and
(ii) the price payable by a winning bidder under regulation 43;
(b) where sub-paragraph (a) does not apply, the supplementary bids form in its entirety shall be rejected by OFCOM and none of the supplementary bids made on that supplementary bids form shall be taken into consideration for the purposes of determining—
(i) the winning combination of auction stage bids under regulation 41; and
(ii) the price payable by a winning bidder under regulation 43.
39. OFCOM shall notify a bidder which submits a supplementary bid that is not a valid supplementary bid of that fact and shall give the reasons why the bid is not a valid supplementary bid.
40.—(1) By the deadline notified to bidders under regulation 34(b), each bidder must pay into OFCOM’s bank account by a same day electronic transfer, with accompanying information which identifies the bidder, a further sum in pounds as a deposit so that the total amount the bidder has on deposit (including the initial deposit, any sum paid as a deposit under regulation 23 or 33 and any sum paid as a deposit under this paragraph, but not including any sum forfeited under regulation 49) is not less than whichever is the greater of—
(a) the amount of the bidder’s highest valid primary bid as specified by the bidder under regulation 15(3)(c); and
(b) the amount of the bidder’s highest valid supplementary bid as specified by the bidder under regulation 17(3(c).
(2) Where a bidder does not satisfy the provisions set out in paragraph (1), OFCOM shall notify the bidder of that fact and the bidder shall be excluded from the award process and shall not receive a refund of its initial deposit or any sums paid as a deposit under regulation 23, 33 or paragraph (1), which shall (where not already forfeited under regulation 49) be forfeited, and all of that bidder’s primary bids and supplementary bids shall be deemed to be invalid and shall not be taken into consideration for the purpose of determining—
(a) the winning combination of auction stage bids under regulation 41; and
(b) the winning price payable by a winning bidder under regulation 43.
41.—(1) The winning auction stage bids shall be those valid auction stage bids that comprise the winning combination of auction stage bids.
(2) Unless paragraph (3) applies, the winning combination of auction stage bids shall be the compatible combination of bids having the highest total value of amounts bid.
(3) Where there is more than one compatible combination of bids for which the total value is equal highest, the winning combination of auction stage bids shall be determined in accordance with the order of precedence set out in paragraph (4) or, where paragraph (5) applies, in accordance with that paragraph.
(4) The order of precedence shall be determined by the total number of eligibility points associated with each compatible combination of bids in accordance with paragraph (6) such that compatible combinations of bids to which a greater total number of eligibility points are associated prevail over compatible combinations of bids to which a lesser total number of eligibility points are associated.
(5) Where the same number of eligibility points is associated, in accordance with paragraph (6), with any two or more compatible combinations of bids for which the total value is equal highest, OFCOM shall employ a method of random selection from amongst those compatible combinations of bids to determine the winning combination of auction stage bids.
(6) The number of eligibility points associated with a compatible combination of bids shall be a number equal to the total of the eligibility points associated with each lot included in the selections of lots specified in the bids constituting that compatible combination of bids in accordance with Schedule 5.
42.—(1) Where the winning combination of auction stage bids results in some lots not being included in any winning auction stage bid (“unallocated lots”), OFCOM shall–
(a) where there are only two adjoining unallocated lots situated immediately between lots selected in winning auction stage bids with different choices of licence condition, assign to the winning bidders for those winning auction stage bids the unallocated lot adjacent to the lot selected in their winning auction stage bid; and
(b) in any other situation where there are unallocated lots, withhold those lots from being assigned.
(2) A winning bidder’s choice of licence condition does not apply to any unallocated lots assigned to it.
43. In respect of each winning auction stage bid, OFCOM shall determine an amount in accordance with Schedule 6 (“the winning price”) which shall be payable by the relevant winning bidder.(3)
44. Following determination of the winning combination of auction stage bids under regulation 41 and the determination of the winning price for each winning auction stage bid under regulation 43, OFCOM shall notify each bidder of—
(a) the names of the winning bidders; and
(b) in respect of each winning bidder—
(i) the lots comprised in its winning auction stage bid;
(ii) the licence condition which will be included in the licence for those lots;
(iii) any unallocated lots assigned to it under regulation 42(1)(a); and
(iv) the winning price for that winning auction stage bid.
45. The licence fee payable by a winning bidder shall be the amount equal to the winning price for that winning bidder’s winning auction stage bid determined by OFCOM under regulation 43.
On 12th March 2008, OFCOM published notes on the determination of the licence fees payable by bidders in a document called ‘Notes on the determination of licence fees payable by bidders in relation to the award of the 1452MHz-1492MHz spectrum band: Schedule 6 to the Wireless Telegraphy (Licence Award) Regulations 2008’. Back [3]