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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
)
In the Matter of
)
PUERTO RICO TELEPHONE COMPANY, INC. File No. EB-09-IH-0023
)
Licensee of Various Authorizations in the NAL Acct. No.
Wireless Radio Services and Participant ) 201132080001
in Auction 73
) FRN No. 0001731470
AMERICA MOVIL, S.A.B. de C.V
) FRN No. 0015025067
Parent of Puerto Rico Telephone Company,
Inc. )
)
)
)
CONSENT DECREE
1. The Enforcement Bureau of the Federal Communications Commission, Puerto
Rico Telephone Company, Inc., and America Movil, S.A.B. de C.V., by their
authorized representatives, hereby enter into this Consent Decree for the
purpose of resolving the Enforcement Bureau's investigation of compliance
by Puerto Rico Telephone Company, Inc. and America Movil, S.A.B. de C.V.
with Section 1.2105(c) of the Commission's Rules, 47 C.F.R. S: 1.2105(c),
relating to Puerto Rico Telephone Company, Inc.'s participation in
Commission Auction 73.
I. DEFINITIONS
2. For purposes of this Consent Decree the following definitions shall
apply:
a. "Act" means the Communications Act of 1934, as amended, 47 U.S.C. S:
151 et seq.
b. "Adopting Order" means an order of the Bureau adopting this Consent
Decree without any modifications adverse to PRTC or America Movil.
c. "America Movil" means America Movil, S.A.B. de C.V., of which PRTC is a
wholly-owned subsidiary.
d. "Any" shall be construed to include the word "all," and the word "all"
shall be construed to include the word "any." Additionally, the word "or"
shall be construed to include the word "and," and the word "and" shall be
construed to include the word "or." The word "each" shall be construed to
include the word "every," and the word "every" shall be construed to
include the word "each."
e. "AT&T Mobility" means AT&T Mobility Spectrum, L.L.C., a participant in
Auction 73 and a wholly-owned subsidiary of AT&T.
f. "AT&T" means AT&T Inc., parent of AT&T Mobility.
g. "Bureau" means the FCC's Enforcement Bureau.
h. "Commission" or "FCC" means the Federal Communications Commission.
i. "Effective Date" means the date on which the Bureau releases the
Adopting Order.
j. "Investigation" mean the Bureau's investigation of PRTC's and America
Movil's compliance with Section 1.2105(c)(1) and (c)(6) of the
Commission's Rules, 47 C.F.R. S: 1.2105(c)(1) and (c)(6), relating to
PRTC's participation in Auction 73.
k. "Parties" means the Bureau, PRTC, and America Movil.
l. "PRTC" means Puerto Rico Telephone Company, Inc., a participant in
Auction 73 and a wholly-owned subsidiary of America Movil.
II. BACKGROUND
3. PRTC is a telecommunications provider in Puerto Rico. It serves more
than 1.6 million customers with a variety of advanced services for voice,
data, broadband, and wireless communications. PRTC is a wholly-owned
subsidiary of Mexico City-based America Movil, a provider of wireless
services in Latin America. As of June 30, 2010, America Movil had 211.3
million wireless subscribers and 27.4 million fixed lines in the Americas.
AT&T Inc. owns a substantial number (23.6 percent, based on beneficial
ownership reports filed by AT&T Inc. with the Securities and Exchange
Commission on August 2, 2010) of voting shares in America Movil. In
addition, at all relevant times, two AT&T executives sat on America
Movil's Board of Directors.
4. Section 1.2105(c)(1) of the Commission's Rules, 47 C.F.R. S:
1.2105(c)(1), states in pertinent part:
[A]fter the [FCC Form 175] short-form application filing deadline, all
applicants for licenses in any of the same geographic license areas are
prohibited from cooperating or collaborating with respect to, discussing
with each other, or disclosing to each other in any manner the substance
of their own, or each other's, or any other competing applicants' bids or
bidding strategies, or discussing or negotiating settlement agreements,
until after the down payment deadline, unless such applicants are members
of a bidding consortium or other joint bidding arrangement identified on
the bidder's short-form application . . . .
In addition, Section 1.2105(c)(6) of the Commission's Rules, 47 C.F.R. S:
1.2105(c)(6), requires that "[a]ny applicant that makes or receives a
communication of bids or bidding strategies prohibited under [Section
1.2105(c)(1) of the Commission's Rules ] shall report such communication
in writing to the Commission immediately, and in no case later than five
business days after the communication occurs."
5. PRTC and AT&T Mobility were both participants in Auction 73 for
licenses in the 700 MHz band. AT&T Mobility selected all 1,099 of the
licenses available in the auction, and PRTC selected 16 licenses covering
areas of Puerto Rico and the Virgin Islands. Neither company identified
the existence of any bidding consortium or joint bidding agreement with
the other in its short form application. For Auction 73, the prohibitions
of Section 1.2105(c) applied from 6:00 p.m. ET on December 3, 2007, the
short-form application filing deadline, until 6:00 p.m. ET on April 3,
2008, the down payment deadline. Bidding in Auction 73 began on January
24, 2008, and concluded on March 18, 2008.
6. On January 16, 2009, AT&T reported by letter to the Commission that it
had found a document in the files of two of its employees that appeared to
contain information in a foreign language regarding the participation of
another applicant in Auction 73. In a subsequent letter to the Commission,
dated January 23, 2009, AT&T explained that the document consisted of
minutes, written in Spanish, of a board meeting of America Movil held on
February 5, 2008, and that a copy of the minutes had been found in the
files of a third AT&T employee. Thereafter, on January 26, 2009, AT&T
informed the Commission that it had located a copy of the minutes in the
files of a fourth AT&T employee. The America Movil minutes found in the
files of the four AT&T employees contained information revealing the
amount PRTC was authorized to bid for 700 MHz licenses in Puerto Rico.
Neither PRTC nor America Movil reported to the Commission that these
documents were transmitted to AT&T.
7. On April 6, 2009, the Enforcement Bureau issued a letter of inquiry to
PRTC and America Movil seeking sworn written responses concerning the
specific circumstances by which information about PRTC's bids or bidding
strategy in Auction 73 was communicated by its parent company, America
Movil, to AT&T, the parent company of AT&T Mobility, another participant
for licenses in the same auction, and the lack of notification of such
communication by PRTC to the Commission. The letter of inquiry also sought
sworn statements concerning the adequacy of safeguards between America
Movil and AT&T to prevent communications prohibited by Section 1.2105(c)
of the Commission's Rules, given AT&T's voting and equity interest in
America Movil. On June 9, 2009, PRTC and America Movil responded to the
letter of inquiry.
III. TERMS OF AGREEMENT
8. Adopting Order. The Parties agree that the provisions of this Consent
Decree shall be subject to final approval by the Bureau by incorporation
of such provisions by reference in the Adopting Order without change,
addition, modification, or deletion.
9. Jurisdiction. PRTC and America Movil each agrees that the Bureau has
jurisdiction over it and the matters contained in this Consent Decree and
has the authority to enter into and adopt this Consent Decree.
10. Effective Date; Violations. The Parties agree that this Consent Decree
shall become effective on the date on which the FCC releases the Adopting
Order. Upon release, the Adopting Order and this Consent Decree shall have
the same force and effect as any other Order of the Bureau. Any violation
of the Adopting Order or of the terms of this Consent Decree shall
constitute a separate violation of a Bureau Order, entitling the Bureau to
exercise any rights and remedies attendant to the enforcement of a
Commission Order.
11. Termination of Investigation. In express reliance on the covenants and
representations in this Consent Decree and to avoid further expenditure of
public resources, the Bureau agrees to terminate its Investigation. In
consideration for the termination of said Investigation, PRTC and America
Movil each agrees to the terms, conditions, and procedures contained
herein. The Bureau further agrees that, in the absence of new material
evidence, the Bureau will not use the facts developed in this
Investigation through the Effective Date of the Consent Decree, or the
existence of this Consent Decree, to institute, on its own motion, any new
proceeding, formal or informal, or take any action on its own motion
against PRTC or America Movil concerning the matters that were the subject
of the Investigation. The Bureau also agrees that it will not use the
facts developed in this Investigation through the Effective Date of this
Consent Decree, or the existence of this Consent Decree, to institute on
its own motion any proceeding, formal or informal, or take any action on
its own motion against PRTC or America Movil with respect to PRTC's or
America Movil's basic qualifications, including their character
qualifications, to be a Commission licensee or hold Commission
authorizations.
12. Compliance Plan. For purposes of settling the matters set forth
herein, PRTC and America Movil each agrees to develop a Compliance Plan
within 90 calendar days of the Effective Date related to future compliance
with the Act, the Commission's Rules, and the Commission's Orders
involving FCC auctions. The requirements of the Compliance Plan shall
continue for a period of 3 years after the Effective Date. The Compliance
Plan shall be implemented at least 30 days prior to participation by
either entity in any future FCC auction. The Compliance Plan shall
include, at a minimum, the following components:
a. Definitions - For purposes of this Compliance Plan, the following
definition shall apply:
i. "Auctions Personnel" means with respect to America Movil and
PRTC:
1. all officers and directors, regardless of their ownership
interest in America Movil and PRTC; and
2. all individuals holding controlling interests in America
Movil and PRTC; and
3. all individual holders of ownership interests amounting to
10 percent or more of either company or 10 percent or more
of either company's outstanding stock or either company's
outstanding voting stock, provided the individual also is an
employee of America Movil or PRTC; and
4. all employees or agents of America Movil or PRTC who are
directly involved in America Movil's or PRTC's auction
decision-making or auction-related activities, all employees
or agents possessing information about America Movil's or
PRTC's bids or bidding strategies, and all employees or
agents possessing information that is non-public under the
Commission's anonymous bidding procedures, including
information relating to bidder interests or identities the
public disclosure of which is prohibited at any time during
the auction process.
ii. Notwithstanding the provisions in paragraph 12(a)(i), the term
"Auctions Personnel" shall not include AT&T or its employees.
b. Auctions Compliance Manual
i. No later than 30 days prior to the filing with the FCC by either
America Movil or PRTC of a short form application to participate
in an auction, America Movil and PRTC shall each distribute an
Auctions Compliance Manual to their respective company's Auctions
Personnel. If either company desires to add persons to its
respective Auctions Personnel subsequent to the date that is 30
days prior to the filing with the FCC by either America Movil or
PRTC of a short form application, America Movil or PRTC, as
appropriate, shall provide such persons with a copy of the
Auctions Compliance Manual prior to their receiving information
about America Movil's or PRTC's bids or bidding strategies or any
information that is non-public under the Commission's anonymous
bidding procedures, including information relating to bidder
interests or identities. America Movil and PRTC shall make their
Auctions Compliance Manuals available in both English and
Spanish.
ii. The Auctions Compliance Manual shall include, in greater detail,
the matters covered in the Compliance Training Program, e.g., an
overview of the Commission's requirements for participation in
auctions, including the requirements of the Communications Act
of 1934, as amended (the "Act"), and the Commission's Rules
regarding prohibited communications and related reporting
requirements.
c. Compliance Training Program
i. No later than 30 days prior to the filing with the FCC by either
America Movil or PRTC of a short form application to participate
in an auction, America Movil and PRTC each shall implement a
comprehensive Compliance Training Program for the education of
their respective company's Auctions Personnel, such training to
be completed prior to the short form filing. If either company
desires to add persons to its respective Auctions Personnel
subsequent to the date that is 30 days prior to the filing with
the FCC by either America Movil or PRTC of a short form
application, America Movil or PRTC, as appropriate, shall provide
such persons with compliance training prior to their receiving
information about America Movil's or PRTC's bids or bidding
strategies or any information that is non-public under the
Commission's anonymous bidding procedures, including information
relating to bidder interests or identities. The purpose of the
Compliance Training Program shall be to ensure future compliance
by America Movil and PRTC with all applicable, current
auction-related rules and regulations and prompt reporting of
violations thereof. The Compliance Training Program shall include
an overview of the Commission's requirements for participation in
auctions, including the requirements of the Act, and the
Commission's rules regarding prohibited communications and
related reporting requirements.
d. Compliance Officer and Compliance Reports
i. America Movil and PRTC each shall designate an officer of the
company to serve as its Compliance Officer. Such Compliance
Officer shall be directly responsible for overseeing compliance
with all of the requirements of this Compliance Plan.
ii. The Compliance Officer shall, among other things:
1. Communicate the substance of this Compliance Plan to all
Auctions Personnel.
2. Oversee and be responsible for all aspects of the
Compliance Training Program referenced in paragraph 2,
above, including monitoring and evaluating the
participation in all educational training sessions provided
under the Compliance Training Program;
3. Maintain auditable records demonstrating compliance with
all aspects of this Compliance Plan and produce such
records, together with a certified English translation
thereof if the original is written in Spanish, to the
Commission upon written request for such within 14 calendar
days;
4. Disclose in a written Disclosure Report, in English, to the
Commission within 14 calendar days of any event or
occurrence that causes the company to be out of compliance
with any provision of this Consent Decree; any provision of
this Compliance Plan; and/or any provision of the Act, as
amended, and/or the Commission's rules, regulations,
policies, or procedures relating to auctions. Such
Disclosure Report shall be submitted under penalty of
perjury to Chief, Auctions and Spectrum Access Division,
Wireless Telecommunications Bureau, and to Chief,
Investigations and Hearings Division, Enforcement Bureau.
5. Act as a point of contact for all personnel within the
company who have information relating to any matters that
may be self-reported under paragraph 12(d)(ii)(4), above;
6. Investigate and act upon any known or reported matter that
may be self-reported under paragraph 12(d)(ii)(4), above;
and
7. Submit to the Commission in writing a Compliance Report, in
English. Each Compliance Report shall be signed by the
Compliance Officer who shall certify under penalty of
perjury on behalf of the company that the company has been
in compliance during the previous 12 month period with all
provisions of this Consent Decree; all provisions of this
Compliance Plan; all provisions of the Act, and/or the
Commission's rules, regulations, policies or procedures
relating to auctions. If the Compliance Officer is unable
to so certify, he/she shall explain fully and completely
why. Each Compliance Report shall also include a
certification by the Compliance Officer submitting the
report that he/she is familiar with the requirements of the
Act, and the rules, regulations and procedures implemented
in connection therewith related to FCC auction proceedings.
Each such Compliance Report shall be directed to Chief,
Auctions and Spectrum Access Division, Wireless
Telecommunications Bureau, and to Chief, Investigations and
Hearings Division, Enforcement Bureau. The first such
Compliance Report shall be submitted no later than 12
months after the Effective Date. Subsequent Compliance
Reports shall be submitted every 12 months thereafter for
the duration of this Compliance Plan.
13. Voluntary Contribution. PRTC and America Movil collectively agree that
they shall make a voluntary contribution to the United States Treasury in
the total amount of $80,000 within ten business days of the Effective
Date. The payment shall include the NAL/Account Number and FRN Number
referenced in the caption to the Adopting Order. Payment by check or money
order may be mailed to Federal Communications Commission, P.O. Box 979088,
St. Louis, MO 63197-9000. Payment by overnight mail may be sent to U.S.
Bank - Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St.
Louis, MO 63101. Payment by wire transfer may be made to ABA Number
021030004, receiving bank TREAS/NYC, and account number 27000001. For
payment by credit card, an FCC Form 159 (Remittance Advice) must be
submitted. When completing the FCC Form 159, enter the NAL/Account number
in block number 23A (call sign/other ID), and enter the letters "FORF" in
block number 24A (payment type code). PRTC and America Movil shall also
send electronic notification on the date said payment is made to
Hillary.DeNigro@fcc.gov, Gary.Schonman@fcc.gov and
William.Knowles-Kellett@fcc.gov.
14. Waivers. PRTC and America Movil each waives any and all rights it may
have to seek administrative or judicial reconsideration, review, appeal or
stay, or to otherwise challenge or contest the validity of this Consent
Decree and the Order adopting this Consent Decree, provided the Bureau
issues an Order adopting the Consent Decree without change, addition,
modification, or deletion. PRTC and America Movil shall retain the right
to challenge Commission interpretation of the Consent Decree or any terms
contained herein. If any party to this Consent Decree (or the United
States on behalf of the Commission) brings a judicial action to enforce
the terms of the Adopting Order, neither PRTC nor America Movil nor the
Commission shall contest the validity of the Consent Decree or the
Adopting Order, and PRTC and America Movil shall waive any statutory right
to a trial de novo. PRTC and America Movil each hereby agrees to waive any
claims it may otherwise have under the Equal Access to Justice Act, 5
U.S.C. S: 504 and 47 C.F.R. S: 1.1501 et seq., relating to the matters
addressed in this Consent Decree.
15. Subsequent Rule or Order. The Parties agree that if any provision of
the Consent Decree conflicts with any subsequent rule or Order adopted by
the Commission (except an Order specifically intended to revise the terms
of this Consent Decree to which PRTC or America Movil does not expressly
consent) that provision will be superseded by such Commission rule or
Order.
16. Successors and Assigns. PRTC and America Movil each agrees that the
provisions of this Consent Decree shall be binding on its successors and
assigns.
17. Final Settlement. The Parties agree and acknowledge that this Consent
Decree shall constitute full and final settlement between the Parties. The
Parties further agree that this Consent Decree does not constitute and
shall not be construed as (1) an adjudication on the merits; or (2) a
factual or legal finding or determination; or (3) an admission by America
Movil or PRTC regarding any compliance or noncompliance with the
requirements of the Act or the Commission's Rules and/or Orders.
18. Modifications. This Consent Decree shall not be modified without the
written consent of all Parties.
19. Paragraph Headings. The headings of the Paragraphs in this Consent
Decree are inserted for convenience only and are not intended to affect
the meaning or interpretation of this Consent Decree.
20. Authorized Representative. Each party represents and warrants to the
other that it has full power and authority to enter into this Consent
Decree.
21. Counterparts. This Consent Decree may be signed in any number of
counterparts (including by facsimile), each of which, when executed and
delivered, shall be an original, and all of which counterparts together
shall constitute one and the same fully executed instrument.
_________________________________ ______________________________
P. Michele Ellison Date
Chief, Enforcement Bureau
_________________________________ ______________________________
Francisco J. Silva Date
Secretary and General Counsel
Puerto Rico Telephone Company, Inc.
_________________________________ ______________________________
Alejandro Cantu Jimenez Date
Secretary and General Counsel
America Movil, S.A.B. de C.V.
Federal Communications Commission DA 10-1876
2
Federal Communications Commission DA 10-1876