§  1.21002   Prohibition of certain communications during the competitive
bidding process.

   (a) Definitions. For purposes of this section:

   (1) The term “applicant” shall include all controlling interests in the
   entity submitting an application to participate in a given auction, as
   well as all holders of partnership and other ownership interests and
   any stock interest amounting to 10 percent or more of the entity, or
   outstanding stock, or outstanding voting stock of the entity submitting
   the application, and all officers and directors of that entity. In the
   case of a consortium, each member of the consortium shall be considered
   to have a controlling interest in the consortium; and

   (2) The term bids or bidding strategies shall include capital calls or
   requests for additional funds in support of bids or bidding strategies.

   (b) Certain communications prohibited. After the deadline for
   submitting applications to participate, an applicant is prohibited from
   cooperating or collaborating with any other applicant with respect to
   its own, or one another's, or any other competing applicant's bids or
   bidding strategies, and is prohibited from communicating with any other
   applicant in any manner the substance of its own, or one another's, or
   any other competing applicant's bids or bidding strategies, until after
   the post-auction deadline for winning bidders to submit applications
   for support.

   (1) Example 1. Company A is an applicant in area 1. Company B and
   Company C each own 10 percent of Company A. Company D is an applicant
   in area 1, area 2, and area 3. Company C is an applicant in area 3.
   Without violating the Commission's Rules, Company B can enter into a
   consortium arrangement with Company D or acquire an ownership interest
   in Company D if Company B certifies either:

   (i) That it has communicated with and will communicate neither with
   Company A or anyone else concerning Company A's bids or bidding
   strategy, nor with Company C or anyone else concerning Company C's bids
   or bidding strategy, or

   (ii) That it has not communicated with and will not communicate with
   Company D or anyone else concerning Company D's bids or bidding
   strategy.

   (2) [Reserved]

   (c) Internal controls required. Any party submitting an application for
   a given auction that has an ownership or other interest disclosed with
   respect to more than one application for an auction must implement
   internal controls that preclude any individual acting on behalf of the
   applicant as defined in paragraph (a)(1) of this section from
   possessing information about the bids or bidding strategies as defined
   in paragraph (a)(2) of this section of more than one party submitting
   an application for the auction or communicating such information with
   respect to a party submitting an application for the auction to anyone
   possessing such information regarding another party submitting an
   application for the auction. Implementation of such internal controls
   will not outweigh specific evidence that a prohibited communication has
   occurred, nor will it preclude the initiation of an investigation when
   warranted.

   (d) Modification of application required. An applicant must modify its
   application for an auction to reflect any changes in ownership or in
   membership of a consortium or a joint venture or agreements or
   understandings related to the support being sought.

   (e) Duty to report potentially prohibited communications. An applicant
   that makes or receives communications that may be prohibited pursuant
   to paragraph (b) of this section shall report such communications to
   the Commission staff immediately, and in any case no later than 5
   business days after the communication occurs. An applicant's obligation
   to make such a report continues until the report has been made.

   (f) Procedures for reporting potentially prohibited communications. Any
   report required to be filed pursuant to this section shall be filed as
   directed in public notices detailing procedures for the bidding that
   was the subject of the reported communication. If no such public notice
   provides direction, the party making the report shall do so in writing
   to the Chief of the Auctions Division, Office of Economics and
   Analytics, by the most expeditious means available, including
   electronic transmission such as email.

   [ 85 FR 75816 , Nov. 25, 2020]