FCC Clarifies Procedure for Disbursing Reverse Auction Incentive Payments

In response to a number of comments and inquiries, the Wireless Telecommunications Bureau clarifies the circumstances under which the Commission will accept payment instructions to make incentive payments to an entity other than a winning reverse auction bidder. The Commission has stated that incentive payments will be disbursed “to the licensee that is the reverse auction applicant” and that, in making such disbursements, it will “follow winning reverse auction bidders’ payment instructions as set forth on their respective standardized incentive payment forms to the extent permitted by law.” We clarify that the winning reverse auction bidder need not be the owner of the account to which disbursement is made. Winning bidders may instruct that their payments be disbursed to a third party, such as a “qualified intermediary,” a “qualified trust,” an escrow account, or an account jointly owned by parties to a channel sharing agreement (CSA) who are named as owners of that account. The flexibility to instruct that payments be disbursed to a third party will facilitate channel sharing and thereby promote voluntary broadcaster participation in the reverse auction.