WASHINGTON, Nov 23 (Reuters) - The U.S. Federal
Communications Commission said two companies are still
ineligible for $3.3 billion in small business bidding credits
for a wireless spectrum auction, after they failed to
demonstrate they are independent entities from DISH Network Corp
Northstar Wireless LLC and SNR Wireless LicenseCo LLC won
43.5% of the wireless spectrum licenses up for bid in a 2015
government auction and had expected to use credits covering 25%
of the $13.3 billion in bids.
After a new review, the FCC said on Monday that "DISH
Network continues to possess de facto control over SNR and
DISH chairman Charlie Ergen said in a statement "the
decision is a setback for an emerging competitor and we are
The FCC first decided in 2015 that the firms, which were 85%
owned by Dish, were ineligible for the small business credits.
The discounts, up to 25% of the bidding costs, are aimed at
helping new entrants compete.
The FCC adopted new rules in 2015 to prevent companies from
using similar tactics in future auctions.
After being denied the credits, Northstar and SNR did not
complete all spectrum purchases.
"We are discouraged that the agency declined multiple
meeting requests over the past two-and-half years so that
Northstar and SNR's applications could be further amended if for
any reason they were found to imply de facto control," Ergen
The FCC noted Monday that despite changes "the fact remains
that DISH provided Northstar and SNR with approximately $13
billion in loans to participate" in the spectrum auction.
A U.S. appeals court in 2017 said the FCC reasonably found
DISH exercised "de facto" control over the companies, but had to
offer an "opportunity" for the firms to renegotiate agreements
with DISH that could give them enough independence to satisfy
The FCC said Northstar and SNR are subject to additional
potential default payments when those licenses are auctioned in
(Reporting by David Shepardson
Editing by Chris Reese and Richard Pullin)