Innovation, Science and Economic Development Canada (ISED) manages spectrum to maximize its economic and social benefit for Canadians. Auctions are a competitive licensing process generally used to award spectrum licences when the demand for spectrum is expected to exceed supply. This page describes the auction process and different auction formats, and provides access to general frameworks.
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Auction process
Auctions
Before a major spectrum auction begins, a public consultation process takes place to determine its attributes and design, such as the exact frequency ranges to be auctioned, the number and size of frequency blocks, reserve prices, and measures to support competition. Once an auction begins, it can take several weeks of bidding before it concludes. Spectrum auctions follow the process described in the Framework for Spectrum Auctions in Canada and generally take place according to the steps below.
1. Consultations on the proposed policy and licensing procedures
A public consultation paper is published seeking comments on all aspects of the upcoming auction. This consultation outlines the proposed spectrum policy, auction design, and licensing procedures and rules. The consultation process provides interested parties with the opportunity to review and comment on these proposals before the auction framework is finalized.
2. Comment period
During this time, interested parties can submit written comments on the proposed auction design and rules. Any interested parties, including potential bidders, industry associations, public interest groups and private citizens, may participate. After the closing date for receipt of comments, copies of all comments received are posted on ISED’s website.
3. Reply comment period
During this time, interested parties can respond to comments submitted during the initial comment period. This provides an opportunity for parties to address concerns or refine proposals based on input from other interested parties. After the closing date for receipt of reply comments, copies of all reply comments received are posted on ISED’s website.
4. Publication of the auction framework decision
After all comments have been reviewed and considered, ISED publishes the final auction framework. This framework discusses the comments received from the consultation process and describes ISED’s decision on the auction format, bidding rules and licence conditions. ISED also publishes a table of key dates associated with the auction.
5. Clarification questions
Once the auction framework has been published, interested parties have a window of opportunity to submit written questions asking for clarification of rules or policies related to the auction. Questions received and ISED’s answers to these questions are published online.
6. Deadline for the receipt of applications
Prospective auction participants must submit their completed application forms, supporting documentation and financial deposit by the published deadline. The specific application requirements are detailed in the auction framework.
7. Publication of the list of applicants
Shortly after the application submission deadline, ISED publishes a list of all applicants, as well as information about their beneficial ownership, affiliations and associations. This step does not imply that applicants have been qualified to participate in the auction.
8. Publication of the list of qualified bidders
Following the review of applications, ISED publishes the official list of qualified bidders. Qualified bidders subsequently receive training materials and a schedule for the first week of the auction.
9. Bidder information and practice sessions
Prior to the auction, ISED provides qualified bidders with training to become familiar with the auction rules, software platform and bidding procedures. Bidders also participate in practice sessions with the auction software to ensure they will not have any technical issues during the auction.
10. Start of auction
The auction starts on the date specified in the auction’s table of key dates.
11. Conclusion of auction
The duration and conclusion of an auction are not fixed prior to the auction, and will depend on the format of the auction as well as its bidding activity. Details on when ISED will conclude the auction are provided in the framework.
12. Publication of provisional licence winners
Shortly after the conclusion of the auction, ISED publishes the provisional results, including provisional winning bidders, licences won and prices to be paid. Results are not considered final until all payments have been received.
13. Initial payment deadline
Provisional winners must submit a first payment, as specified in the auction framework, by the published deadline. Failure to do so may result in forfeiture of licences won.
14. Final payment deadline
Provisional winners must submit their final payment (balance owing) by the published deadline. Failure to do so may result in forfeiture of licences won.
15. Issuance of licences
Once provisional winning bidders have submitted all payments, on the final payment deadline, their licences are issued. At this time, all auction results are deemed final.
16. Publication of bidding data
A few months after issuing licences, ISED publishes detailed bidding data, which includes bidders' identities and all bids submitted for the concluded auction. This is done to ensure the transparency of the auction process.
Residual Auctions
Residual auctions are auctions of licences that remain unallocated at the conclusion of an auction, or of previously assigned licences that have been returned to ISED. Residual auctions follow the process described in the Streamlined Framework for Auctioning Residual Spectrum Licences, and generally do not require a consultation process.
The process for residual auctions generally follows the steps below.
1. Publication of notice
ISED publishes a formal notice announcing an upcoming auction of residual licences. The notice details the auction format and bidding rules (generally a sealed-bid auction with a second-price rule). ISED also publishes a table of key dates associated with the residual auction.
2. Clarification questions
Interested parties have a window of opportunity to submit written questions asking for clarification of rules related to the residual auction. Questions received and ISED’s answers to these questions are published online.
3. Deadline for the receipt of applications
Prospective auction participants must submit their completed application forms, supporting documentation and financial deposit by the published deadline. The specific application requirements are detailed in the residual auction notice.
4. Publication of the list of applicants
Shortly after the application submission deadline, ISED publishes a list of all applicants, as well as information about their beneficial ownership, affiliations and associations. This step does not imply that applicants have been qualified to participate in the residual auction.
5. Publication of the list of qualified bidders
Following the review of applications, ISED publishes the official list of qualified bidders. Qualified bidders subsequently receive an information package.
6. Start of residual auction (sealed bid deadline)
The deadline for submission of sealed bids marks the start of the residual auction. This deadline is specified in the residual auction’s table of key dates.
7. Conclusion of residual auction
The conclusion of the residual auction will depend on its design and format, but a residual auction will generally conclude within two weeks.
8. Publication of provisional licence winners
Shortly after the conclusion of the residual auction, ISED publishes the provisional results, including provisional winning bidders, licences won and prices to be paid. Results are not considered final until all payments have been received.
9. Initial payment deadline
Provisional winners must submit a first payment, as specified in the residual auction notice, by the published deadline. Failure to do so may result in forfeiture of licences won.
10. Final payment deadline
Provisional winners must submit their final payment (balance owing) by the published deadline. Failure to do so may result in forfeiture of licences won.
11. Issuance of licences
Once provisional winning bidders have submitted all payments, on the final payment deadline, their licences are issued. At this time, all residual auction results are deemed final.
12. Publication of bidding data
A few months after issuing licences, ISED publishes detailed bidding data, which includes bidders' identities and all bids submitted for the concluded residual auction. This is done to ensure the transparency of the auction process.
Auction formats
Over time, ISED has used a number of formats for its major spectrum auctions. The specific format ISED uses is subject to consultation and depends on the amount and characteristics of the spectrum to be auctioned, as well as ISED’s policy objectives.
Clock auction (CA) format
The clock stage determines the number of generic blocks of spectrum that a bidder will win and the price for these blocks. The assignment stage determines the specific frequencies that will be assigned to each winning bidder and the additional price for the specific frequencies.
As an example, this format is detailed in section 10 and annexes D and E of the Consultation on a Policy and Licensing Framework for Spectrum in the 3800 MHz Band.
Combinatorial clock auction (CCA) format
The combinatorial clock auction format is a bidding process that allows bidders to bid on packages of licences instead of individual licences, eliminating the risk that bidders may win some but not all of the licences that they desire.
The CCA includes an allocation stage and an assignment stage. The allocation stage starts with clock rounds, which are designed to help bidders learn about the demand for different generic spectrum blocks and reveal their own preferences in a process of price discovery. The clock rounds are followed by a supplementary round, which provides bidders the flexibility to submit bids on additional packages of interest for which they were unable to express during the clock rounds. All bids during the clock and supplementary rounds are binding and are used in determining the winners and the prices to be paid. During the assignment stage, bidders submit bids on specific frequencies for the generic blocks they won in the allocation stage.
As an example, this format is detailed in section 7 and annex C of the Technical, Policy and Licensing Framework for Spectrum in the 600 MHz Band.
Simultaneous multiple-round ascending auction (SMRA) format
With this auction format, specific licences (which include service areas and frequencies) are offered simultaneously in a single stage. Bidding is organized into a series of rounds, and information on the bids placed by all bidders is made available after each round. ISED sets the bid increments and bidders simply opt in or out of bidding.
As an example, this format is detailed in section 6 and appendix B of the Licensing Framework for the Auction for Spectrum Licences for Advanced Wireless Services and other Spectrum in the 2 GHz Range.
Sealed-bid format
This format is generally used for residual auctions. In a sealed-bid auction, bidders simultaneously submit sealed bids on the licence(s) they are interested in so that no bidder knows the bids of any other participant. This format also uses a second-price rule, where winning bidders pay the amount of the second-highest bid or the reserve price.
As an example, this format and the second-price rule are detailed in section 8 and annex B respectively of the 2024 Notice of Upcoming Auction of Residual Spectrum Licences.
Auction frameworks
Framework for Spectrum Auctions in Canada
The general approaches ISED uses to auction spectrum licences.
Decision on a Streamlined Framework for Auctioning Residual Spectrum Licences
ISED’s streamlined approach for auctioning residual spectrum licences.