New laws bringing big changes for mobile networks in South Africa

 ·27 Jun 2023

The Electronic Communications Amendment Bill has been published for comment and aims to introduce an array of significant amendments to the Electronic Communications Act (ECA).

The bill, if signed into law, will make some significant changes to South Africa’s communications industry, empowering regulating authority ICASA to share spectrum licences and enforce competition rulings, while also introducing regulations for mobile virtual networks in the country and forcing bigger operators to open up to them.

Interested parties have until Sunday, 23 July 2023 to make submissions on the laws.

According to Ahmore Burger-Smidt, Head of Regulatory Practice at Werksmans Attorneys, the new laws will have a big impact on the industry as a whole, with substantial changes to the ECA in tow.

“Some of the above aims could arguably be welcomed by industry participants, but others require scrutiny,” she said.

“What is apparent from the proposed amendments is that the ECA will be impacted to a substantial degree. It is, therefore, paramount that businesses be mindful of the proposed amendments and are aware of the impact they may have in the future.”

The legal expert broke down the most significant changes in the bill and their potential impact:

1. New license category 

The object of these new license categories is to bring electronic communications service providers, such as tower companies, within the licensing framework of the Act.

These facilities will subsequently have wholesale regulations and licensing conditions imposed against them.

2. The standard by-law

This amendment proposes a uniform wayleave process where the instalment of electronic communications networks and facilities by telecoms providers for a tenant via an agreement with the landlord will be enabled by the rapid deployment across municipalities. 

3. Spectrum sharing 

This amendment essentially allows ICASA to share the spectrum of licensees who have failed to use their spectrum for a period of two years with licensees in under-serviced areas. ICASA will be mandated to prioritise the assignment of unused spectrum to community networks.

ICASA will have to approve any sharing of high demand spectrum due to the importance of mobile competition but may also need to be notified of spectrum that is not in high demand. The Bill prescribes that when ICASA is determining the potential competition impact, they may consult the Commission. 

4. MVNO services

An electronic communications network service licensee with access to International Mobile Telecommunications radio frequency spectrum, with network coverage of 90% of the population will have to provide roaming and MVNOS.

This amendment aims to address what is perceived to be roaming arrangements are not competitively priced and that  contribute to raising rivals’ costs. Furthermore, it is the view that MVNOS are not well developed in South Africa due to lack of incentives by larger networks to provide access.

The aim of the Bill is to remove barriers to MVNOS operations and to introduce competitive benefits. It is expected by the authority that based on the outcome of the Bill that the number of MVNOS may increase, which will require an appropriate regulatory framework. 

5. Roaming 

There are new provisions which will be made for international roaming such as SADC roaming regulations.

The Bill aims to empower ICASA to prescribe regulations which regulate the roaming agreements and pricing with international service providers. 

6. Facilities leasing framework

In terms of the Bill, licensees will be regulated and will have to lease facilities. The amendment will  replace the reasonability test for access with principles of access prescribed by ICASA. Therefore, when ICASA denies access, consideration would be in terms of reasonableness but rather the principles of access. 

The principles of access will be prescribed by ICASA and once a facility is listed as essential, access will be compulsory. There is also an amendment dealing with wholesale price regulation which allows ICASA to prescribe pricing rules applicable to different types of electronic communications facilities, essential facilities, roaming and MVNOs.

These pricing regulations must be fair, reasonable, non-discriminatory, cost effective and must reflect competitive commercial arrangements.

7. Competition Regulation 

This Bill prescribes that ICASA may conduct a market enquiry if there is reason to believe that any market segment impedes or restricts competition in its area. ICASA will be able to determine actions which will remedy any adverse effects on competition.

The objective of this proposed amendment is to improve the market review process in line with the market inquiry process of the Competition Act 89 of 1998.

This provision will allow ICASA and the Commission to enforce one another’s findings with the envisaged aim to promote competition. The implication of this will be that once a competition finding is made by the Commission, an inquiry will not need to be repeated by ICASA.

ICASA will also be able to perform competition assessments as part of its licensing functions and will have the power to prescribe regulations which will determine the relevant processes and procedures.

  • By Ahmore Burger-Smidt, Head of Regulatory Practice at Werksmans Attorneys 

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