ICASA Must Unleash Industry Growth by Stepping Back

16 August 2021

The Internet Service Providers’ Association of South Africa (ISPA) has called on the Independent Communications Authority of SA (ICASA) to reconsider the extent to which it micromanages the affairs of licensees and the industry.

ISPA acknowledges that ICASA has an important role to play in transforming the ICT sector through its regulations mandating transformation through equity ownership and the application of the ICT Sector Code.

“However, when it comes to commonplace business transactions within the industry, we believe the regulator is over-regulating by inserting itself into and delaying commercial deals involving the transfer of a licence or transfer of control over a licence”, says Dominic Cull, ISPA regulatory advisor.

Mr Cull explained that transfers of ownership of or control over licences take ICASA up to 180 working days to process and cost an applicant in the region of ZAR70 000 per licence. ISPA has received feedback from its members that includes examples of delays of more than a year to get ICASA’s approval for changes to internal shareholder arrangements.

“In practice, parties may reach a commercial agreement but must then wait for up to 180 working days to get approval from a regulator. This is clearly at odds with reasonable commercial practice and acts as an impediment to growth and transformation of the sector by disincentivising investment and entry into the sector.”

According to ISPA this kind of micromanagement may have been appropriate when the number of licensees was limited, but it is no longer necessary now that there are more than 500 individual licensees authorised to deploy networks and provide services across South Africa.

“The Competition Commission is well aware of levels of concentration of ownership and control in the sector and already plays the role of ensuring that transfer of ownership or control of a licence does not have anti-competitive effects: there is no need for ICASA to adopt an expansive attitude to its role.”

ISPA will lobby for any legislative changes which may be required to reduce ICASA’s role but requests that ICASA in the interim consider any measures it can take to reduce the time taken to process applications for transfer of ownership or control over licenses.