Malatsi defends ICT rules: ‘No favouritism for Starlink’
Communications Minister Solly Malatsi has defended his department’s recently gazetted policy directive in Parliament, stressing that it is about legal compliance and transformation, not special treatment for any company.
The directive aims to formally recognise Equity Equivalent Investment Programmes within the ICT sector.
However, it has faced criticism for allegedly violating the Electronic Communications Act (ECA) and appearing to favour Starlink, the satellite internet company owned by South African-born billionaire Elon Musk.
Speaking before Parliament’s Portfolio Committee on Communications on Tuesday, Malatsi explained that the directive forms part of a long-standing plan to align licensing regulations with the Broad-Based Black Economic Empowerment (B-BBEE) framework.
The draft directive was published shortly after President Cyril Ramaphosa’s return from Washington and seeks to remove regulatory obstacles that have thus far prevented Starlink from operating in South Africa.
A significant policy shift could soon allow Starlink and similar satellite services to operate legally without meeting the 30% Black Economic Empowerment equity ownership requirement.
Malatsi dismissed claims of secret deals, stating, “We are not attempting to open a special dispensation for Starlink or any other company or an individual.”
“We are saying that the regulations in our sector must consistently make provision for the two choices that exist in any other sector, the 30% local ownership or the pathway of equity equivalence.”
The minister detailed that the government is advancing a policy directive to harmonise ICT sector codes with ownership regulations related to telecommunications licenses.
“The directive, issued under the Electronic Communications Act, particularly section 3, empowers the minister to issue policy directives to the regulator, ICASA, consistent with the Act and national policies. This framework ensures alignment between sector-specific regulations and broader economic empowerment laws,” Malatsi said.
He added, “Key to the directive is the requirement that ownership of licenses by historically disadvantaged individuals (HDIs) must be no less than 30%, or as prescribed under section 43K of the ICASA Act.”
“This aligns with the ICT sector codes introduced under the Broad-Based Black Economic Empowerment Act in 2013, designed to promote transformation across telecommunications, broadcasting, and related sectors.”
Malatsi explained, “The ICT sector codes, approved in 2016, include provisions for ownership, management control, skills development, and enterprise and supplier development. The directive also formalises the use of equity equivalent programs, a longstanding regulatory tool approved by the Department of Trade, Industry and Competition.”
He emphasised that while ICASA holds the authority to amend ownership regulations independently, such changes must remain consistent with the ICT sector codes and national empowerment policies.
“The current process includes a public comment period following the recent gazette publication, during which multiple stakeholders are expected to submit views. The ministry will consider these inputs before finalising the policy directive.”
Addressing concerns about timing and transparency, Malatsi said, “The process began well before recent developments, aiming for policy finalisation around mid-2025. There is no intention to fast-track or obscure the policy-making process.”
He acknowledged calls for amending the ECA but maintained that the policy directive remains the most effective immediate tool.
“Nonetheless, broader amendments to the ECA are under consideration to address various sector needs comprehensively.”
“The overarching goal remains to expand broadband connectivity across South Africa while ensuring full compliance with the country’s transformation policies,” said Malatsi.
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