Solly Malatsi, minister of communications and digital technologies, has refuted suggestions that the policy direction he gazetted on Friday (23 May 2025) was a direct result of President Cyril Ramaphosa’s White House meeting.
“There is no conspiracy on our part; no underhanded effort in darkness to railroad this into the South African public,” he told the Parliament’s Portfolio committee on Communications and Digital Technologies
Today.
“People are always going to have different views about timing,” he says. “But we have communicated the process and are comfortable that the state we in now is a legitimate one.”
He stresses that the policy direction that calls for broadcasting and telecommunications operators to have access to the same equity equivalence provisions as IT players in fulfilment of the Broad-Based Black Economic Empowerment (B-BBEE) requirements.
“We are not attempting to open a special dispensation for StarLink, but to make provision for the two choices that exist for every other company in the ICT sector. The ultimate intention is to align with B-BBEE regulations.”
Malatsi says one of the most pressing issues in South Africa is broadband connectivity, and extending this to as many people as possible. “This policy direction has the intention of driving down data costs and promoting universal access.”
Malatsi outlines the process that has already been taken. “We started work on this around September last year, and on 4 October released communication to the Independent Communications Authority of South Africa (Icasa) expressing out intention of releasing a policy direction, and giving them an opportunity to engage.
“This was followed by public communication on that day.”
The policy direction gazetted last week followed these engagements, with the process initially anticipated to be finalised by the end of 2025.
“My duty is to ensure there is alignment in the codes,” Malatsi says. “I believe that we have followed the processes that a ministerial policy directive should, and have consulted with Icasa.”
The policy is now open for public comment, for 30 days, and any change in policy direction will take into account the views of stakeholders.
“In the end, the Icasa regulations may continue as they are if the authority chooses. But what is must do is to commit to consider equity equivalence.”
Webber Wentzel’s TMT team has prepared this analysis of the policy directive:
On 23 May 2025, the Minister of Communications and Digital Technologies published a draft policy direction for the Independent Communications Authority of South Africa (ICASA).
The direction calls on ICASA to urgently consider aligning the ownership principles in the generic and ICT Sector Codes of Good Practice (B-BBEE Codes) (published under the Broad-Based Black Economic Empowerment Act 53 of 2003 and administered by the Minister of Trade, Industry and Competition), and ICASA’s Ownership and Control Regulations (published in 2021). Members of the public have until 7 July 2025 to submit comments (via email to bbbee@dcdt.gov.za) on the draft policy direction.
Currently, telecommunications and media licensees in South Africa must apply one set of rules to measure ownership by historically disadvantaged people (HDPs) under ICASA’s rules and a different approach when they get their BBBEE certificates to measure ownership by Black people under the BBBEE Codes.
Alignment between the two frameworks would clarify how telecommunications and media licensees should calculate and measure the extent of their ownership by Black people/HDPs for purposes of compliance with ICASA’s regulations and would presumably allow telecommunication licensees to rely on all the provisions of the BBBEE Codes for the purposes of fulfilling ICASA’s requirements.
Many incumbent local fibre network operators and mobile network operators, as well as international players seeking to enter the South African market, have sought clarity on this topic from ICASA over the last few years and in their engagements with ICASA on its draft ownership and control regulations in 2020.
ICASA’s regulations require individual licensees to be at least 30% owned by historically disadvantaged people (ie Black people as defined in the B-BBEE Act, women, youth and persons with disabilities), and to be a Level 4 B-BBEE contributor.
There is a separate requirement for individual licensees to also be 30% owned by Black people specifically, but this requirement is not yet in force. Class licensees need to be Level 4 B-BBEE contributors but don’t need to comply with any minimum equity ownership percentage.
ICASA requires licensees to submit a copy of their B-BBEE certificates annually, to demonstrate compliance with these requirements. There may, however, be instances where the percentage of Black ownership reflected in a licensee’s B-BBEE certificate might not be aligned with ICASA’s regulations– for example, where a licensee has relied on any of the deeming principles in the B-BBEE Codes to calculate its Black ownership.
These principles include (amongst others) the exclusion of ownership held by institutional investors, the exclusion of the value of foreign assets, the B-BBEE private equity fund deeming principle, the continuing consequences principle, the sale of assets principle, and the equity equivalent principle. Although ICASA has stated that some deeming principles from the B-BBEE Codes can’t be applied to measure HDP ownership for purposes of complying with its rules, its position on some of the other principles is less clear.
Alignment between the ICASA rules and the B-BBEE framework would allow licensees to measure the extent to which Black people have an ownership interest (or deemed ownership interest) based on a single set of rules.
After receiving comments on the draft policy direction, the minister will have to consider whether to make any changes before issuing it to ICASA. ICASA will then have to consider the policy direction and decide whether to amend its regulations. If ICASA does elect to amend its regulations, this process would also be subject to public participation process.