Thursday, December 04, 2008

The Independent Communications Authority of South Africa (ICASA), the regulator for the country’s communications sector, has come a long way since 19 July 2006, when the Electronic Communications (EC) Act was enacted.
Even so, with the 19 January 2009 deadline for licence conversions now looming large, the crucial question being posed is whether or not ICASA will meet the deadline.
The EC Act, which repealed the Telecommunications Act, 1997 and most of the then existing broadcasting legislation, provides for a converged licensing regime, though all licences issued in terms of the Telecommunications Act will remain valid until converted. The deadline for conversion, in terms of section 92(6), is 19 January 2009.
Under the Telecommunications Act, licence categories included, amongst others:
·        Public Switched Telecommunication Services (PSTS);
·        Mobile Cellular Telecommunication Services (MCTS); and
·        Value Added Network Services (VANS).
Under the EC Act, the licence categories of electronic communications (telecommunications and broadcasting) services include only:
·        Electronic communications network services (ECNS);
·        Electronic communications services (ECS); and
·        Broadcasting services.
The difference between ECNS and ECS can be determined by the definitions found in the EC Act. ECNS entails making available a network to an ECS or ECNS licensee or exempt service provider, whereas ECS is a service made available to the public or subscribers conveyed over an ECN.
ECNS and ECS licences will either be individual or class licences. Those services for which individual licences are required include:
·        Communications networks (ECNS) of national or provincial scale operated for profit;
·        Voice telephony communications services (ECS) that use numbers from the national numbering plan; or
·        When an entity providing ECS or ECNS is more than 25% state-owned.
Class licences include communications networks (ECNS) of municipal scale operated for profit.
ICASA may also exempt some services from licensing. On 29 July 2008 ICASA published two sets of licence exemption regulations:
·        Licence Exempt Electronic Communications Networks (ECN), ECNS and ECS Regulations; and
·        Spectrum Licence Exemption Regulations.  
Resale of ECS, non-profit ECS and ancillary services are exempt. Ancillary services are defined as services which are not ECS, including tracking, alarm and similar services.
The ECN that are exempt from licensing are small networks and private networks. While private networks used to be licensed as PTNs, networks that are an integral part of a business will no longer require a licence. 
A small network is defined as one confined to a limited spatial area, used by a specified user group and includes local area networks (LAN) and wireless LAN.
Both sets of exemption regulations came into force 30 days after 9 September 2008.
Chapter 15 of the EC Act provides for the continued existence of all existing licences and the conversion of licences on no less favourable terms.
Section 93(4)(a) states that where existing licensees have the right to operate facilities or networks, ICASA must issue those licensees with an ECNS licence. This issue, as it relates to VANS, has become commonly known as ‘self-provisioning’.
It was contested, for months, in Altech Autopage v ICASA and the Minister of Communications and Others. In November 2008 the High Court of Pretoria dismissed the Minister’s application for leave to appeal against an earlier finding, in favour of Altech and self-provisioning, with costs.
ICASA subsequently published as draft regulations its resolution to convert all VANS licences to ECNS licences, including those ones issued after 19 July 2006. The draft regulation, open for public comment until 5 December 2008, states that conversion of VANS licences will be completed by 19 January 2009.
The deadline seems in reach, especially since the Minister has decided not to petition the Supreme Court of Appeal.
On 24 June 2008, ICASA published draft licences for certain individual licences, but did not include SNG or trunking licences.
SNG and radio trunking is not defined in repealed legislation or the EC Act. However, ICASA has proposed to convert the licences by Notice 1257 of 4 October 2007. An SNG licence was to be converted to a class ECNS licence unless:
·        Provincial or national in scope; or
·        Where a state entity has an ownership interest of 25% or more.
Because SNG is an international network comprising mobile (vans with satellite equipment) and fixed (earth stations in at least two countries) elements providing international news casting, the network element of an SNG licence should be converted to an individual ECNS (i-ECNS) licence. 
ICASA did not propose converting SNG licences to ECS licences because an SNG network only transmits broadcasting content, which is not regarded as ECS. It is not broadcasting either, because it does not transmit to ‘the public or sections thereof or subscribers to a broadcasting service’, but rather to another broadcaster, which then broadcasts the relayed content.
While ICASA has proposed creating a new licence category for this service, it falls outside the EC Act licensing regime. The exclusion is contemplated in the definition of ECS, which expressly excludes content services.
On radio trunking services, ICASA proposed a conversion to i-ECS and i-ECNS licences, provided it met the EC Act requirements.
Since trunking services use networks of national scope, their conversion to i-ECNS licences is not contentious. Its conversion to ECS is not clear-cut. Trunking is a radio communication technique that makes electronic communication more cost effective by enabling transmissions to be served by free channels, whose availability is determined by algorithmic protocols. This does not amount to ECS, in my opinion.
As most licence conversion issues are complete, most licences can and are being issued. The two categories that remain are SNG and radio trunking; licences which I propose should be converted to i-ECNS licences only, because the services provided over the networks are not ECS or broadcasting, as defined.
The 19 January 2009 deadline for licence conversions now looms large. It is entirely within ICASA’s reach – if it chooses the path of less regulation, rather than more.
Carmen Cupido is an Associate at commercial law firm Bowman Gilfillan