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The Electronic Communications Act: An overview

By Marumo Tshesane – Candidate Attorney

The Electronic Communications Act, 2005 (ECA) took effect on 19 July 2006.  It repealed the Telecommunications Act, 1996 and the Independent Broadcasting Authority Act, 1993.  The ECA was enacted because the line between telecommunication and broadcasting technologies was becoming increasingly blurred, or “converged”.

The ECA regulates both telecommunications and broadcasting, with the object of facilitating the convergence of telecommunication, broadcasting and IT services.  The ECA also aims to promote competition in the ICT sector.  Moreover, the ECA sets out to promote the empowerment of historically disadvantaged people in this sector and to ensure that electronic communications (EC) services and broadcasting services are provided by and to persons from a diverse range of communities.

The ECA provides a framework for the licensing of EC services, electronic communications network (ECN) services and broadcasting services.  A distinction is drawn between three categories of broadcasting services, namely public, commercial and community broadcasting.  In order to provide any of these services, a licence must be obtained from the Independent Communications Authority of South Africa (ICASA), although ICASA has a limited discretion to exempt certain services from the ECA’s licensing requirements.

In each of the abovementioned service categories, a distinction is drawn between individual and class licences, depending on the scope of the service to be provided.  Individual licences are required in respect of services that have a significant impact on socio-economic development.  For example, an individual licence is required in respect of ECN services and commercial and public broadcasting services of national and regional scope, and in respect of EC services consisting of voice telephony using numbers from the national numbering plan. 

Applications for individual licences may only be made in response to an invitation published by ICASA.  Furthermore, ICASA may only consider an application for an individual ECN licence in terms of a policy direction issued by the Minister of Communications.

Class licences, on the other hand, are required in respect of services which ICASA considers do not have a significant impact on socio-economic development.  Persons providing services requiring class license authorisation need only register with ICASA, in the prescribed manner, in respect of those services.

All licences previously issued under the Telecommunications Act and the IBA Act remain valid under the ECA and must be converted by ICASA into licences according with the new service categories.  ICASA has until 18 July 2008 to finalise the conversion process.  Licences are to be converted on terms no less favourable than those originally imposed, but may not include any monopoly rights.  A licence converted in terms of the ECA generally retains its original term of validity.

In March this year, ICASA called upon licensees to comment on the proposed licence conversion framework.   ICASA recently conducted hearings on the proposed terms and conditions for the new licence categories.

The ECA empowers ICASA to direct licensees to refrain from engaging in anti-competitive behaviour.  ICASA may also impose pro-competitive obligations on licensees that are found to have significant market power.

In terms of the ECA, companies in the electronic communications sector are also subject to the general competition laws.  ICASA and the Competition Commission have concurrent jurisdiction in respect of competition issues affecting the sector, and may cooperate with each other in respect of such issues.

The ECA certainly represents a step forward for the liberalisation of the electronic communications market.  Its implementation, however, has imposed significant regulatory burdens on ICASA.  ICASA’s task in giving effect to the ECA is not made any easier by the fact that some of the ECA’s provisions have been formulated in imperfect terms.  The result is that the new regulatory system will take some time to be established.

Friday, November 09, 2007