South Africa’s ICT legal mess

Werksmans director and head of regulatory Ahmore Burger-Smidt has said that the new communications minister’s hopes of changing the litigious nature of the ICT sector will require vigorous engagement between regulators and the private sector.

Following his appointment as minister of communications and digital technologies, Solly Malatsi announced this as one of his priorities in the new role.

“Communications is a sector that is huge, has competing interests that often are litigious. I believe that some of the differences, deadlocks and impasses that exist in the sector can be resolved with a very proactive approach to stakeholder engagement,” Malatsi recently told the Sunday Times.

Burger-Smidt says that this litigation Malatsi is referring to is a reaction to government actions and policies rather than between companies within the private sector.

An example of such litigation is eMedia filing court papers against former communications minister Khumbudzo Ntshavheni after she proclaimed her intention to shut off South Africa’s old analogue TV signals.

According to eMedia, Ntshavheni risked cutting off millions of indigent South Africans’ access to TV. This would not only be detrimental to those households, but also the broadcasters reliant on that audience for their advertising revenue.

“We must be reminded that government regulations in telecommunications, data protection, cybersecurity, and other areas can impact how IT and communications companies operate,” Burger-Smidt said.

“One ought to expect disputes to arise if companies believe that government regulations are unjust, overly burdensome, or inconsistently applied.”

Burger-Smidt also mentions that policy changes can have significant implications for the ICT sector, but that litigation is always the last resort.

Companies will engage in litigation because they have a responsibility to their shareholders to mitigate the impact of regulatory decisions.

Vodacom taking the Independent Communications Authority of South Africa (Icasa) to court over spectrum pooling agreements the regulator approved between its competitors is a recent example of this.

In this case, Vodacom accused Icasa of allowing MTN to pool spectrum belonging to Cell C and Liquid Intelligent Technologies with its own, giving it a substantial competitive advantage.

Vodacom also argued that the pooling agreements constitute notifiable mergers that should have been lodged with the Competition Commission.

Burger-Smidt said that the private sector also has to mitigate government interventions in market competition, along with licensing issues and enforcement actions.

“More robust engagement between regulators and the private sector in formulating policy and legislation could very well assist in negating the necessity for litigation,” she said.

She shares this view with Malatsi, who said that a proactive approach to stakeholder engagement could resolve some of the sector’s disputes and impasses.

Apart from litigation within the sector, Malatsi also has a number of other major industry issues in his new portfolio, such as the analogue switch-off, which is scheduled for December.

South Africa’s migration to digital terrestrial television and the switch-off of old analogue TV broadcasts initially had a 2011 deadline.

Poor leadership at the Department of Communications, vested interests, and constant litigation delayed the migration for over a decade.

The constant delays had huge ramifications, as the old television signals occupied radio frequency spectrum that South Africa’s mobile networks could have otherwise used.

It also hurt electronics producers like Altron and Ellies, who were involved in the manufacturing and distribution of decoder-like set-top boxes needed for old TV sets to receive the new digital signal.

Only since Gungubele and his predecessor, Khumbudzo Ntshavheni, was significant progress made in switching off South Africa’s old analogue television signals.

Ntshavheni also made progress on releasing new spectrum and announced the shutdown of South Africa’s 2G and 3G networks in 2022. She then passed the ball to Gungubele.

Gungubele was appointed as communications minister in March 2023 when Ramaphosa reshuffled his cabinet.

The two effectively swapped roles during the March 2023 reshuffle, with Ntshavheni taking over Gungubele’s old post in The Presidency.

During his time as minister, Gungubele set final deadlines for the broadcast digital migration project, announcing 31 December 2024 as the day all analogue TV broadcasts will be switched off.