Minister Solly Malatsi defends Icasa's alignment with B-BBEE, says no exemptions have been granted exclusively to Starlink

Communications and Digital Technologies Minister Solly Malatsi has again defended the decision to align the Independent Communications Authority of South Africa (Icasa) regulations with the B-BBEE framework.

In a written response to parliamentary questions from EFF MP Mazwikayise Blose, Malatsi said the draft policy direction he issued to Icasa sought to ensure that regulations aligned with the empowerment framework as envisaged by amendments to the Electronic Communications Act.

He said these amendments shifted the focus from rigid individual equity ownership to a broader approach that includes mechanisms such as Equity Equivalent Investment Programmes (EEIPs) and deemed ownership.

Malatsi said Icasa’s current regulations, which applied a fixed 30% equity rule, did not reflect the broader scope.

“The draft policy direction, therefore, seeks to correct this inconsistency, allowing transformation to be achieved through substantial and measurable EEIP investments that support black-owned businesses, skills development, job creation and economic growth, particularly in rural and underserved areas.”

He also said the legal basis he had relied on to support the amendments rested on the 2014 amended Electronic Communications Act, which empowered Icasa to consider empowerment mechanisms beyond equity ownership.

“This ensures that regulations can embrace the full scope of transformation measures under the B-BBEE Act and ICT Sector Code.”

Malatsi added that the policy direction was informed by recognition that current Icasa regulations have not fully aligned with stakeholder input and broader government policy.

“While the statement does not provide specific consultation reports, it makes clear that alignment with existing government frameworks (such as those administered by the Department of Trade, Industry and Competition) is essential.”

He clarified that no exemptions have been granted exclusively to Starlink.

“The position is that the draft policy direction applies generally and encourages Icasa to implement regulations that reflect the full framework of B-BBEE, including EEIPs and deemed ownership.

“This is not designed for one operator but to ensure that all potential entrants, including multinational firms, participate meaningfully in transformation.”

He stated that EEIPs are proven mechanisms already in use by global firms in South Africa. He made examples of Microsoft’s R1.3 billion programme, Amazon Web Services’ R384 million investment and J.P. Morgan’s R340 million initiative.

“These demonstrate that EEIPs deliver measurable benefits such as enterprise development, skills training, and industry growth,” said Malatsi.

President Cyril Ramaphosa indicated in June that EEIPs were subject to rigorous oversight and must be broad-based in their impact, aligning with national strategic goals, he said.

Malatsi’s responses comes almost two months after EFF MP Sinawo Thambo asked whether his policy directive was intended to specifically cater for Starlink after his meeting with representatives of SpaceX and Starlink.

He had told Thambo that he was encouraging Icasa to recognise and fully apply the full scope of B-BBEE laws, including EEIPs and deemed ownership to ensure that transformation in the sector was meaningful and delivered a measurable and positive impact on the lives of South Africans.

Malatsi said at the time that EEIPs were not a shortcut.

“They require companies to invest the equivalent of 30 percent black ownership into approved programmes that directly build black-owned businesses, create jobs, develop critical skills and strengthen local industries.  These investments must be substantial, targeted and aligned with national transformation objectives.”

Ramaphosa told Parliament a few months ago that what Malatsi had announced was very much in line with the country’s laws. 

“We will always seek to act in accordance with our laws, always seek to act in accordance with our Constitution,” Ramaphosa had said.

mayibongwe.maqhina@inl.co.za