In a hugely significant development, government is poised to liberalise radio frequency spectrum in South Africa, allowing the free trading of spectrum assignments — subject to regulatory conditions.

The latest draft (PDF) of the Electronic Communications Amendment Bill, to be submitted to parliament this week, proposes that spectrum licences can be traded, subject to approval from communications regulator Icasa.

The latest version of the amendment bill does not prescribe limits, and appears to include spectrum suitable for deploying mobile telecommunications networks, including mobile broadband.

According to the latest version of the bill, which will now be debated by lawmakers, Icasa must prescribe spectrum trading regulations within 12 months of the enactment of the legislation. These include the criteria and conditions for trading spectrum assets.

The new bill says competition must not be distorted by any spectrum trade, or through the accumulation and hoarding of spectrum rights of use. Also, licence obligations will be passed on to the new user of the radio frequency spectrum and the current radio frequency spectrum licensee must have used the radio frequency spectrum in the year prior to the spectrum trade to ensure that the trade is not used to subvert “use it or lose it” principles.

Furthermore, current and new radio frequency spectrum licensees must comply with all the relevant legislation and submit to Icasa the particulars of the spectrum trade transaction, including the legal, technical and financial terms and conditions to ensure that the spectrum trade does not undermine government’s policy objectives.

“The minister (of telecommunications & postal services) may issue policy directions to the authority (Icasa) on spectrum trading and spectrum-use rights in order to fulfil specific national objectives,” the new bill says.

Spectrum sharing

The bill also allows for operators to share spectrum. Radio frequency spectrum licensees may share licensed spectrum, subject to various conditions.

These include approval from Icasa in the case of high-demand spectrum (typically used for mobile telecoms) and a simple notification to Icasa in the case of non-high-demand spectrum.

Icasa may not approve spectrum sharing of high-demand spectrum if it will have a negative impact on competition, amount to spectrum trading or compromise emergency services and other services that “meet public interest goals”.