Communications regulator Icasa has formally signalled that it cannot give full effect to communications minister Solly Malatsi’s December 2025 policy direction on broad-based black economic empowerment without an amendment to the Electronic Communications Act (ECA).
In a brief media statement on Wednesday, the regulator said it had communicated its position to the ministry and remained committed to advancing transformation in the sectors it regulates. But it set a clear limit on what it can do under the current law.
“While the amended ICT sector code must be applied in licensing qualification criteria, full alignment with all provisions of the code, including equity equivalent investment programmes, would require a legislative amendment to the current ECA,” Icasa said.
The statement amounts to regulatory pushback on the central mechanism of Malatsi’s reform – the recognition of equity equivalent investment programmes (EEIPs) as an alternative to the 30% historically disadvantaged ownership requirement for individual licence holders set out in the ECA.
Icasa’s statement comes a day after Malatsi told parliament in his budget vote speech that the government would “pursue legislative amendments that will enable equity equivalent investment programmes to complement ownership requirements in telecommunications”.
The policy direction is widely understood to have been designed to clear a path to licensing for Elon Musk’s Starlink satellite broadband service, which has been stalled in South Africa because SpaceX has refused to cede 30% equity to historically disadvantaged groups as currently required under the ECA. Other telecoms providers would also have benefitted.
EEIPs
Malatsi first signalled his intention to reform the empowerment rules in October 2024, arguing the 30% equity requirement was deterring foreign direct investment in the sector. EEIPs – alternative empowerment mechanisms lawful under the B-BBEE Act and administered by the department of trade, industry & competition – allow multinationals to invest in areas like skills development rather than sell equity to black shareholders.
The minister gazetted a draft policy direction in May 2025, two days after President Cyril Ramaphosa led a delegation to the White House where Starlink’s unresolved South African licensing status was discussed with US President Donald Trump.
Read: Icasa caught in the political crossfire over Starlink
Malatsi was accused by critics – including ANC MP Khusela Diko, chair of parliament’s communications portfolio committee – of tailoring the reform to accommodate a single foreign-owned company. Industry support for the draft was nonetheless broad based, with the Internet Service Providers’ Association among those that endorsed it.
After seven months of consultation, Malatsi issued the final policy direction on 12 December 2025, instructing Icasa to “urgently consider alignment” of its ownership regulations with the ICT sector code, including full recognition of EEIPs.
The direction drew immediate political opposition from the ANC, EFF and MK Party, but was defended by the presidency in the days that followed. The telecoms industry broadly welcomed the move, although the Association of Comms & Technology cautioned on implementation.
Icasa’s silence over the four months that followed prompted increasing public frustration from Malatsi, who in April demanded that the regulator explain the “lack of sufficient detail” in its current position. Wednesday’s statement is the first formal public response from the regulator.
Read: ICT sector BEE code under the microscope as Starlink circles
The implications are significant. The Electronic Communications Amendment Bill, which Malatsi confirmed on Tuesday would be advanced to modernise the licensing framework, now becomes the critical instrument for any meaningful change to the ownership rules.
Responding late on Wednesday to Icasa, Malatsi said in a statement: “We remain committed to ensuring that South Africa’s licensing regime is fully aligned with the ICT sector code… We will pursue legislative amendments that will enable EEIPs to complement ownership requirements in telecoms, through amendments to the Electronic Communications Act.” – © 2026 NewsCentral Media
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