South Africa eases Black Economic Empowerment rules, opening door for Starlink
South Africa’s Communications and Digital Technologies Minister, Solly Malatsi, has gazetted a draft policy directive to relax Broad-Based Black Economic Empowerment (B-BBEE) licensing requirements for satellite service providers, potentially paving the way for Elon Musk’s Starlink to enter the local market.
The proposed amendment to the Electronic Communications Act aligns regulations with the Amended B-BBEE ICT Sector Code, allowing equity equivalent investment programs (EEIPs) as an alternative to the mandatory 30% ownership by historically disadvantaged groups.
This change aims to boost investment, enhance competition, and expand broadband access while upholding transformation goals through skills development and economic inclusion initiatives. Starlink, which has incorporated a local entity but not yet applied for a license, has been hesitant to comply with South Africa’s ownership rules due to its global policy against local shareholding.
The policy shift follows diplomatic engagements between President Cyril Ramaphosa and U.S President Donald Trump to strengthen South Africa-U.S. ties and address Musk’s concerns about B-BBEE compliance.
The Independent Communications Authority of South Africa (ICASA) has been directed to update regulations to support new entrants. Public comments on the draft are open until June 23, 2025.
If implemented, this could mark a significant step toward bridging South Africa’s digital divide.
There is still a long way to go. It has to get approval in parliament. The ICT sub-committee in parliament has to look at the gazette and summon the Minister for explanation. Starlink has not applied for a licence to the Independent Communications Authority of South Africa (ICASA) yet.