ICASA Approves Dark Fibre Africa’s Applications to Transfer the Ownership of its I-ECS and I-ECNS Licences

The Independent Communications Authority of South Africa has approved a series of applications by Dark Fibre Africa to transfer the ownership and control of their I-ECS and I-ECNS licences. The effective date for the transfer of the licences is 01 December 2022.

These comprise of:

• the transfer of ownership of the Service Licences (i.e., I-ECS and I-ECNS licences) of Dark Fibre Africa (“DFA”) to NEWCO (“the Transferee”); and

• the transfer of control of DFA’s Service Licences (i.e., I-ECS and I-ECNS licences) to Vodacom.

The approval is, however, subject to the imposition of special licence conditions relating to the provision of open-access network services, along with limitations on ownership and control.

This approval follows ICASA’s receipt of the applications set out below on 6 April 2022, which were published for public comment on 20 May 2022:

1. Application in terms of section 13 of the Electronic Communications Act, 36 of 2005 (“ECA”), read with Regulation 11 of the Licensing Processes and Procedures Regulations, for the transfer of ownership of the Individual Electronic Communications Service (“I-ECS”) and Individual Electronic Communications Network Service (“I-ECNS”) licences (collectively, the “Service Licences”) held by DFA to Business Venture Investments No 2213 (Pty) Ltd (“NEWCO” or “the Transferee”);

2. Application in terms of section 13 of the ECA, read with Regulation 11 of the Licensing Processes and Procedures Regulations, for the transfer of control of the Service Licences of DFA to Vodacom, pursuant to the acquisition of – a minority control interest in NEWCO by Vodacom.

3. Application in terms of Regulation 13 of the Radio Frequency Spectrum Regulations for the surrender of the Radio Frequency Spectrum (“RFS”) licence held by DFA (“RFS Surrender Application”); and

4. The application in terms of section 12 of the ECA read with Regulation 13 of the Licensing Regulations for the surrender of South African Digital Villages (Pty) Ltd.’s (“SADV”) Service Licences (“SADV Surrender Application”).

Written representations were received from the Internet Service Providers Association (“ISPA”), only. Following the receipt of these written representations and written responses on 9 June 2022 and 21 June 2022, respectively, a public hearing was held on 12 July 2022.

In line with its legislative and regulatory processes, the Authority has considered and analysed the applications and the key considerations emanating from them. The Authority’s analysis and evaluation took into account the following, inter alia:

• equity ownership by historically-disadvantaged persons (HDPs);

• competition in the ICT sector; and

• the interests of consumers.

The Authority has approved the proposed transaction after careful consideration. We view the transaction as unlikely to negatively impact the market while making the Transferee an effective player in the market. Additionally, the Authority views the proposed transaction to be in the best interest of the public.

Councillor Luthando Mkumatela, Chairperson of the responsible Council Committee

The Authority will publish the Reasons for the Decision in respect of the transfer applications, together with the specific conditions imposed on the Transferee, in due course.