Communications minister Ivy Matsepe-Casaburri yesterday ordered that the selection of the various portions to make up the second national operator (SNO) - the planned competitor to Telkom - be conducted in phases.
The announcement may appear incongruous, considering that black empowerment consortia have already submitted separate bids to form part of the SNO, but it is a victory for the Independent Communications Authority of SA (ICASA) in a battle of wills with the government.
ICASA has to date refused to evaluate the empowerment bids submitted in mid-April, saying it did not have the legal authority to do so. It argued that, under the legislation which governs it, it is required to choose a single bidder which combines a foreign operator and an empowerment component, to recommend as the preferred SNO licensee.
Such was the process when third mobile operator Cell C was licensed last year; hopeful operators first wooed empowerment partners and then submitted a single bid.
Government, however, had decided that in the case of the SNO, the empowerment portion would be adjudicated first, and that potential foreign operators would enter an arranged marriage with it and parastatals Eskom Enterprises and Transtel to form the final SNO.
Eskom Enterprises is to make up 30% of the consortium, 19% has been set aside for an empowerment group and the remaining 51% is to be taken up by an established telecommunications operator.
ICASA says this is now legally possible with the notice published by the minister. Although not declaring it a victory, the regulator says it is pleased that the final piece of the legal puzzle is now in place.
"It has always been the view of the authority that in order to conduct a successful licensing project, one needs to have in place mechanisms, procedures and systems that are litigation-proof so as to eliminate or minimise the possibilities of delaying the licensing process through court challenges," says chairman Mandla Langa.
ICASA and its predecessor SATRA (the SA Telecommunications Regulatory Authority) saw the issue of the Cell C licence delayed by more than two years due to legal challenges.
The authority says it will move swiftly to start the evaluation of the empowerment bids. The bid documents will be opened to the public early next week. Written public submissions on the bids will be accepted up to 30 May, and the applicants will have to respond to such submissions by mid-June. Public hearings on the bids are expected to be wrapped up by the end of June. The minister is expected to announce a winner during early August.
Despite the month-long delay in starting the adjudication, ICASA is positive that the SNO could be licensed soon.
"We are definitely looking at before the end of the year," says Langa.
However, the invitation to apply (ITA), which would trigger bids from operators for the 51% stake, has yet to be issued. The Department of Communications recently said the ITA would be issued before end-April, then moved the deadline to the first week in May, and most recently rumour had it that it would be issued this week. At the time of publication, it had not been issued, although the document is said to be ready.
Department of Communications officials could not be reached for comment.
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