A tale of two Bills

By Paul Vecchiatto, ITWeb Cape Town correspondent

Cape Town, 02 Nov 2005

Last week, the Parliamentary Portfolio Committee on Communications approved two bits of legislation that are set to have profound effects on the South African ICT sector.

Whether or not they will bring down prices and bolster overall confidence in the sector is far from certain.

The Electronic Communications Act (formerly the Convergence Bill), has been in the making for almost three years. The end result is a piece of legislation that some consider flawed, but is basically workable and sets the country on course for greater liberalisation of the telecommunications sector.

On the other hand, the Independent Communications Authority of SA (ICASA) amendment Bill seriously reins in the administrative independence of the regulator and this impacts directly on investment and consumer confidence in the sector.

Both are due to be deliberated before the main house of Parliament this week. After that, they will go before the National Council of Provinces (a body that acts as the upper house of Parliament) and then to President Thabo Mbeki for his signature, before being gazetted into law.

Tortured process

The ICASA amendment Bill seriously reins in the administrative independence of the regulator and this impacts directly on investment and consumer confidence in the sector.
Paul Vecchiatto, Cape Town correspondent

Bringing the Electronic Communications Act to Parliament has been a long process. Because of the 2003 convergence colloquium, former Department of Communications director-general Andile Ngcaba felt it would be unnecessary to publish the usual green and white discussion papers that usually precede draft legislation. Therefore there is no overall departmental policy document either.

In its four months of public hearings and deliberations into the Convergence Bill, the portfolio committee heard about 27 presentations from government, industry and civil society.

The committee placed great reliance on the Department of Communications` input. Often this resulted in the department having the last say, giving the impression that the committee was going through the motions. This led to concerns over the executive branch having too much input in the legislative process.

To be fair, the members of Parliament did engage each other, government and industry throughout the process. Overall, the committee chairperson, Mpetjane Lekgoro, was considered to have been even-handed.

Good, grey legislation

The Electronic Communications Act is good in that it lays the groundwork for eventual liberalisation, and the eventual reduction of telecommunications prices. However, it has many grey areas.

The final draft introduces a simple and logical licensing regime, mandates interconnectivity, allows local authorities to start developing their own telecommunications infrastructure, and it has at least the stated objective of bringing down consumer costs.

The devil, however, is in the detail. The interconnection issue, for instance, is far from being clear despite the legislation saying it can only be refused on technical grounds. Disproving that can be a monumental matter on its own as one party can easily play for time by performing "tests, evaluations and impact studies", until the business opportunity has passed.

"One thing about the Department of Communications is that it creates employment for lawyers," was a quip heard.

"Grey areas are good," said communications director-general Lyndall Shope-Mafole, "because they force companies to innovate."

I can`t help feeling that she has mixed up "innovate" with "litigate".

Administrative dependence

The ICASA amendment Bill is supposed to determine the rules for the referee.

Originally this Bill was going to detail how the authority would be funded. Ultimately, the issue was all but ignored while many other serious subjects were included, such as a new procedure to appoint councillors, the fact that ICASA must get ministerial approval to hire foreign experts, and the creation of a performance management system.

Essentially, this strips away ICASA`s administrative independence. This is seen as a serious issue because the regulator, as an independent body, should be answerable only to Parliament, in much the same way as the Independent Electoral Commission is.

"ICASA now stands for 'Ivy`s Communications Authority of SA`," quipped one industry observer after the Bill was approved. As far as industry is concerned, the joke cuts too close to the bone, because all players, including Telkom, want to see a strong and independent regulator that can operate without fear or favour.

This Bill forces ICASA to look seriously at its internal workings. It will have to tighten up its own procedures and policies - areas that have been sorely deficient.

The ICASA councillors have a right to be upset. They were not allowed to engage directly with the Department of Finance over their funding and had to depend on the Department of Communications to do so. This may explain why this issue is still unresolved.

Slow pace

How history will judge these two Bills will be based on two questions - did they help propel SA into the global ICT economy and did they bring any real benefits to consumers?

Right now it seems that with every one step forward there is half a step sideways. However, there is some hope that at least we are heading in the right direction, even if it is very slowly.

A tale of two Bills

Two new bits of communications legislation are to be debated in Parliament this week. Paul Vecchiatto examines their significance.

Tortured process

Good, grey legislation

Administrative dependence

Slow pace