Domestic policy and South Africa's commitments under the WTO'S basic telecommunications agreement: Explaining the apparent inertia

Journal of International Economic Law

Volumn 4, Issue 4, 2001, Pages 725-754

  Cohen, Tracy ^a  

^a NONE

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EID: 0035734456     PISSN: 13693034     EISSN: None     Source Type: Journal    
DOI: 10.1093/jiel/4.4.725     Document Type: Article

References (175)

1. Fourth Protocol to the Basic Agreement on Trade in Services, 30 April 1996, WTO Doc S/L/20.
2. Including competition, attracting foreign investment or increasing network rollout.
3. The Telecommunications Act, 1996.
4. On the broader sovereignty debate, see generally John O. McGinnis, 'The Political Economy of Global Multilateralism', 1 Chi J Intl Law 2 (2000), at 381 and Kal Raustiala, 'Sovereignty and Multilateralism', 1 Chi J Intl Law 2 (2000), at 401.
5. On the broader sovereignty debate, see generally John O. McGinnis, 'The Political Economy of Global Multilateralism', 1 Chi J Intl Law 2 (2000), at 381 and Kal Raustiala, 'Sovereignty and Multilateralism', 1 Chi J Intl Law 2 (2000), at 401.
6. Services have historically been viewed as non-tradable for a number of reasons including their supposed intangibility or invisibility; their non-durable or transitory character and the view that they require direct and simultaneous production and consumption. See E. Senunas, 'The 1997 GATS Agreement on Basic Telecommunications: A Triumph for Multilateralism, or the Market', BC Intell Prop & Tech F 111, 401 (1997). For the arguments excepting to this characterization, see Michael J. Trebilcock and Robert Howse, The Regulation of International Trade (2d edn, London: Routledge 2000) at 271-73.
7. Services have historically been viewed as non-tradable for a number of reasons including their supposed intangibility or invisibility; their non-durable or transitory character and the view that they require direct and simultaneous production and consumption. See E. Senunas, 'The 1997 GATS Agreement on Basic Telecommunications: A Triumph for Multilateralism, or the Market', BC Intell Prop & Tech F 111, 401 (1997). For the arguments excepting to this characterization, see Michael J. Trebilcock and Robert Howse, The Regulation of International Trade (2d edn, London: Routledge 2000) at 271-73.
8. General Agreement on Trade in Services, contained as Annex 1 (b) to General Agreement on Tariffs and Trade - Multilateral Trade Negotiations (The Uruguay Round): Final Act Embodying the Results of the Uruguay Round of Trade Negotiations, 15 December 1994, 33 ILM 1167, 1195.
9. Annex on Telecommunications, April 1994, App. to GATS, at http://wto.org/services/12-tel.htm (last modified: 25 April 1997).
10. Reference Paper on Regulatory Principles used for consideration as additional commitments in offers on basic telecommunications, WTO Negotiating Group on Basic Telecommunications (24 April 1996). See http://www.wto.org/wto/press/refpap-e.htm. (last modified: 25 April 1997).
11. For an overview of the GATS and trade in services, see generally Trebilcock and Howse, above n 5, at 270ff and Michael H. Ryan, Trade in Telecommunications Services: A Guide to the GATS (London: Coudert Brothers 1997).
12. With GATS however, MFN applies horizontally while National Treatment is undertaken as a specific commitment.
13. The 'unconditionality' principle can be narrowed through exemption, Article II:2. See Arlan Gates, 'Technological Change, Industry Concentration and Competition Policy in the Telecommunications Sector', 58(2) Univ Toronto Faculty of L R (2000), at 98.
14. Article XVII:1.
15. Article XVI: 2 (a)-(f). General exceptions however, are listed in Article XIV. The specific commitments, including national treatment, apply only to the scheduled or listed sectors and thus only bind members to the extent that they undertake commitments.
16. GATS Article III:3 and the Annex, provision 4.
17. Article VI:1 and 4.
18. Janisch notes the value however of the proportionality rule in keeping disproportionate licensing requirements in check. See Hudson N. Janisch, 'International Influences on Communications Policy in Canada' in Orr and Wilson (eds), The Electronic Village, Policy Issues of the Information Economy (Toronto: CD Howe Institute 1998) at 76.
19. The South African Internet Exchange. This contention forms part of a four-year long High Court proceeding between Telkom and the SA Internet Service Provider's Association. See Telkom SA (Limited) v Maepa and Others (8 April 1998), Transvaal Provincial Division 25840/97 (High Court of South Africa). See below n 73. Similar concerns can be raised in terms of Vodacom's holding of Internet Service Provider, Worldonline (formerly Yebonet!).
20. Only 48 governments were prepared to schedule basic services. See Jennifer L. Feltham, 'Polish Communications Law: Telecommunications takes off in transition countries but at what price are they becoming wired?', 33 Vand J Transnat'l L 147 (2000), at 154. See also Marco C. E. J. Bronckers and Pierre Larouche, 'Telecommunications Services and the World Trade Organization', 31(3) J of World Trade (1997), at 6.
21. Only 48 governments were prepared to schedule basic services. See Jennifer L. Feltham, 'Polish Communications Law: Telecommunications takes off in transition countries but at what price are they becoming wired?', 33 Vand J Transnat'l L 147 (2000), at 154. See also Marco C. E. J. Bronckers and Pierre Larouche, 'Telecommunications Services and the World Trade Organization', 31(3) J of World Trade (1997), at 6.
22. Article II:2. authorizes measures inconsistent with MFN if it is listed in the Schedule and meets the conditions set out in the Annex on Article II Exemptions. As Senunas, above n 5, points out however, these conditions are not onerous and merely call for a review of all exemptions lasting more than 5 years and provide that in principle, no exemption shall exceed 10 years.
23. The Regulatory Reference Paper was later adopted by all participating countries except Ecuador and Tunisia. Bronckers and Larouche, above n 18, at 23.
24. Including the conditioning of market access on spectrum availability; whether the transport of video and/or broadcast signals was included in basic services; potential anti-competitive distortions of trade and whether the application of accounting rates to services amounted to 'measures' under GATS and were subject to MFN. The latter two, particularly, remain contentious and will likely play an important role in subsequent negotiations. For detailed examination of these concerns, see Bronkers and Larouche, ibid, at 13.
25. The agreement came into effect on 5 February 1998 and currently has 72 signatories.
26. Simply stated, this advantage arises from the existence of the former monopoly's established network, customer base and political access to policy-makers. These advantages may result in the refusal to provide facilities and interconnection to new entrants; unfair cross-subsidization and predatory behaviour. An independent regulator is intended to restrain this tendency.
27. For a detailed account of the process, see Robert Horwitz, Communication and Democratic Reform in South Africa (Cambridge University Press 2001).
28. The governing legislation was the Post Office Act 1958. See Myron Zlotnick, 'Telecommunications Monopoly in South Africa - Some Human Rights Aspects and Options for Future Regulation', 43 J African L 214 (1999), at 215.
29. Thintana Communications Inc comprised of Texas-based SBC Communications Inc (18 percent) and Telekom Malaysia (12 percent).
30. Including public switched, national long distance and international services, local access services and public pay phone services. In the five-year period Telkom is required to rollout 2.6 million lines in total, 1.6 of these in priority areas and 120,000 new public pay phones. The so-called 'Telkom License' contains three separate licenses. Government Gazette 17984 GN R768 (PSTS); GN R769 (VANS) and GN R770 (Radio) of 7 May 1997.
31. A draft Telecommunications Amendment Bill published on 29 August 2001 [B65-2001] confirms that Telkom will not apply for the extension, which was to be negotiated between itself and the Department of Communications. See Government Gazette 22630 online at http://www.parliament.gov.za/bills/2001/index.htm (visited 14 September 2001).
32. Section 2(a)-(q), Telecommunications Act, 1996.
33. Established by the Independent Broadcasting Authority Act, 1993. The Telecommunications Act does not apply to broadcasting in South Africa, except in so far as certain aspects of frequency management demand. For an overview of broadcasting in SA prior to the IBA Act, see Hudson N. Janisch and Danny M. Kotlowitz, 'African Renaissance, Market Romance: post apartheid privatization and liberalization in South African broadcasting and telecommunications' (CITI Symposium, Has Privatization Worked? The International Experience, Columbia University, 12 June 1998) (on file with the author).
34. ICASA Act, 2000. The Telecommunications Act and the Broadcasting Act, 1999 continue to operate as governing legislation for both sectors. When passed however, the Telecommunications Amendment Bill [B65-2001] will amend the principal Act.
35. Government Gazette 15232 GN R1078 of 29 October 1993.
36. There are two nationwide state PTNs: Transtel (a division of the transport utility, Transnet) and Esi-Tel (a division of the electricity utlity, Eskom) and a number of competitive interim PTN licenses have also been granted under the Act.
37. Licensed in terms of s 40 of the Telecommunications Act, 1996.
38. For an overview of the Internet industry in SA, see Media Africa.com, The 4th South African Internet Services Survey (Johannesburg: Media Africa.com, 2000) available at http://www.mediaafrica.com.
39. Telecommunications Act, 1996, s 45.
40. CommUnity, online at http://www.communitysa.org.za. (visited 20 September 2001).
41. WTO (15 April 1994) Schedule of Specific Commitments (South Africa) GATS/SC/78, (94-1075). SA's final offer was submitted on 13 February 1997 (S/GBT/W/1/Add9/Rev2 (97-0563)).
42. Additional commitments were undertaken in respect of paging, personal radio communication services and trunked radio system services.
43. The 20 March 2001 and 26 July 2001 Ministerial Policy Directions are available online at http:// docweb.pwv.gov.za (visited 13 September 2001).
44. Above n 28. The Bill also includes a number of measures necessary to facilitate the Telkom IPO. See n 47 and accompanying text.
45. Many of the proposed amendments have no direct bearing on the subject matter of this article, therefore detailed discussion of the Bill will not be included here.
46. Telecommunications Act, 1996, ss 36(1)(a), 36(7)(c) and 36(9)(a).
47. Section 36(1)(a) and 30(3)(a).
48. Above n 28.
49. The others are Eskom, Transnet, and the Airports Company. Telkom's assets exceed R27 billion, making it the country's third largest parastatal after Eskom and Transnet. The IPO is valued at between R80-100 billion (9.2-11.6 USD) and is expected to be one of the largest ever on the JSE. 'Telkom IPO among the biggest' News24.co.za, 23 October 2000 at http://www.News24.co.za.
50. A further 3 percent stake in Telkom, estimated to be worth more than R600 million was awarded to Ucingo Investments, a black economic empowerment group in March 2001. 'Ucingo Wraps Up Stake in Telkom', Business Report (3 April 2001).
51. Robyn Chalmers and Lesley Stones, 'Minister Loses Her Voice and Escapes Some Tricky Questions', Business Day (27 July 2001).
52. It is speculated that intensive lobbying by Telkom and M-Cell, the parent company of cellular operator MTN, a potential bidder for the SNO is responsible for the turnaround. Government holds a 24.5 percent stake in M-Cell, which lost R6 billion on its market capitalization following the second policy announcement in July 2001. See Lesley Stones, 'Industry Plea for State to Rethink Telecoms Policy', Business Day (31 July 2001) available at http://allafrica.com/stories/200107310141.html. Other possible reasons include the potential reduced investor interest that two fixed line competitors might have on the proposed IPO, affecting government's privatization revenue targets. See Robyn Chalmers, 'Telkom's Listing May Be in Jeopardy' Business Day (31 July 2001).
53. It is speculated that intensive lobbying by Telkom and M-Cell, the parent company of cellular operator MTN, a potential bidder for the SNO is responsible for the turnaround. Government holds a 24.5 percent stake in M-Cell, which lost R6 billion on its market capitalization following the second policy announcement in July 2001. See Lesley Stones, 'Industry Plea for State to Rethink Telecoms Policy', Business Day (31 July 2001) available at http://allafrica.com/stories/200107310141.html. Other possible reasons include the potential reduced investor interest that two fixed line competitors might have on the proposed IPO, affecting government's privatization revenue targets. See Robyn Chalmers, 'Telkom's Listing May Be in Jeopardy' Business Day (31 July 2001).
54. See Nathi Sukazi, 'Transtel, Esi-Tel pine for 50% of second network', Business Report (16 March 2001).
55. See also 'We Will Not Fight Eskom for SNO, Says Transtel', Africa News (17 August 2001).
56. Philip de Wet, 'Third National Operator, Broadband Abandoned', ITWeb (16 August 2001). In a recent joint Communications Portfolio and Labor Select Committee briefing, the Minister noted that flexibility was necessary to accommodate the industry's state of flux. Government did not want to specify a foreign ownership cap in law, which would then be difficult to change at a later date. The minutes of this meeting are available online at http://www.pmg.org.za/viewminute.asp?id=844 (visited 15 September 2001).
57. Philip de Wet, 'Third National Operator, Broadband Abandoned', ITWeb (16 August 2001). In a recent joint Communications Portfolio and Labor Select Committee briefing, the Minister noted that flexibility was necessary to accommodate the industry's state of flux. Government did not want to specify a foreign ownership cap in law, which would then be difficult to change at a later date. The minutes of this meeting are available online at http://www.pmg.org.za/viewminute.asp?id=844 (visited 15 September 2001).
58. Clause 2.6. Chapter II of the White Paper, Government Gazette 16995 GN 291 of 13 March 1996.
59. Section 32A(1).
60. Presumably, the government may argue that they have complied with resale obligations by introducing a SNO and other competitive licenses. Further, that the commitment does not specify whether resale services are voice or data, and that technically data resale is permitted, implicit in the provisioning of VANS services. This contention would be difficult to make, given that Telkom claims such resale is illegal under their exclusivity. Arguably, in the absence of a definition to limit resale to data, the term must be interpreted in its common industry usage, that is, the sale to end consumers, of bulk discounted voice minutes purchased by resellers from network operators. Finally, it is noteworthy that this commitment was scheduled as an additional one, making it a positive undertaking.
61. Telecommunications Act 1996, s 40(2).
62. It should however be noted that the July 2001 Policy Direction provides for a Ministerial Policy Review after two years, to determine the feasibility of extending VoIP to other operators in the telecoms industry. See clause 6.4.
63. Section 27(9) and s 34.
64. 'Decision of the Minister of Communications on the Third Mobile Cellular Telecommunications License', Press Release, issued by the Ministry for Communications, 16 February 2001, at http:// docweb.pwv.gov.za.
65. The feasibility study, an invitation to apply and consequent application hearings, with bids received from international and local consortia were held within the specified time frame. Substantive delay in the process began with the announcement of Cell-C as the preferred winner in July 2000, triggering a spate of court proceedings alleging government interference in the licensing process and alleging that SATRA failed to consider independent assessments of the bids. See Leslie Stones, 'Cellular License Brawl Continues', Business Day (11 September 2000) and Hilary Gush, 'South African Mobile License Saga Takes New Twist', Reuters (18 September 2000).
66. The feasibility study, an invitation to apply and consequent application hearings, with bids received from international and local consortia were held within the specified time frame. Substantive delay in the process began with the announcement of Cell-C as the preferred winner in July 2000, triggering a spate of court proceedings alleging government interference in the licensing process and alleging that SATRA failed to consider independent assessments of the bids. See Leslie Stones, 'Cellular License Brawl Continues', Business Day (11 September 2000) and Hilary Gush, 'South African Mobile License Saga Takes New Twist', Reuters (18 September 2000).
67. See Ivor Powell, 'Satra Split over Cell C', Mail and Guardian (31 March 2000) and Ellis Mnyandu 'Saudi-Backed Phone Group Defends South Africa Bid Win', Reuters (28 June 2000), available at http://www.kagan.com/archive/reuters/2000/06/28/2000062817mma.html. (visited 9 December 2000)
68. See Ivor Powell, 'Satra Split over Cell C', Mail and Guardian (31 March 2000) and Ellis Mnyandu 'Saudi-Backed Phone Group Defends South Africa Bid Win', Reuters (28 June 2000), available at http://www.kagan.com/archive/reuters/2000/06/28/2000062817mma.html. (visited 9 December 2000)
69. Other costs include excessive legal fees for applicants and ICASA; job creation; black economic empowerment; real price and service competition to existing operators and more than R4 billion in peak investment, of which half would have been foreign direct investment. Marina Bidoli, 'Debacle Puts the Frighteners into Telecoms Investors', Financial Mail (6 October 2000).
70. Section 34(2)(a)-(b) read with s 35(2).
71. Section 34(2)(a)(ii).
72. Specifically by Alan Darling, former Canadian Radio, Television and Telecommunications Commission (CRTC) Executive Director. See Marina Bidoli, 'We're Breaking Up', Financial Mail (23 April 1999).
73. See sections 34, 35 and 35A.
74. The most recent policy was published in December 2000, the implications of which are not discussed here given that the policy is still not yet finalized and is subject to possible amendment in light of the Telecommunications Amendment Bill. See Government Gazette GN R4609 of 8 December 2000.
75. Telkom License, provision 3.1(b).
76. Laura B. Sherman, '"Wildly Enthusiastic" About the First Multilateral Agreement on Trade in Telecommunications Services', 51 Fed Comm LJ 61 (1998).
77. A 'major supplier' is one defined as one that can materially affect the terms of participation (price and supply) in the relevant market for basic telecoms services as a result of its position or its control over 'essential facilities' (facilities of a public telecoms transport network or service that are exclusively or predominantly provided by a single or limited number of suppliers, and cannot feasibly be economically or technically substituted in order to provide a service).
78. For an excellent assessment of competition in telecommunications and international trade in light of convergence, see Arlan Gates, above n 11, at 83. See also Marcus Fredebeul-Krein and Andreas Freytag, 'The Case for a More Binding WTO Agreement on Regulatory Principles in Telecommunications Markets', 23 Telecommunications Policy (1999), at 628.
79. Not all cross-subsidization is anti-competitive, but it can easily become so in monopoly markets when the profits from exclusive services are used to undercut competitors prices in non-exclusive service sectors. See Bronckers and Larouche, above n 18, at 27.
80. The Fourth Protocol had not yet been signed and the market had not reached the same level of maturity with the presence of foreign providers as it has now.
81. In the initial complaint to the then Competitions Board who had jurisdiction prior to the formation of SATRA, the ISPA alleged that Telkom was providing SAIX with certain advantages that were anti-competitive. For example, the unfair cross-subsidization between voice and Internet services, fuelled by the fact that SAIX could offer dial-up services at a substantially lower rate than the private ISPs; free co-location for SAIX in Telkom exchanges and rapid responses to line applications for SAIX on behalf of clients, for which ISPA members were often subject to long delays. Finally, that SAIX was engaging in predatory pricing and piracy of ISPA's customer base as information about the prospective client, including contact details, had to be submitted to Telkom on application for a leased line. For a detailed account of the ISPA claims to the Competition Board, see http:// www.ispa.org.za/submission.html.
82. Above n 18.
83. Clause 8.1 of the Telkom PSTS license. This is to be established in accordance with the Chart of Accounts and the Cost Allocation Manual (COA/CAM).
84. In terms of clause 9.7 read with 3.1 of the Telkom PSTS License, tariffs need only be rebalanced at the end of the exclusivity period.
85. Fredebeul-Krein and Freytag, above n 70, and Sherman, above n 68. But for a defense of this principle, see Chantal Blouin, 'The WTO Agreement on Basic Telecommunications: a Reevaluation', 24 Telecommunications Policy 135 (2000), at 139-40.
86. Fredebeul-Krein and Freytag, ibid, at 628-29.
87. Clause 2.1. For a basic account of interconnection issues, see ITU, Trends in Telecommunication Reform, 2000-2001: Interconnection Regulation.
88. See also W. H. Melody, 'Interconnection: the Cornerstone of Competition', Telecom Reform: Principles, Policies and Regulatory Practices (Lyngby, Denmark: Den Private Ingeniorfond, Technical University of Denmark 1997).
89. Above n 70, at 629.
90. Fredebeul-Krein and Freytag, ibid, at 630. It is possible to counter the argument that the latter claim is indeed a weakness. It seems quite clear that 'recourse to' must surely imply an enforcement measure. A domestic interconnection policy that makes no provision for agreements to be imposed following procedures and arbitration would arguably be falling short of both international standards and the goal behind the inclusion of the principle in the RP.
91. Section 43(1)(b) and (c). 'Reasonableness' is determined with reference to 'technical feasibility' and 'increased public use of the telecommunication system, or more efficient use of telecommunication facilities'.
92. Government Gazette 17984 GN R771 of 1997.
93. Section 43(3).
94. Government Gazette 20993, GN R1259 of 2000, online at http://satra.gov.za/publications.htm.
95. It is of course arguable that the provisions of section 43 and 44 of the Telecommunications Act contain sufficient authority for the regulator to act in the case of failure to supply facilities and refusal to interconnect where the objective criteria are satisfied, and that the Guidelines do not constitute the only authority to do so, below n 94. Moreover, the public interest objective threaded through the Act coupled with a general enabling provision in section 5(1)(b) that authorizes the regulator to perform any acts necessary for the performance of its functions, should provide additional grounds on which to intervene. However, SATRA repeatedly refused to act on a range of facilities leasing disputes in the industry until such time as the guidelines were in place.
96. Government Gazette 21107 GN R1680 of 2000.
97. SATRA, Media Release, 6 June 2000 at http://satra.gov.za/press-page.cfm (visited 12 December 2000). See also 'Satra's Last Stand', World Reporter (6 June 2000).
98. SATRA, Media Release, 6 June 2000 at http://satra.gov.za/press-page.cfm (visited 12 December 2000). See also 'Satra's Last Stand', World Reporter (6 June 2000).
99. The Department of Communications criticized the regulator's behavior as 'the last kick of a dying horse'. See 'Ngcaba Slammed for Comments', ITWeb (9 June 2000) and Lesley Stones, 'Clash Looms As SATRA Takes on Minister', Business Day (8 June 2000).
100. The Department of Communications criticized the regulator's behavior as 'the last kick of a dying horse'. See 'Ngcaba Slammed for Comments', ITWeb (9 June 2000) and Lesley Stones, 'Clash Looms As SATRA Takes on Minister', Business Day (8 June 2000).
101. Telkom SA Ltd v The Independent Communications Authority of SA et al, Unreported, Case No 19014/ 2000, 19 March 2001.
102. While the potential dispute between the USA and SA over Telkom's refusal to supply facilities is largely a 'competitive safeguards' dispute, the lack of clarity over the facilities leasing guidelines makes it suitable for consideration in this context.
103. Section 40 deems any person who was providing a VAN service in terms of agreements with Telkom under section 78(2)(a) of the Post Office Act, immediately prior to the commencement of the Telecommunications Act, to be the holder of a license to provide that service. AT&T's predecessor, Trafex (Pty) Ltd, was trading under those conditions since 1985.
104. Jennigay Coetzer, 'VAN Service Providers Complain of Pressure', World Reporter (6 October 1999).
105. The relief sought was under s 44(7) of the Act which provides in relevant part that, 'where the Authority is satisfied that Telkom is unwilling or unable to make suitable facilities available to that person within a reasonable period of time, the Authority may, instead of proposing terms and conditions . . . authorize that person to provide or obtain any necessary telecommunication facilities other than from Telkom on conditions determined by the Authority.' See above discussion n 86.
106. AT&T Global Network Services SA (Pty) Ltd et al, v Telkom SA Ltd, Unreported Case No 27624/99, 28 October 1999.
107. Lesley Stones, 'Court Sends Telkom Dispute to SATRA', Business Day (4 November 1999). Telkom claimed that facilities sharing between VANS and their clients cost Telkom between R500 million and R1 billion annually, because VANS providers are offering services to their clients that should have come from Telkom.
108. See below n 120.
109. Under s 1377 of the Omnibus Trade and Competitiveness Act, 1988, SA was one of nine countries under review in 2000. See Office of the United States Trade Representative, Washington, DC, Annual Review of Telecommunications Trade Agreements Highlights Concerns Regarding Mexico, South Africa, and Other Countries, 4 April 2000. The 1377 Reports for 2000-2001 are available at http:// www.ustr.gov/sectors/industry/telecom.shtml.
110. Article XVI and XVII respectively and Article VIII:1.
111. Article VIII:2
112. Provision 5(a), above n 7.
113. SATRA Judgment in the matter heard on the 6 and 7 June 2000 between the SAVA and Telkom SA Ltd. Available on SATRA's website at http://satra.gov.za.
114. Ibid, para 30.
115. 'USTR Decides to Keep Monitoring Germany, South Africa, UK', Washington Telecom Newswire (16 June 2000).
116. 2001 Section 1377 Review of Telecommunications Trade Agreements, 2 April 2001.
117. Reference Paper, para 3, See also above n 70, at 631.
118. Above n 98.
119. See Decision CRTC 2000-745, Ottawa, 30 November 2000, Changes to the Contribution Regime, Reference: 8695-C12-06/99 at http://www.crtc.gc.ca/archive/Decisions/2000/DT2000-745e.htm. One cannot be sure that the CRTC was responding to WTO concerns in this process. For an overview of the implications of the GATS Fourth Protocol on Communication Policy in Canada, see Janisch, above n 16, at 65-86.
120. While the objectives of the Act are not placed in a hierarchy, redressing apartheid exclusions is the de facto overarching one. Telkom's exclusivity is predicated on the assumption that the state is best placed to deliver services to unserved areas, that would not otherwise be serviced by competitors in a free market, who would 'cherry-pick' only the profitable aspects of that market. Most conflict in the industry stems from Telkom's obligations in this regard: Telkom claims it is merely defending its roll-out plan, and government's important national policy, and competitors suggest that Telkom uses this claim as disguised protectionism.
121. Clause 1.1. The current national teledensity figure per household is approximated at 42 percent overall, defined as the percentage of people who have a phone, cellular or fixed, in the dwelling where they live. The overall national universal access indicator, denned as the percentage of people who have access to a telephone, stands at 80. See above n 37.
122. Sections 65-67. The USF will be used for the payment of subsidies to assist needy persons towards the costs of telecommunications services. See Government Gazette 18617, GN 92 of 1998.
123. See Government Gazette 18277 GN R1332 of 1997. While ICASA is currently in the process of finalizing this with respect to VANS providers, the new Ministerial Policy Directions have proposed that all telecommunications licensees, including VANS, shall contribute a percentage of turnover prescribed by regulation, but shall not exceed 0.5 percent. The current ICASA proposals for VANS requires 0.25 percent. See Government Gazette 21642, 11 October 2000.
124. See Fredebeul-Krein and Freytag, above n 70, at 631.
125. Section 32(1). Section 33 specifies the categories of licenses and the services authorized by such licenses.
126. Section 40(2). This list is augmented by the ICASA, VANS, and PTN licensing framework, below n 120, and draft Telecommunications Bill [B65-2001].
127. Clause 1.5, Government Gazette 17984 GN 769 of 7 May 1997.
128. Section 34(1).
129. Section 34(3)(b).
130. Section 35(6)(a). As with the RP, written reasons to be furnished only on request.
131. Government Gazette 8462 of 1997 and Government Gazette 20866 of 4 February 2000.
132. Interim Guidelines for application for a license to provide value added network services, 6 November 1997 online at http://www.icasa.org.za/satra/default.htm (visited 28 September 2001).
133. Above n 120.
134. Above n 18, at 31. They note that the EU proposal on licensing, Common Position 7/97 has only mandated the simultaneous and co-ordinated issues of licenses in the Union.
135. Bronckers and Larouche, at 31.
136. Melody, above n 79, at 25.
137. Telecommunications Act 1996, s 5(3).
138. The Independent Broadcasting Authority Act, 1993.
139. Section 3(3) states, that 'The Authority shall function without any political or other bias or interference and shall be wholly independent and separate from the State, the government and its administration or any political party.'
140. The Constitution of the Republic of South Africa, 1996. Section 192 forms part of Chapter 9, which confers rights on state institutions supporting constitutional democracy, including, for example, the Public Protector and the Human Rights Commission.
141. ICASA Act, 2000.
142. Independent Communications Authority of South Africa Bill, 2000 [B 14B-2000]. Parliament tried, unsuccessfully, to give the powers of appointment and removal of councillors from office to the executive.
143. Although some assert that SATRA was considered 'too' independent for government, while others defended the merger as necessary to counter allegations of impropriety and to renew leadership and confidence in the sector. See 'All Eyes on the Appointment of Independent Regulators' World Reporter (11 May 2000).
144. ICASA Act, 2000, s 2(a).
145. Section 3(4). Section 3(3) suggests that ICASA be only subject to the Constitution and the law.
146. ICASA is required to operate off the combined budget allocations received by the IBA and SATRA as separate entities.
147. Alan Darling, above n 64. See also Marina Bidoli, 'We're Breaking Up', Financial Mail (23 April 1999).
148. Arguably as a direct result of the third cellular licensing debacle, the Schedule to the Telecommunications Amendment Bill contains a revised and expanded list of grounds upon which a councillor may be disqualified or removed from office.
149. Rohan Samarajiva, 'Establishing the Legitimacy of New Regulatory Agencies', 24 Telecommunications Policy (2000), at 183.
150. It is worth noting that for the court review of the third cell process, ICASA had to approach Parliament to increase its budget in order to pay legal fees to defend its actions.
151. Above n 5, at 422.
152. Telecommunications Act, s 28. Section 30 requires licensing for specified radio transmission and reception services.
153. The second South African Band Re-planning Exercise (SABRE 2), Government Gazette 21833, GN 4568 of 7 December 2000. SABRE 1 was completed in 1997.
154. Government Gazette 20354 GN 1771 of 1999 and Government Gazette 19786 GN R198 of 1999.
155. ICASA regulations dealing with number portability, carrier pre-selection and facilities leasing were drafted for public comment in July 2001. See Government Gazette 22533 GN 1781 of 2001. ICASA however withdrew its public inquiry following the joint policy statement issued on 15 August 2001 regarding further changes to the proposed telecommunications policy. See Government Gazette 22588 GN 1890 of 2001.
156. Specifically reference is made to Bronckers and Larouche; Fredebeul-Krein and Freytag, and in defense of the RP, Blouin, above n 77.
157. Ibid. See also Gates, above n 11, at 99, and Senunas, above n 5, and Sherman, above n 68, at 77. But see above n 81.
158. E. Noam and W. Drake, 'Assessing the WTO Agreement on Basic Telecommunications' in G. Hufbauer and E. Wada (eds), Unfinished Business: Telecommunications after the Uruguay Round (Washington, DC: Institute for International Economics 1997) cited in Chantal Blouin, above n 77, at 138.
159. Rohan Samarajiva. Above n 138, at 183. See also W. H. Melody, above n 79.
160. Janisch, at 72.
161. Blouin, at 139.
162. Ibid, at 140.
163. See above, n 5.
164. GATS, Article IV.
165. Section 5(g) [emphasis added].
166. Adopted by a Special Session of the Council for Trade in Services on 28 March 2001. See WTO Press Release, 217, 2 April 2001.
167. Above n 29.
168. In SA, telecommunications, broadcasting, and information technology combined comprise a R58 billion industry and contribute increasingly to GDP, which in 1998 was R730 billion. Of this the telecommunications industry accounts for 39 percent. Figures derived from BMI-Techknowledge 1999 and 2000 South African Reserve bank and cited by Alison Gillwald, 'Building Castells in the Ether' [forthcoming in 2001].
169. See Alison Gillwald, 'Telecommunication Policy and Regulation for Women and Development', Development Summit, TELCOM 99 + INTERACTIVE 99, Geneva, 10-17 October 1999.
170. While the monopoly, cross-subsidization model has been viewed as a way to finance universal service, it is not the only way to achieve this goal. In the SA context however, this has been both the approach and the justification for alleged and perceived anti-competitive behavior by Telkom since 1996.
171. While these are relaxed in current policy, the minimum set aside of 30 percent for black economic empowerment in all major licenses, as well as an equity reservation for either Esi-Tel or Transtel in the SNO, imposes a de facto foreign ownership restriction.
172. Initiatives such as the ITU's newly established Regulator's Forum for existing regulators and policy-makers interested in establishing a regulatory body, might assist in this regard, facilitating dialogue for regulators to share experiences and views. See http://www.itu.int/treg. (visited 25 September 2001).
173. Including Botswana, Lesotho, Namibia, and Swaziland. WTO, Press/TPRB/74. The Chairperson's conclusions are available at http://www.wto.org/english/tratop_e/tpr_e/tpr_e/tp74_e.htm. (visited 1 December 2000).
174. For a review of the negotiations guidelines and Member proposals regarding the structure and contents of the 2001 service negotiation rounds, see http://www.wto.org/english/tratop_e/serv_e/s propnewnegs_e.htm.
175. WTO Secretariat, Trade in Services Division, 'An Introduction to the GATS', October 1999, available at http://www.wto.org/english/tratop_e/serv_e/gsintr_e.doc (visited 15 September 2001).