REPUBLIC OF SOUTH AFRICA

(MINISTER OF COMMUNICATIONS)

ISBN 0 621 31398 X

No. of copies printed .................................... 1 800.

GENERAL EXPLANATORY NOTE:

[]Words in bold type in square brackets indicate omissions from

existing enactments.

Words underlined with a solid line indicate insertions in

existing enactments.

BE IT ENACTED by the Parliament of the Republic of South Africa, as

follows:—

1. Section 1 of the Telecommunications Act, 1996 (hereinafter referred to as ‘‘the

principal Act’’), is hereby amended—

(a) by the insertion after the definition of ‘‘broadcasting signal distribution’’ of the

following definitions:

‘‘ ‘carrier of carriers’ means a telecommunication service (including any

signal conveyed by means of the telecommunication system of that

service) which—

(a) originates on the telecommunication system of a public switched

telecommunication service licensee or mobile cellular telecommu-nication

service licensee or an under-serviced area licensee in the

Republic and terminates in a telecommunication system in another

country or vice versa;or

(b) originates and terminates in a telecommunication system of an

operator licensed in another country to provide international

services, but is conveyed via a telecommunication system in the

Republic on a wholesale basis,

but which specifically excludes the termination of international telecom-munication

services to end-users directly in the Republic;

‘carrier pre-selection’ means any facility by which subscribers to a

telecommunication service can access the services of an interconnected

national long-distance telecommunication operator and international

telecommunication operator;’’ ;

(b) by the insertion after the definition ‘Director-General’ of the following

definitions:

‘‘ ‘ directories’ means a list (which may be made available in separate

parts and through different media) of customers of a designated licensee

or multiple licensees and their telephone numbers which are generally

arranged in alphabetical order and not by reference to a description of the

trades, professions or businesses carried on by those customers;

‘directory enquiry service’ means the provision of information contained

in directories;

(c) by the substitution for the definition of ‘‘ Eskom’’ of the following definition:

‘‘ Eskom’’ means Eskom referred to in section 2(1) of the Eskom Act,

1987 (Act No. 40 of 1987), and includes its subsidiaries.’’ .

(d) by the substitution for the definition of ‘‘ fixed line operator’’ of the following

definition:

‘‘ ‘ fixed-line operator’ means [Telkom and] a holder of a licence to

provide a public switched telecommunication service or any other person

who provides a licensed telecommunication service by means of a

telecommunication system consisting mainly of fixed lines, and ‘opera-tor’

shall be construed accordingly;’’ ;

(e) by the insertion after the definition of ‘‘ fixed-line operator’’ of the following

definition:

‘‘ ‘ fixed-mobile service’ means a service provided by the holder of a

public switched telecommunication service licence or an under-serviced

area licence that permits a customer of the licensee to access the public

switched telecommunication network of the licensee and obtain telecom-munication

services from such licensee from either a fixed point or whilst

in motion within the local exchange area, but shall not permit call

handover.’’ ;

(f) by the substitution for the definition of ‘‘ interconnect’’ of the following

definition:

‘‘ ‘ interconnect’ means [to link two] the physical or logical linking of

telecommunications systems [so that users of either] in order to enable

any user of a system [may] so linked to communicate with [users] any

user of, or utilise services provided by means of, [the] another system [or

any other telecommunication system] so linked, and ‘interconnection’

has a corresponding meaning;’’ ;

(g) by the insertion after the definition of ‘‘ interconnect’’ of the following

definitions:

‘‘ ‘ international telecommunication service’ means a telecommunication

service (including any signal conveyed by means of the telecommunica-tion

system of such service) which—

(a) originates in a telecommunication system in the Republic and

terminates in a telecommunication system in another country or

vice versa;or

(b) originates and terminates in a telecommunication system in another

country but is conveyed via a telecommunication system in the

Republic;’’ ;

‘local access telecommunication service’ means a telecommunication

service provided within a defined geographic area, comprising the

conveyance of signals—

(a) between any customers of the licensee within that area; and

(b) to and from a customer of the licensee and the network of any public

service telecommunication licensee with whom the licensee is

interconnected at a point in that area,

and include the installation, bringing into service, the maintenance and

repair of the telecommunication network which is provided, maintained

and operated by the licensee for the purposes of providing the local

access telecommunication service as contemplated in section 39;

‘local exchange’ means a facility in the public switched telecommunica-tion

network to which user lines are connected within a local exchange;

‘local exchange area’ means a geographically defined and limited area, as

defined by the exchange area code allocated by the Authority for that

area, to which all exchange lines are connected and which are served by

the same local exchange;’’ ;

(h) by the substitution for the definition of ‘‘ Minister’’ of the following definition:

‘‘ ‘ Minister’ means the Minister [for Posts, Telecommunications and

Broadcasting] of Communications;’’ ;

(i) by the insertion after the definition of ‘‘ Minister’’ of the following definitions:

‘‘ ‘ mobile cellular telecommunication network’ means a telecommuni-cation

network designed to use limited radio frequency spectrum

between cellular terminal equipment and network transceivers to provide

a mobile service across a cellular network according to technical

standards that are applicable to the assigned frequencies by—

(a) allocating a limited number of frequencies within each of a number

of defined geographical areas or cells;

(b) allowing the re-use of the same frequencies in different non-adjacent

cells; and

(c) enabling users to maintain connections while moving through

different geographical areas by making use of call handover

between adjacent cells;

‘mobile cellular telecommunication service’ means a telecommunication

service provided by a licensed mobile cellular telecommunication

operator as referred to in section 37;

‘mobile cellular operators’ means Vodacom (Pty.) Ltd., Mobile Tele-phone

Networks (Pty.) Ltd. and Cell C (Pty.) Ltd.;

‘multimedia service’ means a telecommunication service that integrates

and synchronises various forms of media to communicate information or

content in an interactive format, including services such as—

(a) internet through television;

(b) pay-per-view;

(c) video on demand;

(d) electronic transactions (including e-commerce);

(e) text;

(f) data;

(g) graphics;

(h) animation;

(i) audio;

(j) visual content,

but shall not include mobile cellular telecommunication services and

public switched telecommunication services;

‘national long distance telecommunication service’ means a telecommu-nication

service comprising the conveyance of signals between the

network of any licensee providing local access telecommunication

services in an area, and the network of the same or of another licensee

providing such service in another area, and includes the installation,

bringing into service, maintenance and repair of the telecommunication

network that is provided, maintained and operated by the licensee for the

purposes of providing the national long distance telecommunication

service as contemplated in section 38;

‘number portability’ means a capability whereby a subscriber to a

telecommunication service who so requests can retain his or her

telephone number when changing service from one public switched

telecommunication service licensee to another public switched telecom-munication

service licensee or one mobile cellular telecommunication

service licensee to another mobile cellular telecommunication service

licensee;’’ ;

(j) by the insertion after the definition of ‘‘ prescribed’’ of the following

definitions:

‘‘ ‘ private telecommunication network’ means a telecommunication

system provided by a person for purposes principally or integrally related

to the operations of that person and which is installed onto two or more

separate, non-contiguous premises and where the switching systems

(nodes) of at least two of these premises are interconnected to the public

switched telecommunication network as contemplated in section 41;

‘public switched telecommunication networks’ means the telecommuni-cation

systems installed or otherwise provided, maintained and operated

by a public switched telecommunication licensee for the purpose of

providing public switched telecommunication services;

‘public switched telecommunication services’ means the provision of

telecommunication services to an end-user on a subscription basis or for

a fee referred to in section 36;

‘public switched telecommunication service licence’ means a licence

referred to in section 34(2)(a)(i);’’ ;

(k) by the insertion after the definition of ‘‘ radio apparatus’’ of the following

definition:

‘‘ ‘ radio frequency spectrum licence’ means a licence referred to in

section 30;’’ ;

(l) by the insertion after the definition of ‘‘ regulation’’ of the following

definitions:

‘‘ ‘ resale’ means the provision of any public switched telecommunica-tion

service by means of telecommunication facilities which are obtained

by the public switched telecommunication service licensee or under-serviced

area licensee in order to sell such services to its customer, and

‘‘ reseller’’ shall be construed accordingly;

‘second national operator’ means the second holder of a public switched

telecommunication service licence;

‘Sentech’ means Sentech (Pty) Ltd, a company established pursuant to

the Sentech Act, 1996 (Act No. 63 of 1996);’’ ;

(m) by the insertion after the definition of ‘‘ signal’’ of the following definition:

‘‘ ‘ small business’ (commonly referred to as an ‘SMME’) means a ‘small

business’ as defined in section 1 of the National Small Business Act,

1996 (Act No. 102 of 1996);’’ ;

(n) by the insertion after the definition of ‘‘ telecommunication system’’ of the

following definition:

‘‘ teledensity’’ means the number of telephone lines per 100 persons;

(o) by the insertion after the definition of ‘‘ Telkom’’ of the following definition:

‘‘ ‘ third generation telecommunication frequency licence’ means the

radio frequency spectrum licence referred to in section 30B;’’ ; and

(p) by the insertion after the definition of ‘‘ Universal Service Fund’’ of the

following definitions:

‘‘ ‘ value-added network service’ means a telecommunication service

provided by a person over a telecommunication facility, which facility

has been obtained by that person in accordance with the provisions of

section 40(2) of the Act, to one or more customers of that person

concurrently, during which value is added for the benefit of the

customers, which may consist of—

(a) any kind of technological intervention that would act on the content,

format or protocol or similar aspects of the signals transmitted or

received by the customer in order to provide those customers with

additional, different or restructured information;

(b) the provision of authorised access to, and interaction with,

processes for storing and retrieval of text and data;

(c) managed data network services;

‘voice over internet protocol’ means a series of techniques permitting

transmission of a voice over the internet or through one or more

telecommunication facilities using internet protocol.’’ .

2. Section 2 of the principal Act is hereby amended by the addition of the following

paragraphs:

‘‘ (r) promote and facilitate convergence of telecommunication, broadcasting and

information technology;

(s) develop the Information, Communication and Technology (ICT) strategy for

the Republic, in order to bridge the digital divide.’’ .

3. The following section is hereby substituted for section 3 of the principal Act:

‘‘ 3. This Act shall not apply in relation to broadcasting, broadcasting signal

distribution or broadcasting services frequency bands, except as provided in

sections [28(3)] 2(r) and 127 to 129 and in relation to multimedia services (if

applicable).’’ .

4. Section 29 of the principal Act is hereby amended by the substitution for

subsections (5) and (6) of the following subsections, respectively:

‘‘ (5) The Authority [shall] may, after the period referred to in subsection (4) has

passed, hold a hearing in respect of the proposed plan.

(6) After the hearing, if any, and after due consideration of any written

representations received pursuant to the notice mentioned in subsection (4) or

tendered at the hearing, the Authority shall adopt the frequency band plan in

question, with or without amendment, and cause such plan to be published in the

Gazette.’’ .

5. The following sections are hereby inserted in the principal Act after section 30:

30A. (1) (a) Within six months after the date of commencement of this

paragraph or such longer period as the Minister may determine, the mobile

cellular operators may apply to the Authority for access to the radio

frequency spectrum in the 1800 MHz frequency band to provide mobile

cellular telecommunication services and such other services as the mobile

cellular operators are, from time-to-time, licensed to provide.

(b) Within 30 days of receipt of the application contemplated in

paragraph (a) the Authority shall assign to each mobile cellular operator a

radio frequency spectrum—

(i) against the payment of such fees, to be payable over a period, as the

Minister shall determine by notice in the Gazette; and

(ii) subject to such conditions as the Authority may prescribe.

(c) For purposes of paragraph (b)(i), the Minister may specify by notice

in the Gazette a multiple payment schedule pursuant to which the mobile

cellular operators shall make payment, and the terms and conditions of such

payment.

(d) Prior to the date a radio frequency spectrum is assigned to a mobile

cellular operator as contemplated in paragraph (b), the holder of a licence

which exists at the commencement of the Telecommunications Amendment

Act, 2001, shall, in accordance with radio regulations governing migration

and clearing of radio spectrum bands, clear the spectrum to be occupied by

such mobile cellular operator.

(2) (a) The second national operator and Telkom shall each be deemed to

be a holder of a radio frequency spectrum licence in the 1800 MHz

frequency band to provide public switched telecommunication services,

and such other services as the second national operator, from time-to-time,

is licensed to provide.

(b) Within six months after the date the second national operator is

granted a public switched telecommunication service licence, or such

longer period as the Minister may determine, Telkom may apply to the

Authority for a radio frequency spectrum licence in the 1800 MHz

frequency band to provide public switched telecommunication services,

and such other services as Telkom, from time-to-time, is licensed to

provide.

(c) The Authority shall issue to the second national operator and Telkom

a radio frequency spectrum licence contemplated in paragraph (a) or (b),as

the case may be—

(i) against the payment of such fees, to be payable over a period, as the

Minister shall determine by notice in the Gazette; and

(ii) subject to such conditions as the Authority may specify in that licence.

(d) For purposes of paragraph (c)(i), the Minister may specify by notice

in the Gazette a multiple payment schedule pursuant to which the second

national operator and Telkom, respectively, shall make payment, and the

terms and conditions of such payment.

(3) (a) Holders of a radio frequency spectrum licence in the 1800 MHz

frequency band shall co-ordinate, in good faith, their respective frequency

usage with other such licensees to—

(i) avoid harmful interference among licensees;

(ii) ensure efficient use of the 1800 MHz frequency band; and

(iii) allow for the provision of cost-efficient services.

(b) The Authority may prescribe regulations governing the co-ordination

contemplated in paragraph (a), which may include a process for the speedy

resolution of disputes among licensees.

(4) In determining the fees contemplated in subsections (1)(b)(i) and

(2)(c)(i) the Minister shall take into account—

(i) MHz pair per population per licence year;

(ii) provision of paired or unpaired spectrum;

(iii) technical and administrative cost of spectrum management, including

projected costs for Authority involvement in frequency co-ordination

contemplated in subsection (3); and

(iv) any other matter that is consistent with section 2.

30B. (1) (a) Within six months after the date of commencement of this

paragraph or such longer period as the Minister may determine, the mobile

cellular operators may apply to the Authority for a third generation

telecommunication radio frequency spectrum licence to provide mobile

cellular telecommunication services and such other services as the mobile

cellular operators, from time-to-time, are licensed to provide.

(b) The Authority shall issue to each mobile cellular operator a third

generation telecommunication radio frequency spectrum licence contem-plated

in paragraph (a)—

(i) against the payment of such fees, to be payable over a period, as the

Minister shall determine by notice in the Gazette; and

(ii) subject to such conditions as the Authority may specify in that licence.

(c) For purposes of paragraph (b)(i), the Minister may specify by notice

in the Gazette a multiple payment schedule pursuant to which the mobile

cellular operators shall make payment, and the terms and conditions of such

payment.

(d) Prior to the date a third generation radio frequency spectrum licence

takes effect, the holder of a licence which exists at the commencement of

the Telecommunications Amendment Act, 2001, shall, in accordance with

radio regulations governing migration and clearing of radio spectrum

bands, clear the spectrum to be occupied by such mobile cellular operator.

(2) (a) The second national operator and Telkom shall each be deemed to

be a holder of a third generation telecommunication radio frequency

spectrum licence to provide public switched telecommunications services,

and such other services as the second national operator and Telkom, from

time-to-time, are licensed to provide.

(b) Within six months after the date the second national operator is

granted a public switched telecommunications service licence, or such

longer period as the Minister may determine, Telkom may apply to the

Authority for a third generation telecommunication radio frequency

spectrum licence to provide public switched telecommunication services,

and such other services as Telkom, from time-to-time, is licensed to

provide.

(c) The Authority shall issue to the second national operator and Telkom

a third generation telecommunication radio frequency spectrum licence

contemplated in paragraph (a) or (b), as the case may be—

(i) against the payment of such fees, to be payable over a period, as the

Minister shall determine by notice in the Gazette; and

(ii) subject to such conditions as the Authority may specify in that licence.

(d) For purposes of paragraph (c)(i), the Minister may specify by notice

in the Gazette a multiple payment schedule pursuant to which the second

national operator and Telkom, respectively, shall make payment and the

terms and conditions of such payment.

(3) (a) Holders of a third generation telecommunication radio frequency

spectrum licence shall co-ordinate, in good faith, their respective frequency

usage with other such licensees to—

(i) avoid harmful interference among licensees;

(ii) ensure efficient use of any applicable frequency band; and

(iii) allow for the provision of cost-efficient services.

(b) The Authority may prescribe regulations governing the co-ordination

contemplated in paragraph (a), which may include a process for the speedy

resolution of disputes among licensees.

(4) In determining the fees contemplated in subsections (1)(b)(i) and

(2)(c)(i), the Minister shall take into account—

(i) MHz pair per population per licence year;

(ii) provision of paired or unpaired spectrum;

(iii) technical and administrative cost of spectrum management, including

projected costs for Authority involvement in frequency co-ordination

contemplated in subsection (3); and

(iv) any other matter that is consistent with section 2.’’ .

6. The following sections are hereby inserted in the principal Act after section 32:

32A. (1) From 7 May 2002 until 7 May 2005 Telkom and the second

national operator shall be the holders of public switched telecommunica-tion

service licences.

(2) (a) For a period of two years after the date of commencement of the

public switched telecommunication service licence the second national

operator may use Telkom’s facilities on a resale basis in accordance with

agreements concluded between the parties for the purposes of providing

public switched telecommunication services.

(b) The agreements contemplated in paragraph (a) become effective

within 60 days of the issuing of the public switched telecommunication

service licence to the second national operator.

(3) Where Telkom and the second national operator fail to conclude

agreements contemplated in subsection (2), or after the parties have

negotiated in good faith and used their reasonable endeavours to resolve

disputes relating to such agreements, either party may request the Authority

in writing to resolve all outstanding issues.

(4) (a) Where the Authority receives a request contemplated in

subsection (3), it shall, within 30 days of that request, determine the terms

and conditions of the agreement in a manner consistent with this Act.

(b) Where the Authority makes a determination in terms of paragraph (a),

the determination shall be binding on the parties and shall form part of the

agreement between the parties.

(c) The agreement contemplated in paragraph (b) shall lapse two years

after the date of its conclusion.

(5) (a) Before 31 December 2003 the Minister shall—

(i) determine, by way of a market study, the feasibility of granting one or

more public switched telecommunication service licences in addition

to the licences referred to in subsection (1); and

(ii) by notice in the Gazette, publish the determination.

(b) In conducting the market study contemplated in paragraph (a), the

Minister shall consider—

(i) the Republic’s international obligations;

(ii) national and international market conditions prevailing at the time;

(iii) the Republic’s policy objectives; and

(iv) and any other relevant factor.

(6) (a) If the Minister determines that any additional public switched

telecommunication service licence may be granted—

(i) such licence may only come into effect by 8 May 2005; and

(ii) at least one of the additional operators shall be licensed to provide

service-based competition.

(b) A holder of a licence contemplated in paragraph (a) may—

(i) compete as a service-based licensee and may not provide its own

facilities until the Minister so determines; and

(ii) utilises the facilities of Telkom and the second national operator on a

resale basis for a period of two years from the date of commencement

of its public switched telecommunication service licence, in accor-dance

with agreements concluded between the parties for the purposes

of providing public switched telecommunication services.

(7) Where the Minister makes the determination contemplated in

subsection (5), the Authority may prescribe regulations to ensure equal and

non-discriminatory access to facilities among all licensed operators.

(8) In any case where telecommunication facilities are made available

pursuant to section 44 or the regulations promulgated thereunder to the

holder of a license to provide public switched telecommunication services,

such licence holder shall have the right of resale.

32B. (1) The second national operator shall be granted a public switched

telecommunication service licence on no less favourable terms and

conditions than those of the licence held by Telkom.

(2) Subject to subsection (3), such percentage of the equity interest of the

second national operator shall be set aside for Eskom and Transnet, as the

Minister, with concurrence of the Minister of Public Enterprises, may

determine.

(3) The final determination of the equity interest of Eskom and Transnet

in the second national operator shall be determined by the value of the

contribution of Eskom and Transnet, as the case may be, in the second

national operator.

(4) The contribution referred to in subsection (3) may include, among

other things—

(a) cash;

(b) rights of way;

(c) immovable property;

(d) personal rights; and

(e) other assets, including existing infrastructure, facilities and equip-ment.

(5) (a) For the purposes of this subsection, ‘‘ servitude’’ means any

servitude, lease, right of use or other real right (whether registered or not)

in or over land in favour of Eskom, Transnet and the South African Rail

Commuter Corporation Limited established in terms of the Legal Succes-sion

to the South African Transport Services Act, 1989 (Act No. 9 of 1989),

which existed immediately prior to the commencement of this Act, for the

conveyance or provision of electricity, telecommunications, pipelines,

railways, transport or electrical substations.

(b) Every servitude is hereby extended so as to include the additional

right to use the land to which such servitude relates for purposes of

providing a public switched telecommunication service or network by

means of telecommunication facilities.

(c) Eskom may allow any of its subsidiaries in respect of Eskom

servitudes to—

(i) utilise a servitude in respect of the additional right referred to in

paragraph (b) on such terms and conditions as may be agreed upon

between Eskom and the subsidiary;

(ii) allow any third party in which Eskom has an equity interest to utilise

the servitude in respect of that additional right on such terms and

conditions as may be agreed upon between the parties; or

(iii) utilise a servitude in respect of that additional right in order to provide

public switched telecommunication services to any third party on such

terms and conditions as may be agreed upon between the parties.

(d) Compensation as contemplated in section 25(3) of the Constitution

shall be payable by the party exercising the additional right as contemplated

in paragraph (b) to the registered land-owner concerned, to the extent that

the servitude becomes more onerous than the original servitude.

(e) Notice of the exercise or use of the right in terms of paragraph (c)

shall be given in writing to the registered owner of the land concerned,

either by personal service or by pre-paid registered post, and the

compensation contemplated in paragraph (d) shall be payable and shall be

assessed as at the date of such notice.

(f) Sections 9, 10, 11, 12(3), 12(5), 14 and 15 of the Expropriation Act,

1975 (Act No. 63 of 1975), shall with the necessary changes be applicable

in respect of any compensation claim, compensation offer and the payment

and determination of such compensation.

(g) The Registrar of Deeds shall make such entries or endorsements in or

on any relevant title deed or other documents in the office of the Registrar

or submitted to the Registrar, as may be necessary for the purposes of

paragraph (c).

(h) No fees or other levies shall be payable in respect of entries or

endorsements contemplated in paragraph (g).

(i) Paragraphs (c), (d), (e), (f), (g) and (h) apply with the necessary

changes to Transnet and its subsidiaries licensed in terms of this Act and the

South African Rail Commuter Corporation Limited.

32C. (1) With effect from 7 May 2002, Sentech Limited referred to in

section 4 of the Sentech Act, 1996 (Act No. 63 of 1996), shall be granted a

licence to provide—

(a) an international telecommunication gateway service enabling it to

operate as a carrier of carriers; and

(b) multimedia services to any person who requests such service.

(2) Sentech shall provide the multimedia service as a common carrier on

a reasonable, equitable and non-discriminatory basis.

(3) In respect of the granting of other multimedia services licences—

(a) the Minister shall invite applications on a date to be fixed by the

Minister by notice in the Gazette; and

(b) section 34(2)(b) and (c) apply with the necessary changes.

(4) On or before 31 December 2001, the Authority shall publish in the

Gazette draft licences, which shall include proposed conditions on which

Sentech Limited must provide the services contemplated in subsection (1).

(5) Within 30 days of the publication referred to in subsection (4),

Sentech Limited and any interested party may submit written comments to

the Authority in connection with the proposed conditions to the licence.

(6) After due consideration of the comments contemplated in subsection

(5), if any, the Authority shall finalise the licences and issue them to Sentech

with effect from 7 May 2002.

(7) The holder of a telecommunication service licence shall not be

precluded from providing services which are the same as, or similar to

multimedia services, provided that such services fall within the ambit of the

telecommunication service licence so held.

(8) No person who provides the service contemplated in subsection

(1)(b) shall permit such service to be used for the carrying of voice only

until a date to be fixed by the Minister by notice in the Gazette.’’ .

7. Section 33 of the principal Act is hereby amended by the substitution in subsection

(1) for paragraph (a) of the following paragraph:

‘‘ (a) as contemplated in sections 32C(1)(b), 34(2)(a)(i) to [iv] (v) and 39 to 41;

and’’ .

8. Section 34 of the principal Act is hereby amended—

(a) by the deletion in subsection (2)(a)(iv) of the word ‘‘ or’’ and by the insertion

in that subsection of the following subparagraph, the existing paragraph (v)

becoming paragraph (vi):

‘‘ (v) a multimedia service; or’’ .

(b) by the substitution in subsection (2) for paragraphs (b) and (c) of the following

paragraphs, respectively:

‘‘ (b) The Minister shall, in an invitation contemplated in paragraph

(a), specify—

(i) the kind of service in respect of which applications are invited;

(ii) the form in which applications shall be submitted and the manner in

which it is contemplated that the service shall be provided, [or] and

the place where and times when [a] any document in that regard

may be obtained from the Authority;

(iii) the period within and manner in which such applications shall be

lodged.

(c) Prior to publishing any invitation contemplated in paragraph (a),

the Minister shall consult with the Authority to determine the evaluation

criteria the Authority intends to use in making its recommendation to the

Minister pursuant to section 35(1)(a)(i) and the weighting factor

applicable to each evaluation criterion and the application of section

35(4) and (5).’’ ;

(c) by the substitution in subsection (3) for the words preceding paragraph (a) of

the following words:

‘‘ (3) In the case of an application for a licence to provide a

telecommunication service referred to in subsection (2) or any other

telecommunication service prescribed for the purposes of this subsection

the Authority [shall] may—’’;

(d) by the addition to subsection (3) of the following paragraph:

‘‘ (d) A hearing contemplated in paragraph (c) may be open to the

public.’’ .

(e) by the insertion after subsection (3) of the following subsections:

‘‘ (3A) The Authority may require an applicant or an interested party

who has lodged written representations in terms of subsection (3) to

furnish the Authority, within the period specified by it, with such further

information as may be reasonably necessary in order to consider the

application.

(3B) No application may be amended or varied after the period

contemplated in subsection (2)(b)(iii).’’ ;

(f) by the substitution in subsection (4) for paragraph (b) of the following

paragraph:

‘‘ (b) (i) The Authority may, at the request of an applicant or person

who lodged representations, determine that any document or information

to] that is commercially sensitive or any other matter reasonably

justifying confidentiality, shall not be open to public inspection, if such

document or information can be separated from the application,

representations or other documents in question.

(ii) For purposes of this paragraph commercially sensitive document

or information or other matter reasonably justifying confidentiality shall

exclude documents or information that was or becomes, or as a matter of

law should be, generally available to the public.’’ .

9. The following section is hereby substituted for section 35 of the principal Act:

35. (1) The Authority shall, after having duly considered any application

for a licence made in terms of this Act and any written submissions in

relation to the applications that may be called for by the Authority and

submitted to the Authority within the period determined by the Authority—

(a) in the case of an application for a licence referred to in section

34(2)(a), make its recommendation to the Minister, and propose

licence conditions; and

(b) in the case of any other licence application, notify the applicant of its

decision, the reasons therefor and the licence conditions.

(2) The Minister may in respect of a recommendation by the Authority

contemplated in subsection (1)—

(a) accept it;

(b) request further information from the Authority;

(c) refer it back to the Authority for further consideration; or

(d) reject it.

(3) In the consideration of applications in terms of this Act, due regard

shall be given to applications—

(a) by persons from historically disadvantaged groups; and

(b) which promote the empowerment and advancement of women in the

telecommunication industry.

(4) Without derogating from subsection (4), in the evaluation of equity

ownership held by persons from historically disadvantaged groups or held

by women in an application for a licence in terms of this Act, the Authority

shall give due preference for up to 30% of such equity ownership or such

higher equity ownership percentage as may be prescribed.

(5) Subject to section 36(6), a licence shall be granted on conditions

appropriate to the licence and consistent with the objects referred to in

section 2 and the other provisions of this Act.

(6) The Authority shall, where the application has been granted, issue the

licence in question to the applicant.

(7) Any licence granted in terms of this section, shall become effective on

the date specified therein.

(8) Nothing in this section derogates from the rights of an applicant to be

furnished with reasons for a decision under the Promotion of Administra-tive

Justice Act, 2000 (Act No. 3 of 2000).’’ .

10. The following section is hereby inserted in the principal Act after section 35:

35A. (1) Notwithstanding sections 34 and 35—

(a) in the case of a licence referred to section 34(2), the Minister may in

specific instances determine the manner in which applications may be

made, such as by way of auction or tender, or both, and the licensing

process and the licensing conditions that will apply; and

(b) for all other licences, the Authority may in specific instances prescribe

the licensing conditions that will apply.’’ .

11. The following sections are hereby inserted in the principal Act after section 36:

36A. (1) A ‘Public switched telecommunication service’ shall be a

telecommunication service to the general public on a subscription basis,

which shall include services such as—

(a) national long-distance telecommunication service;

(b) international telecommunication service;

(c) local access telecommunication service contemplated in section 39;

(d) public pay-telephone service;

(e) maritime telecommunication service;

(f) service comprising the provision of telegrams;

(g) fixed-mobile services;

(h) the supply of telecommunications equipment, the installation, bring-ing

into service, maintenance and repair of that part of the public

switched telecommunication network that is provided, maintained and

operated by the public switched telecommunication services licensee

for the purposes of providing any telecommunication service, such as

the provision of telecommunication circuits for—

(i) private circuits;

(ii) links between sites of the same operator or multiple operators;

(iii) telecommunication facilities used for the provision of private

telecommunication networks;

(iv) telecommunication facilities used for the provision of value-added

network services;

(v) telecommunication facilities used for the provision of telecom-munication

services in under-serviced areas contemplated in

section 40A;

(vi) telecommunication facilities used to provide voice over internet

protocol;

(vii) third generation telecommunication facilities;

(viii) telecommunication facilities to provide fixed-mobile services in

the 1800MHz frequency band; and

(i) any other service reasonably complementary to the provision of those

services (whether provided on a fixed or fixed mobile basis) such as

the provision, repair and maintenance of equipment located on a

customer’s premises and any other telecommunications apparatus of

any kind.

36B. (1) ‘public switched telecommunication networks’ shall be the

telecommunication systems which are installed or otherwise provided,

maintained and operated by a public switched telecommunication service

licensee for the purpose of providing public switched telecommunication

services and fixed-mobile services such as—

(a) a local access network;

(b) a national long-distance network; and

(c) an international network;

by whatever means such as copper cables, wireless loops, microwave links,

optic fibre cables, satellite earth stations, space segments and satellite

systems, by means of which signals can be conveyed between all or any

of—

(i) two or more terminal connection points;

(ii) two or more network connection points;

(iii) a terminal connection point and a network connection point;

(iv) a terminal connection point or a network connection point, as the case

may be, and a corresponding point in another country;

(v) a public pay-telephone and the terminal connection point, a network

connection point or a corresponding point in another country.

(2) The systems contemplated in subsection (1) shall not include

telecommunication equipment located on the premises of a customer,

unless it is meant for public pay-telephones or mobile telecommunications

on the premises of a customer.’’ .

12. The following section is hereby substituted for section 37 of the principal Act:

‘‘ Mobile cellular telecommunication services

37. (1) (a) Vodacom (Pty.) Ltd. and Mobile Telephone Networks (Pty.)

Ltd., companies incorporated in terms of the Companies Act, 1973 (Act No.

61 of 1973), shall each be deemed to be the holder of a licence in terms of

this Act to provide a mobile cellular telecommunication service in

accordance with the terms and conditions of the telecommunications

licences and multiparty implementation agreement published under Gen-eral

Notice No. 1078 of 29 October 1993: Provided that each such company

shall apply to the Minister through the Authority within six months after the

date of commencement of this Act, or such extended period as the Authority

may allow, for such a licence and the Minister shall grant the application

and the Authority shall issue to that company a licence which shall, subject

to section 42(3)(a), incorporate those terms and conditions.

(b) Cell C (Pty.) Ltd., a company incorporated in terms of the Companies

Act, 1973 (Act No. 61 of 1973), shall be the holder of a licence in terms of

this Act to provide a mobile cellular telecommunication service in

accordance with the terms and conditions as specified in its licence issued

to it by the Authority on 25 June 2001.

[(d)] (2) A licence contemplated in [paragraph (a)] subsection (1) shall

contain a condition prohibiting the mobile cellular telecommunication

service in question, until a date to be fixed by the Minister by notice in the

Gazette, from utilising any fixed lines which may be required for the

provision of the service other than fixed lines made available by Telkom or

any other person providing a public switched telecommunication service.

(3) The holder of a licence in terms of this section shall not be required

to hold a licence contemplated in section 34(2)(a)(i), (iii) or (iv) or section

39 or 40 to enable him or her to provide the mobile cellular telecommuni-cation

service in question.

(4) (a) Before 31 December 2003 the Minister shall—

(i) determine, by way of a market study, the feasibility of granting a

mobile cellular telecommunication licence in addition to the licences

referred to in subsection (1); and

(ii) by notice in the Gazette, publish the determination.

(b) In conducting the market study contemplated in paragraph (a), the

Minister shall consider the Republic’s international obligations;

(5) If the Minister determines that any additional licence may be granted,

such licence may be issued after 31 December 2003 in terms of section

34.’’ .

13. Section 38 of the principal Act is hereby amended by the substitution for

subsection (1) of the following subsection:

‘‘ (1) No [person] persons other than Telkom shall be granted a licence to provide

national long-distance telecommunication services until after [a date to be fixed

by the Minister by notice in the Gazette] 7 May 2002.’’ .

14. Section 39 of the principal Act is hereby amended—

(a) by the substitution in subsection (1) for paragraph (a) of the following

paragraph:

‘‘ (a) No [person] persons other than Telkom shall be granted a licence

to provide a local access telecommunication service until after [a date to

be fixed by the Minister by notice in the Gazette] 7 May 2002.’’ ; and

(b) by the substitution in subsection (2) for paragraph (a) of the following

paragraph:

‘‘ (a) No [person] persons other than Telkom shall be granted a licence

to provide a public pay-telephone service until after [a date to be fixed

by the Minister by notice in the Gazette] 7 May 2002.’’ ;

(c) by the addition to subsection (2) of the following paragraph:

(c) nothing in this section shall be construed as limiting applications for

a licence contemplated in paragraph (a) to public switched

telecommunication services licensees only.’’ .

15. Section 40 of the principal Act is hereby amended—

(a) by the substitution for subsection (2) of the following subsection:

‘‘ (2) A licence to provide any value-added network services, includ-ing,

but not limited to, electronic data interchange, [E-mail] electronic

mail, protocol conversion, access to a database or a managed data

network service, shall contain a condition that the service in question

[shall] be provided by means of telecommunication facilities—

(a) until 7 May 2002, provided by Telkom or made available to Telkom

as contemplated in section 44 [until a date to be fixed by the

fixed in respect of national long-distance facilities]; and

(b) after 7 May 2002, provided by Telkom and the second national

operator or any of them until a date fixed by the Minister by notice

in the Gazette.’’ ; and

(b) by the addition to subsection (3) of the following paragraph, the existing

subsection becoming paragraph (a):

‘‘ (b) Without prejudice to any rights of Telkom under its public

switched telecommunication service licence which exist at the com-mencement

of the Telecommunications Amendment Act, 2001, the

second national operator and the licensees contemplated in section 40A

may provide voice over internet protocol after 7 May 2002.’’ .

16. The principal Act is hereby amended by the insertion of the following section after

section 40:

40A. (1) The Minister shall by notice in the Gazette determine those

geographic areas where there is teledensity of less than 5% and in respect of

which small businesses may apply to the Authority for under-serviced area

licences to provide such services or facilities.

(2) (a) The Authority may issue an under-serviced area licence to a small

business on application in the prescribed manner.

(b) In the consideration of applications in terms of this section, due

regard shall be given to applications—

(i) by persons from historically disadvantaged groups; and

(ii) from applicants which are managed and controlled, or owned, by

women.

(3) An under-serviced area licensee shall provide any telecommunication

services, including voice over internet protocol services, fixed-mobile

services and public pay telephones, in respect of the area to which the

licence applies.

(4) Under-serviced area licences granted by the Minister shall become

effective after 7 May 2002.

(5) All under-serviced area licences granted under this section shall be

issued on materially the same terms and conditions.

(6) Under-serviced area licensees may by agreement obtain interconnec-tion

to the networks of public switched telecommunication service

licensees and mobile cellular operators, and through the national long-distance

telecommunication service of a public switched telecommunica-tion

service licensee to the international telecommunication gateway of a

carrier of carrier’s licensee, if such agreement complies with—

(a) section 43 and any regulations prescribed to give effect to that section;

and

(b) the prescribed terms and conditions, including price, in terms of which

under-serviced area licensees may obtain such interconnection.’’ .

17. Section 41 of the principal Act is hereby amended—

(a) by the substitution in subsection (1) for paragraphs (a) and (b) of the following

paragraphs:

‘‘ (a) A person providing a telecommunication network for purposes

principally or integrally related to the operations of such person

(hereinafter referred to as a private telecommunication network), shall,

notwithstanding the provisions of sections 32(1) and 33(1) and regard-less

of whether or not such network is utilised by means of telecommu-nication

facilities made available by Telkom, or the second national

operator, not require a licence except as contemplated in paragraph (b).

(b) A private telecommunication network licence shall, subject to the

regulations, be required for the provision of a private telecommunication

network, where such network is interconnected to the telecommunica-tion

system of Telkom or any other person providing a public switched

telecommunication [network] service.’’ ;

(b) by the deletion of subsection (3); and

(c) by the addition of the following subsections:

‘‘ (10) (a) The Minister shall, with the concurrence of the Minister of

Education, establish an entity to construct and operate an educational

network.

(b) The entity contemplated in paragraph (a) shall be deemed to have

been granted a private telecommunications network licence to link all

public schools and public further education and training institutions

defined in the South African Schools Act, 1996 (Act No. 84 of 1996), and

the Further Education and Training Act, 1998 (Act No. 98 of 1998),

respectively, as well as such other education and training institutions as

may be determined by the Minister of Education.

(11) (a) The Minister shall, with the concurrence of the Minister of

Transport, establish an entity to construct and operate a private

telecommunication network to fulfil South Africa’s obligations in terms

of—

(a) the International Convention for the Safety of Life at Sea (SOLAS)

1974/78;

(b) Annexure 12 to the Convention on International Civil Aviation,

signed by South Africa on 7 December 1944 in Chicago; and

(c) the International Convention on Maritime Search and Rescue, 1979.

(b) The entity contemplated in paragraph (a) shall—

(i) be referred to as ‘‘ Maritime and Aeronautical Radio Services’’ ; and

(ii) be deemed to have been granted a private telecommunications

network licence.’’ .

18. Section 43 of the principal Act is hereby amended—

(a) by the substitution for subsection (1) of the following subsection:

‘‘ (1) (a) Any public switched telecommunication service licensee

shall, when requested by any other person providing telecommunication

services, interconnect its telecommunication systems to the telecommu-nication

system of the other person, in accordance with the terms and

conditions of an interconnection agreement entered into between the

parties, unless such request is unreasonable.

(b) For the purposes of paragraph (a), a request is reasonable where the

Authority determines that the requested interconnection—

(i) is technically feasible;

(ii) will promote the efficient use of the public switched telecommuni-cation

network;

(iii) can be implemented on a reciprocal basis between the parties.

(c) An agreement contemplated in paragraph (a) shall be entered into

within the prescribed period or such extended period as the Authority

may allow in any particular case.

(d) The parties concerned shall, unless exempted by regulation—

(i) notify the Authority if any request contemplated in paragraph (a) is

made;

(ii) where the reasonableness of any such request is disputed, refer the

dispute to the Authority for its decision;

(iii) where the parties are unwilling or unable to negotiate or agree on

terms and conditions within the period or extended period

contemplated in paragraph (c), submit all outstanding issues to the

Authority for resolution.’’ ;

(b) by the substitution in subsection (4) for paragraphs (a) and (b) of the following

paragraphs, respectively:

‘‘ (a) in the case of a dispute relating to reasonableness as contemplated in

subsection (1)(d)(ii), make a determination taking into consider-ation

the factors referred to in subsection (1)(b), and any other

relevant factor;

(b) in the case of unwillingness or inability by the parties to negotiate or

agree on the terms and conditions of interconnections, the Authority

may—

(i) impose terms and conditions in accordance with the guidelines

contemplated in subsection (3); or

(ii) propose terms and conditions in accordance with the guide-lines

contemplated in subsection (3) which, subject to renego-tiations,

shall be agreed to by the parties within such period as

the Authority may specify.

(c) by the substitution in subsection (5) for paragraph (b) of the following

paragraph:

‘‘ (b) Where the Authority determines that any terms and conditions are

not consistent with the guidelines contemplated in subsection (3), it may

direct the parties to [negotiate] renegotiate and agree on new terms and

conditions within such period as the Authority may specify, or itself

propose terms and conditions consistent with those guidelines and

which, subject to renegotiation, shall be agreed by the parties within such

period as it may specify, and the provisions of subsection [(1)(e)(iii)]

(1)(d)(iii) and (4)(b) shall apply with the necessary changes.’’ ; and

(d) by the addition of the following subsections:

‘‘ (10) (a) Five years after the date on which an interconnection

agreement is concluded a party to that agreement may request the other

party or parties to promptly negotiate in good faith to modify or amend

some or all of the terms of such agreement.

(b) Subsections (1) to (6) and the regulations promulgated under this

section shall apply, with the necessary changes, in relation to any

proposed modification or amendment of any term or condition contem-plated

in paragraph (a).

(11) Interconnection rates and any agreement with regard thereto shall

be made public.’’ .

19. Section 44 of the principal Act is hereby amended—

(a) by the deletion of subsection (1);

(b) by the substitution for subsections (2), (3) and (4) of the following

subsections, respectively:

‘‘ (2) Telkom and any other provider of a public [fixed] switched

telecommunication service shall, when requested by any other person

providing a telecommunication service, including a private telecommu-nication

network, lease or otherwise make available telecommunication

facilities to such other person pursuant to an agreement to be entered into

between the parties, unless such request is unreasonable.

(3) The provisions of section [43(1)(c), (d) and (e)] 43(1)(b)(i) and

(ii), (c) and (e) shall apply, with the necessary changes, in relation to any

request and agreement contemplated in [subsections (1) and] subsec-tion

(2).

(4) Every agreement for the leasing [or otherwise making available]

of telecommunication facilities or resale, including any agreement

contemplated in [subsections (1) and] subsection (2), shall, unless

exempted by the regulations, be lodged by the parties with the Authority

to enable it to determine whether the agreement is consistent with the

guidelines contemplated in subsection (5).’’ ;

(c) by the addition to subsection (5) of the following paragraph, the existing

subsection becoming paragraph (a):

‘‘ (b) The guidelines contemplated in paragraph (a) may relate to—

(i) resale, including the basis for determining wholesale and retail

tariffs; and

(ii) the manner in which telecommunication facilities are made

available.’’ ; and

(d) by the substitution for subsection (7) of the following subsection:

‘‘ (7) (a) In the application of section [43(1)(e)(iii)] 43(1)(d)(iii) and

(4)(b) in relation to making the telecommunication facilities of [Telkom]

a public switched telecommunication service licensee available to

another person and where the Authority is satisfied that [Telkom] the

holder of a public switched telecommunication service licence 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 as contemplated in section 43(4)(b),

authorise that person to provide or obtain any necessary telecommuni-cation

facilities other than from [Telkom] such holder on conditions

determined by the Authority, notwithstanding the provisions of sections

[37(2)(c),] 38(2), 40(2) and 41(2)(a) and this section.

(b) Subject to section 32A(2) and (4), notwithstanding the guidelines

contemplated in subsection (5), no public switched telecommunication

service licencee shall be required to unbundle its local loop for the period

of two years referred to in section 32A(2)(a) and (4).’’ .

20. Section 45 of the principal Act is hereby amended—

(a) by the substitution for subsection (2) of the following subsection:

‘‘ (2) The manner of determining fees and charges shall be prescribed

only in respect of fields where no or insufficient competition exists:

Provided that within 12 months after the date of commencement of this

Act, the Minister shall determine such fees and charges in respect of

Telkom, and such fees and charges shall be in force until the later of—

(a) the third anniversary of the date on which the Minister issued a

licence to Telkom in accordance with section 36(1)(a); and

(b) the date when the Authority prescribes a new determination of fees

and charges in respect of Telkom.’’ ; and

(b) by the addition of the following subsection:

‘‘ (3) From a date to be determined by the Minister, all public schools

as defined in the South African Schools Act, 1996 (Act No. 84 of 1996),

and all public further education and training institutions as defined in the

Further Education and Training Act, 1998 (Act No. 98 of 1998), shall be

entitled to a 50% discount on—

(a) all telecommunication calls to an internet service provider; and

(b) any connection or similar fees or charges levied by an internet

service provider for accessing the internet or transmitting and

receiving any signals via the internet or for such access and

transmission and reception.’’ .

21. Section 53 of the principal Act is hereby amended by the addition of the following

subsection, the existing section becoming subsection (1):

‘‘ (2) (a) The Authority may, with regard to the matters referred to in subsection

(1), make regulations to ensure efficient and effective monitoring and investigation

of uncompetitive actions, ensuring protection of consumer interests and for the

speedy resolutions of complaints in regard thereto.

(b) The Authority shall report annually to the Minister on the overall status and

efficiency of the regulations contemplated in paragraph (a).’’ .

22. Section 54 of the principal Act is hereby amended by the substitution for

subsection (1) of the following subsection:

‘‘ (1) No person shall use, supply, sell, offer for sale or lease or hire, any type of

telecommunication equipment or facility, including radio apparatus, in connection

with telecommunication unless that type has, subject to subsection (2), been

approved by the Authority.’’ .

23. Section 58 of the Act is hereby amended by the addition of the following

subsection, the existing section becoming subsection (1):

‘‘ (2) The Minister may, by notice in the Gazette, appoint a board of up to seven

members to provide oversight of and guidance to the Universal Service Agency.’’ .

24. Section 61 of the principal Act is hereby amended—

(a) by the substitution for subsection (2) of the following subsection:

‘‘ (2) The [Authority] Agency shall utilise any money contemplated in

subsection (1) in accordance with the statement of estimated expenditure

referred to in subsection (3).’’ ; and

(b) by the substitution in subsection (3) for the words preceding paragraph (a) of

the following words:

‘‘ The [Authority] Agency—’’.

25. Section 65 of the principal Act is hereby amended by the substitution for

subsection (4) of the following subsection:

‘‘ (4) The Universal Service Fund shall be administered by the Agency subject to

the control and in accordance with the instructions of the [Authority] Minister.’’ .

26. Section 66 of the principal Act is hereby amended—

(a) by the substitution for subsections (1) and (2) of the following subsections,

respectively:

‘‘ (1) The money in the Universal Service Fund shall be utilised

exclusively for the payment of subsidies—

(a) for the assistance of needy persons towards the cost of the provision

to or the use by them of telecommunication services;

(b) [subject to subsection (3)] to Telkom and to any other holder of a

licence in terms of Chapter V which imposes obligations on the

holder relating to the extension of its [public switched] telecom-munication

service to areas and communities which are not served

or not adequately served by telecommunication services, for the

purpose of financing such extension;

(c) to public schools and public further education and training

institutions referred to section 45(3) for the procurement of internet

services and equipment necessary to access the internet;

(d) for the establishment of centres where access can be obtained to

telecommunication facilities;

(e) for the establishment of public information terminals; and

(f) to assist small businesses and cooperatives to acquire and construct

infrastructure to provide telecommunication services to areas which

are not served or not adequately served by telecommunication

services; and

(g) to facilitate the provision of multimedia services.

(2) The money in the fund shall be apportioned for the separate

purposes [of paragraph (a) and paragraph (b) of] referred to in

subsection (1) in accordance with [the prescribed] a formula determined

by the Minister by notice in the Gazette.’’ ;

(c) by the deletion of subsection (3); and

(d) by the substitution in subsection (4) for the words preceding paragraph (a) of

the following words:

‘‘ The [Authority] Minister may, for the purposes of payments referred to

in [subsections] subsection (1)(a) and [(3) prescribe] (b) by notice in the

Gazette determine—’’.

27. Section 67 of the principal Act is hereby amended by the substitution in subsection

(2) for paragraph (a) of the following paragraph:

‘‘ (a) the basis and manner of determination of such contributions, which shall not

exceed 0.5% of a licencee’s annual turnover; and’’ .

28. The principal Act is hereby amended by the insertion after section 67 of the

following section:

67A. (1) The Agency may award universal access projects by public

competitive bid to the qualified bidder that requests subsidy for such

project.

(2) The Agency shall in allocating the subsidy take into account, inter

alia, the provisions of section 2.

(3) The subsidy for universal access projects shall be paid out of the

Universal Service Fund.

(4) The Agency shall supervise the execution of projects awarded under

subsection (1).’’ .

29. The following Chapter is hereby inserted in the principal Act, after Chapter IX:

78. In this Chapter, unless the context otherwise indicates, ‘emergency

organisation’ means, in respect of any locality, the relevant police, fire,

ambulance or traffic authority or coast guard services for that locality and

any other similar organisation providing assistance to the public in

emergencies.

79. (1) The Minister may by notice in the Gazette establish public

emergency communications centres to be known as ‘112 Emergency

Centres’

(2) A 112 Emergency Centre is a communications service centre by

means of which the user of a public telephone system has the ability to

reach an emergency centre by dialling the numerals 112 in order to request

an emergency service.

(3) 112 Emergency Centres shall be accountable to the Minister.

(4) 112 Emergency Centres shall be exempted from holding a licence to

provide telecommunication services in terms of any section of this Act.

80. (1) 112 Emergency Centres shall transmit any telecommunication

request for an emergency service to any emergency organisation.

(2) Licensees required to carry calls to 112 Emergency Centres may not

levy any charge on the caller for placing calls to 112 Emergency Centres.

(3) Licensees transporting any telecommunication from 112 Emergency

Centres to any emergency organisation shall be entitled to recover from the

relevant emergency organisation the reasonable cost that it incurs in

transporting such telecommunication.

81. (1) The number 112 is hereby established as the exclusive national

public emergency number.

(2) No person may apply for the registration in terms of applicable

intellectual property legislation, or any other law, of any mark or domain

name containing the numerals 1-1-2 in that sequence.

(3) No person may call the national emergency telecommunication

number, 112, for any purpose other than a request for an emergency service

contemplated in section 79(1).

82. (1) As far as practicably possible, 112 Emergency Centres shall have

voice, data and global positioning systems capability.

(2) 112 Emergency Centres shall develop and apply common technical

standards and standard operating procedures as directed by the Minister

from time to time by notice in the Gazette.

(3) Subject to obtaining an appropriate radio frequency licence in

accordance with section 30, 112 Emergency Centres may establish their

own radio networks, provided such networks are used exclusively to

communicate calls to 112 Emergency Centres or emergency organisations.

(4) Emergency Centres may display the 112 public emergency number

on public roads and other public places without cost.’’ .

30. The following sections are hereby inserted in the principal Act, after section 89:

‘‘ Directory services

89A. The Authority may prescribe, or impose through licence

conditions, as the case may be, measures in respect of directories and

directory enquiry services, regarding—

(a) the protection of personal data;

(b) the protection of privacy;

(c) language preferences;

(d) the prevention of fraud;

(e) the prohibition of marketing and unfair trading practices;

(f) the provision of assistance to law enforcement or other public safety

officials;

(g) related charges;

(h) the establishment of a national directory information database; and

(i) such other related matters as the Authority shall determine.’’ .

89B. The Authority shall allocate a four digit number through which the

public can access government directory information services free of charge.

31. Section 96 of the principal Act is hereby amended—

(a) by the substitution for subsection (1) of the following subsection:

(1) The Authority may make regulations in relation to—

(a) any matter which in terms of this Act shall or may be prescribed by

regulation;

(b) any matter necessary or expedient for the regulation of telecommu-nication

activities;

(c) any matter of procedure or form which may be necessary or

expedient to prescribe for the purposes of this Act.

(b) by the substitution for subsection (4) of the following subsection:

‘‘ (4) The Authority shall, not less than [three months] one month

before any regulation is made, cause the text of such regulation to be

published in the Gazette, together with a notice declaring its intention to

make that regulation and inviting interested persons to furnish the

Authority with written comments thereon [or representations in regard

thereto].’’ .

(c) By the substitution in subsection (5), for the words preceding paragraph (a),of

the following words:

The provisions of subsection [(1)] (4) shall not apply in respect of—

(d) by the addition of the following subsection:

‘‘ (8) When prescribing any regulation, the Authority shall give due

regard to section 2(j).’’ .

32. The following section is hereby inserted in the principal Act after section 96:

96A. (1) The Director-General shall establish and manage a museum that

depicts the evolution and the history of the telecommunication sector in

South Africa.

(2) The museum and its contents shall be a national asset as defined in the

National Heritage Resources Act, 1999 (Act No. 25 of 1999).

(3) The content of the museum housed in the Telkom Museum on

Telecommunication History shall be transferred to the museum established

in terms of subsection (1).

96B. (1) (a) The Minister shall, as soon as possible after the commence-ment

of this section, develop an Information, Communication and

Technology (ICT) strategy.

(b) The strategy shall be reviewed every two years.

(c) The strategy shall be published in the Gazette when it has been

developed or reviewed.

(2) When developing or reviewing the strategy, the Minister shall give

due regard to—

(a) the Republic’s national objectives;

(b) section 2(r) and (s);

(c) the Republic’s international obligations; and

(d) any other relevant factor.’’ .

33. Section 101 of the principal Act is hereby amended by the deletion in paragraph

(b) of the word ‘‘ or’’ and the insertion after that paragraph of the following paragraph:

‘‘ (c) contravenes the provisions of sections 54 and 56;

(d) contravenes the provisions of section 81(2) or (3);’’ .

34. The laws specified in the Schedule are hereby repealed or amended, as the case

may be, to the extent set out in the third column thereof.

35. The regulations made under section 52 regarding limitations on ownership and

control in respect of mobile cellular telecommunication service published in Gazette

No. 19828 on 5 March 1999, are hereby withdrawn.

36. This Act is called the Telecommunications Amendment Act, 2001.

Act No. 143 of 1993

National Emergency Tele-phone Service Act, 1993

1. The repeal of the whole.

Act No. 63 of 1996

Sentech Act, 1996

1. The substitution for section 5 of the following section:

‘‘ 5. The main object and the main business of the Company shall be to pro-vide— (i) as a common carrier, broadcasting signal distribution for broad-casting licensees in accordance with the provisions of the Independent Broadcasting Authority Act; and (ii) telecommunication services in accordance with the provisions of the Telecommunic-tions Act, 1996 (Act No. 103 of 1996).’’ .

MEMORANDUM OF OBJECTS OF THE TELECOMMUNICATIONS
AMENDMENT BILL, 2001
1. PURPOSE
The Telecommunications Amendment Bill, 2001 (‘‘ Bill’’ ), creates the legal frame-work
for the South African telecommunications landscape following the end of
Telkom’s exclusivity period. The Bill updates the Telecommunications Act, 1996
(‘‘ Act’’ ), to bring it in line with technological, regulatory and industry developments
over the past five years in South Africa and comparable international jurisdictions. The
Bill includes a number of measures necessary to facilitate the IPO of Telkom.
The Bill contemplates, amongst other matters:
1.1 Managed liberalisation of the telecommunications industry through (a) the
introduction in 2002 of the SNO (Second National Operator) in which a stake is reserved
for Esi-tel and Transtel respectively and black economic empowerment; (b) the award in
2002 of an international and multimedia licence to Sentech; and (c) the introduction in
2005 of at least one service-based competitor to Telkom and the SNO. The SNO may use
Telkom’s facilities, subject to an agreement to share facilities between them, for a
two-year period. At the end of this period the SNO may only use its own facilities and
future service-based operators will have a choice between the facilities of Telkom and
the SNO.
1.2 Convergence and technological development in the communications industry
to be recognised through inter alia allowing Telkom and the SNO to use wireless
technology in its operations and the award of a multimedia licence to Sentech. This
license will allow services such as video-on-demand, pay-per-view and internet over
television.
1.3 Stimulating SMME involvement in the telecommunications industry and
increasing teledensity in South Africa through the introduction of under-serviced area
licenses in areas where teledensity is currently below five per cent (5%). In addition, the
Universal Service Fund may be used to assist SMME’s in providing telecommunication
infrastructure and service in these under-serviced areas.
1.4 Assignment of the 1800 MHz radio frequency spectrum and 3G licenses to
Telkom, the SNO, Vodacom, MTN and the Cell C in an orderly and non-discriminatory
manner.
1.5 Restructuring of the universal service agency and increasing the size of the
Universal Service Fund. A seven-member board will provide oversight over the
universal service agency. The mandate of the universal service agency is clarified to
include the promotion of telecentres, internet in public schools and public information
terminals.
1.6 Introducing an e-rate to stimulate and facilitate internet usage by public schools.
The e-rate will allow public schools a 50% discount on calls to access the internet as well
as internet access charges.
1.7 A set-aside for persons from historically disadvantaged groups in major
telecommunication licenses. In the evaluation of applications for major licenses, ICASA
may give preference for up to 30% (or such higher percentage as may be prescribed) of
the equity held by persons from historically disadvantaged groups. In addition, in the
award of licenses ICASA must give due regard to applications which include women.
1.8 Introducing number portability and carrier pre-selection. The managed
liberalisation of the telecommunications industry requires the introduction of number
portability (in 2005) and carrier pre-selection (in 2005). ICASA will prescribe detailed
regulations to facilitate this.
1.9 Establishing 112 Emergency Centers that will enable end users to be connected
to appropriate emergency organisations through dialing ‘‘ 112’’ . 112 Emergency Centres
will be linked via a national radio network and may use state of the art technology.
1.10 Miscellaneous matters are also addressed in the Bill, such as (a) the
introduction or clarification of certain definitions; (b) streamlining of the application
process for licenses; (c) details on the basis of the involvement of Esi-tel and Transtel in
the SNO; (d) provision for additional methods for awarding licenses; (e) the right of
VANS operators to provide virtual private networks; (f) the right to renegotiate
interconnection agreements that have been in place for longer than five years; (g) the
repeal of the current cross-ownership regulation; (h) the provision of directory services
in a post-exclusivity environment; (i) provision for the regulation of Maritime time
25.Services by the Minister in consultation with the Minister of Transport; and (j)
establishment of a telecommunications history and development museum.
2. CLAUSE-BY-CLAUSE ANALYSIS
2.1 Definitions (section 1). Definitions have been inserted to—
(a) facilitate the managed liberalisation of the telecommunications industry and
to recognise that multiple operators will participate in the South African
telecommunications industry following the expiration of Telkom’s exclusivity
in May 2002 (for example, the definitions of ‘‘ carrier of carriers’’ , ‘‘ carrier
pre-selection’’ , ‘‘ directories’’ and ‘‘ directory enquiry service’’ ; ‘‘ number
portability’’ ; ‘‘ resale’’ ,’’ second national operator’’ );
(b) recognise new types of licences or technological development (e.g., the
definitions of ‘‘ multimedia service’’ ; ‘‘ small business’’ ; ‘‘ virtual private
network’’ , ‘‘ fixed mobile service’’ , ‘‘ voice over internet protocol’’ and ‘‘ third
generation services licence’’ );
(c) facilitate the granting of rights to certain entities (e.g., the definitions of
‘‘ Esi-tel’’ ; ‘‘ Sentech’’ and ‘‘ Transtel’’ ); and
(d) facilitate ease of reference (e.g., the definitions of ‘‘ international telecommu-nication
service’’ ; ‘‘ national long-distance telecommunication service’’ ;
‘‘ public switched telecommunication network’’ , ‘‘ public switched telecom-munication
service’’ ).
These definitions are also discussed below in the context of the clauses in which they
appear.
2.2 Objects of the Act (section 2). A new section 2(r) has been inserted to recognise
the convergence of the telecommunications, broadcasting and information services
industries;
2.3 Application of the Act (section 3) In order to allow for the amendment and
insertion of section 2 (r) and multi-media (to the extent that it applies to broadcasting,
broadcasting signal distribution or broadcasting services frequency band) as an
exception permitting application of this Act.
2.4 Frequency Band Plans (section 29) In order to shorten the application procedure
by the Authority, the oral hearings have been excluded. This in effect brings the Bill in
line with international best practice.
2.5 1800MHz and 3G licences (sections 30A and 30B). A statutory mechanism has
been created for the award of radio frequency spectrum and 3G licences to each of the
two fixed line operators and three mobile operators. The Bill also provides for the
regulation by the Authority of frequency usage.
2.6 Liberalisation (sections 32A, 32B and 32C). The Bill specifies the introduction
of competition upon the expiration of Telkom’s exclusivity period in May 2002
through—
(a) the introduction in 2002 of the SNO in which a stake is reserved for Esi-tel,
Transtel respectively and black economic empowerment;
(b) the introduction in 2005 of an additional national operator subject to a
feasibility study in which a stake is reserved for black economic empower-ment;
(b) the award in 2002 of an international and multimedia licence to Sentech; and
(c) the introduction in 2005 of at least one service-based competitor to Telkom
and the SNO.
The SNO may use Telkom’s facilities, subject to an agreement between them, for a
two-year period. At the end of this period the SNO may only use its own facilities and
future service-based operators will have a choice between the facilities of Telkom and
the SNO.
2.7 Kinds of licences (section 33). The Bill expressly recognises ‘‘ multimedia
service’’ as a new licence category.
2.8 License applications (section 34). In order to create a licence for the SNO and the
TNO that ‘‘ mirrors’’ that of Telkom, the Bill allows the Minister to invite applications
for a combination of telecommunication licences.
The Bill mandates consultation between the Minister and ICASA on evaluation
criteria prior to the publication of the invitation to apply for a major telecommunication
licence.
Subject to the Promotion of Administrative Justice Act and in accordance with
international best practice, the Bill streamlines the application process for telecommu-
26.nication licences by reducing the number of oral hearings and focusing on written
submissions by interested parties and applicants.
Based on practical difficulties experienced in recent application processes, the Bill
simplifies the provisions relating to the confidentiality of information submitted to
ICASA.
2.9 Decision on applications (section 35). In accordance with international best
practice, the Bill confirms the presumed validity of licensing decisions pending
litigation related to such decisions, such that litigation does not delay the licensing
process.
The Minister is empowered to properly access the recommendation by the Authority
and either accept, reject or alternatively request further information or clarification from
the Authority in relation to a recommended applicant. The main aim is to eliminate the
previous limitations to the Minister’s ability to address the Authority’s recommenda-tions
to the extent of fully applying his or her mind.
The Bill provides that applications from women should receive due regard in the
evaluation process and also that ICASA may give preference for up 30% (or a higher
prescribed percentage) of the equity in an applicant held by persons from historically
disadvantaged groups or women.
2.10 Alternative licensing methods (section 35A). In accordance with international
best practice, the Bill empowers the Minister to apply alternative licensing methods.
Alternative licensing methods envisaged include the auction and/or the bidding method
as an alternative to the so-called beauty contest method currently contemplated in the
Act.
2.11 Public Switched Telecommunications Service (section 36A). The Bill
provides an elaboration to the definition of PSTS licence and provides details of services
to be provided under the licence. The aim is also to ensure that there is parity between
the services that Telkom at present provides in terms of its PSTS licence and what the
SNO will provide.
2.12 Public Switched Telecommunication Network (section 36B) The Bill provides
an elaboration on the definition of PSTN allowing for examples of networks to be
maintained and operated by the relevant PSTS and fixed-mobile services licensees.
2.13 MTN, Vodacom and Cell C licences confirmed (section 37). In anticipation of
the Telkom IPO, the Bill confirms the validity of MTN and Vodacom’s licences until
such time as they are granted their restated licenses pursuant to section 37. Further the
contents of the issued Cell C licence is confirmed and given legislative effect as is the
case of MTN and Vodacom.
2.14 National Long-Distance Telecommunication Service (section 38) in anticipa-tion
of the end of Telkom’s exclusivity the terms of subsection 3 of this section is
amended to allow the SNO to provide national long-distance services.
2.15 Local Access Telecommunication Service (section 39) in anticipation of the
end of Telkom’s exclusivity this section is amended to allow the SNO to provide local
access telecommunications service.
2.16 Voice over internet protocol by SNO and under-serviced area licensees
(section 40). In order to avoid any doubt, and consistent with the managed liberalisation
of the telecommunications industry, the SNO and under-serviced area licensees are
entitled to provide voice services over internet protocol from 7 May 2002.
2.17 Under-serviced area licences (section 40A). The Bill seeks to stimulate SMME
involvement in the telecommunications industry through the introduction of under-serviced
area licences in areas where teledensity is currently below 5%.
2.18 Virtual private networks, Edu-Net, MARS (section 41). In line with
technological development, the Bill provides that VANS licensees may operate virtual
private networks without obtaining a private telecommunication network licence.
Subsection 10 empowers the Minister in consultation with the Minister of Education
to establish an Education network (Edu-Net), to ensure access by public schools and
educational and training institutions to the network.
Subsection 11 empowers the Minister in consultation with the Minister of Transport
to establish a Maritime and Aeronautical Radio Services (MARS), to ensure South
Africa fulfils its obligations in terms of the International Convention on Safety and Life
at Sea (SOLAS) 1974/8 and Annexure 12 to the Convention on International Civil
Aviation.
2.19 Interconnection (section 43). The Bill provides parties to interconnection
agreements the right to seek its renegotiation after five years. Without undermining legal
certainty, this will ensure that no party is locked into an inefficient or unfair long-term
27.interconnection arrangement — a situation that will ultimately prejudice consumer
rights.
2.20 Facility sharing (section 44). The Bill amends section 44 to be consistent with
the two-year period during which Telkom and the SNO may share infrastructure,
whereafter these two facilities-based competitors may no longer share facilities.
The Bill provides the basis for ICASA to prescribe detailed provisions that will deal
with resale during the two-year period and thereafter.
2.21 Price regulation (section 45). In anticipation of the Telkom IPO, the Bill
confirms the continued validity of Telkom’s most recent price determination until such
time as ICASA determines the next price determination.
An e-rate is introduced to stimulate and facilitate internet usage by public schools.
The e-rate will allow public schools a 50% discount on calls to access the internet as well
as internet access charges and any charges for receiving a signal via the internet.
2.22 Limitation on control of telecommunications services (section 53). In the
response to inputs by industry and to promote the provisions of section 2, the Authority
is obliged to provide regulations to promote consumer protection in the industry.
2.23 Universal Service Agency (sections 58). In order to ensure greater accountabil-ity,
the Bill provides that the Minister may appoint a seven-member board to provide
oversight of and guidance to the Fund.
2.24 Universal Service Fund (sections 65 to 67). The Bill seeks to minimise
institutional overlap in the management of universal service by bringing the Agency
directly under the control of the Minister, and eliminating the role of ICASA in relation
to universal service.
The Bill expands the causes for which the Universal Service Fund may be used to
include the facilitation of internet usage by public schools, the establishment of
telecentres and public information terminals, and to assist under-service area licensees
in the provision of infrastructure in under serviced areas.
The Bill limits the maximum contribution of a licensee to the Universal Service Fund
to 0.5% of its turnover. This measure will provide certainty to the telecommunications
industry in relation to its future contributions.
The Bill also provides that the Agency may award universal access projects by
competitive tender to bidders.
2.25 112 Emergency Centres (sections 78 to 81). The Bill empowers the Minister to
establish 112 Emergency Centres that will enable end users to be connected to
appropriate emergency organisations through dialing a dedicated number, ‘‘ 112’’ .112
Emergency Centres will be linked via a national radio network and may use state of the
art technology.
The Bill repeals the National Emergency Telephone Service Act, 1993 and
consolidates measures related to emergency telecommunications into the Act.
2.26 Directory services (section 89B). In recognition of the managed liberalisation of
the telecommunications industry, the Bill empowers ICASA to prescribe regulations
appropriate for directory services in a post-exclusivity environment.
2.27 Regulations (section 96). In recognition of ICASA’s need to act swiftly in the
fast changing telecommunications environment, the Bill reduces the public notice
period for draft regulations to 30 days.
With the advent of liberalisation, the Bill expressly tasks ICASA to give due regards
to the need for fair competition in the telecommunications industry when it prescribes
regulations.
2.28 Museum (section 96A). The Bill allows the establishment of a telecommunica-tions
museum, which depicts the history and evolution of the telecommunications sector
in South Africa. The contents of the Museum are to be regarded as a national asset in
terms of the National Heritage Resources Act, 1999 (Act No. 25 of 1999).
3. CONSULTATION
All major stakeholders in the telecommunications industry participated in or
contributed to the national policy colloquium in February 2001. In addition, the
Department of Public Enterprises and the Telkom IPO office have commented on the
Bill.
28.4. FINANCIAL IMPLICATIONS FOR STATE
The Bill has no direct financial implications for the State, but is expected to increase
the State’s proceeds from the Telkom IPO.
5. PARLIAMENTARY PROCEDURE
The Department of Communications and the State Law Advisers are of the view that
this Bill must be dealt with in accordance with the procedure established by section 75
of the Constitution since it contains no provision to which the procedure set out is
section 74 or 76 of the Constitution applies.
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