The South African Chapter of the Internet Society ISOC-ZAZ

Written Submission on the Telecommunications Amendment Bill
ISOC-ZA, the South African Chapter of the Internet Society, has pleasure in taking the opportunity to contribute to the legislative process by commenting on the proposed amendments to the 1996 Telecommunications Act, as amended.

About ISOC
The Internet Society http://www.isoc.org is a non-profit, non-governmental, open membership organization whose worldwide individual and organization members make up a veritable "who's who" of the Internet industry. It provides leadership in technical and operational standards, policy issues, and education. ISOC hosts two annual Internet conferences <http://www.isocorg/isoc/conferences/>, trains people from all over the world in networking technologies, conducts workshops for educators, and publishes an award-winning magazine, OnThelnternet.

ISOC provides an international forum to address the most important economic, political, social, ethical and legal initiatives influencing the evolution of the Internet. This includes facilitating discussions on key policy decisions such as taxation, copyright protection, privacy and confidentiality, and initiatives towards self-governance of the Internet. ISOC created the Internet Societal Task Force as an ongoing forum for discussion, debate, and development of position papers, white papers, and statements on Internet related societal issues.

ISOC is the organizational home of the International Engineering Task Force, the Internet Architecture Board, the Internet Engineering Steering Group, and the Internet Research Task Force - the standards setting and research arms of the Internet community. These organizations operate in an environment of bottom-up consensus building made possible through the participation of thousands of people from throughout the world.

ISOC has Chapters in countries around the world. The South African Chapter, ISOCZA, can be found at httn:I/www.isoc.org.za

Objectives of the Bill
We take the objectives of this Bill to be the following: -
A. To make provision for a Second National PSTN Operator (SNO)
B. To make provision for a third National Cellular Operator (Cell-C)
C. To make provision for a third international carrier, via Sentech
D. To assist in the provision of universal service by encouraging SMEEs to provide PSTN services in under-serviced areas
E. To encourage the widespread adoption of Internet technology by making provision for a reduction in rates for schools
F To clarify those areas of the existing Act where definitions and clauses are not clear and to reduce litigation and uncertainty in interpretation of the Act.

In the main, these objectives have been met, with the glaring exception of the last item. However, it would seem that the drafters of this Bill had additional objectives, which are not part of the objectives listed above and agreed to in public forums such as the February 2001 Telecommunications Policy Colloquium. The inclusion of this additional agenda has resulted in what we believe to be a dangerously flawed Bill, which if it were to be passed in its present form, would have serious and possibly unintended consequences to the South African economy and is in direct contradiction to the objectives of the Electronic Communications and Transactions Bill, also currently in the drafting process.

General Observations
1The independent Regulator, ICASA, has held a multitude of public hearings on a number of subjects, and has issued subsequent rulings, with the intention of clarifying uncertainties in the existing Act. One example is in the definition of, and requirements for regulation if any, of Virtual Private Networks (VPNs). The drafters of this Bill have ignored all this extremely valuable work. Indeed, in come cases, workable definitions have been replaced by definitions that are patently wrong.
2 In many cases, decisions by ICASA have been replaced by decisions by the Minister of Communications. This erodes the independence of the independent Regulator to no benefit to the country or the economy.
3 A number of existing requirements for public hearings by ICASA have been deleted and where these are still allowed, open hearings are prohibited. This cannot contribute to an open and transparent democracy, as South Africa is justifiably proud to claim.
4 We believe that the current restrictions on the use of VoIP are unclear, unnecessary and unenforceable.

Specific Observations
For the sake of clarity, these observations reference the clause numbers in the existing Act, or the amended Act, as the case may be.

1 S 32(1)(a) Surely the SMMEs referred to in 540A should also be holders of a PSTS licence if they are actually to provide facilities-based services in
under served areas.
2 5 32C Sentech is granted a fairly well defined license to act as a "Carrier of carriers", by which we take it that ISPs, VANS and other resellers of services will be able to make use of their services. However, they are also granted a licence for "a multimedia service". The definition of this service is extraordinarily wide and the granting of the license adds no restrictions to whom the service may be supplied. There is a very real danger that if Sentech is granted a license for specific services that this may be interpreted as an exclusive license for Sentech. The existing definition of "multimedia service" includes text, data, graphics, animation, audio and video on demand. All of these services are currently available from any suitably configured web site over the Internet anywhere in the world. It is surely not the intention of the drafters of this Bill to provide an exclusive license to Sentech for web site hosting? That would certainly spell the death knell for the growth of the Internet in South Africa.
3 5 36A. The definition of the services included in a PSTS licence is far too wide. Paragraph (b) should refer only to international telecommunications carrier services, otherwise it will include all first tier ISPs in SA. Paragraph (g) implies that a supplier of customer premises equipment requires a PSTS license. Is this really intended to include all manufacturers and suppliers of PABX equipment, for example? One can buy a telephone at the local supermarket. Does the supermarket require a PSTS license if a customer also has a subscription for a debit card from them, or buys the telephone under a credit arrangement? Paragraph (h)(vii) makes the erroneous assumption that Telkom is currently in possession of a license exempting it from the VoIP restrictions in the Act.
4 5 40. Why on earth are the words "value added network" replaced by the (undefined) term "electronic transaction"? How can a VANS licensee not have a licence to operate a VANS? Do the drafters of this Bill seriously mean to imply that any web site that offers e-commerce (a reasonable definition of electronic transaction in at least some cases) will require a VANS license? Will every bank that offers Internet Banking also require a VANS license? If this clause is passed as it stands, we might as well tear up the ECT Bill, as there will be no meaningful e-commerce in SA at all.
5 40A. Paragraph (3) should read: "An under-serviced area licensee shall provide telecommunication services and I or facilities ...", or else it may have significant difficulty in providing any services at all.
6 5 44. A specific prohibition of "Self Help" is required here. The existing situation where the PSTS licensee is Judge, Jury and Executioner is untenable. Furthermore, provision should be made for the customer to be free to change telecommunications facilities as required.
7 5 45. Not only calls should be discounted but also leasing costs of the carrier service. We note that the term "ISP" is used in this Clause, without definition.
8 We have two Chapter Xs?

The time made available for written submissions on this Bill has been woefully inadequate, and we are afraid that we are unable to do justice to the many important issues in the time available. We therefore request an invitation to make an oral submission at the appropriate time.

William Stucke
Chairman, ISOC-ZA
For and on behalf of the South African Chapter of the Internet Society.