Starlink Awaits South Africa License Amid Policy Shifts

Starlink, the satellite internet provider owned by Elon Musk, has reiterated its commitment to adhering to South Africa's local laws amidst ongoing challenges with obtaining an operating license. The company has been navigating through regulatory hurdles, particularly those related to the country's black empowerment laws, which require foreign companies to divest 30% of their equity to historically disadvantaged persons.

In a letter addressed to South Africa’s Trade, Industry, and Competition Minister, Ryan Goodnight, the senior director of market access at Starlink, emphasized the company's dedication to investing in the country. Goodnight clarified that Starlink has never sought an exemption from the broad-based black economic empowerment (B-BBEE) rules and has not requested any special treatment. The company supports a level playing field for the entire sector, not just specific operators.

Starlink's launch in South Africa has been delayed due to licensing regulations set by the communications regulator, which mandate that all license holders must be 30% locally owned. Goodnight explained that as a global system, Starlink must retain sole ownership of all its subsidiaries for operational purposes, a requirement that applies across nearly 150 countries and territories where the service is provided.

Goodnight also highlighted that the Electronic Communications Act and the B-BBEE ICT sector code already provide alternative provisions to meet ownership requirements, including through equity equivalent investment programmes (EEIPs). These programmes are ongoing in various industries and could serve as a viable solution for Starlink's entry into the South African market.

Communications Minister Solly Malatsi has proposed amending the rules to allow foreign companies like Starlink to enter South Africa without sharing ownership. The proposed plan includes an "equity equivalent" scheme, where companies can invest in areas such as education and skills development instead of divesting equity. This policy direction aims to align Icasa’s licensing regulations with the B-BBEE ICT sector code, addressing the current misalignment.

If Icasa allows companies to utilize EEIPs as envisioned by the B-BBEE Act, Starlink would immediately apply for the necessary licenses in South Africa. The company aims to provide high-speed internet service across the country, with a particular focus on rural areas where broadband networks are currently lacking. Goodnight emphasized that millions of children are being denied access to educational resources due to the limited reach of South African broadband networks, a problem Starlink is eager to help solve.

Under the equity equivalent scheme, Starlink has committed to providing 5,000 rural schools with fully funded Starlink kits and service, along with the necessary support. The company has also appealed to South Africans who have registered their interest in the service to support the communications minister’s equity equivalents policy direction for the ICT sector.

While the launch of Starlink in South Africa remains on hold, the service has expanded its footprint in Africa by launching in the Democratic Republic of Congo, bringing the total number of countries in Africa where Starlink is available to 22.