Starlink Faces Two-Year Delay in South Africa Due to BEE Regulations

Starlink's ambitious plans to provide high-speed satellite internet in South Africa have encountered a significant obstacle. According to ICT regulatory expert Dominic Cull, the process of securing a license to operate in the country may take at least two years due to the complex Black Economic Empowerment (BEE) regulations. These regulations require that 30% of a licensee’s equity be held by historically disadvantaged persons, a stipulation that poses a challenge for global companies like Starlink, which seeks to retain full ownership of its subsidiaries for operational reasons.

Cull, speaking at the Wapaloza 2025 conference, highlighted the slow pace of regulatory reform in South Africa. He emphasized that it typically takes a minimum of five years to develop a piece of legislation and another three years to translate that into a regulatory framework. This excruciating pace of legislative change has dashed hopes for a swift rollout of Starlink in South Africa. Cull predicted that even an optimistic timeline for new equity equivalence investment programmes (EEIPs) would push the satellite internet provider’s licensing to late 2027.

Communications Minister Solly Malatsi has proposed EEIPs as an alternative to the 30% equity rule, allowing companies to invest in areas like education or small Black-owned businesses instead of relinquishing shares. This draft policy, issued in May 2025, aims to ease entry for foreign investors like Starlink. However, the proposal has sparked controversy. Khusela Diko, chair of parliament’s communications portfolio, accused Malatsi of creating a “shortcut” for the Musk-owned company, a claim he denies. Diko argued that other satellite operators have complied with existing BEE laws, questioning why Starlink should receive special treatment. This political friction underscores the broader tension between economic transformation goals and attracting global investment.

Despite the hurdles, Starlink remains eager to enter the South African market. In a letter to Trade, Industry & Competition Minister Parks Tau, the company refuted claims that it seeks exemptions from BEE laws. Ryan Goodnight, Starlink’s senior director of market access, stated, “We are fully committed to providing the service as a legally compliant company, as we do all around the world.” The company has proposed a R500-million ($27 million) investment to provide free Starlink kits and services to 5,000 rural schools, potentially benefiting 2.4 million students. This initiative highlights its potential to bridge South Africa’s digital divide, where internet penetration stands at 70% but rural areas often lack reliable connectivity.

The delay in Starlink’s launch has significant implications for South Africa. The country risks falling behind its neighbors, as all other Southern African Development Community (SADC) nations are set to welcome the company by the end of the year. Lesotho, for instance, recently launched the service, with plans for AI-powered data centers and community internet hotspots. The absence of Starlink could hinder efforts to expand broadband access in remote regions, where fiber and mobile networks are often uneconomical. Moreover, astronomers have raised concerns about Starlink’s satellites interfering with South Africa’s Square Kilometre Array (SKA) telescope, adding another layer of complexity to licensing discussions.

The delays and saga have also fueled political debates. EFF leader Julius Malema vowed that the company would not operate in South Africa unless it complies with BEE laws, reflecting strong resistance from some quarters. Meanwhile, Elon Musk’s controversial claim that the firm was barred “because I’m not Black” drew sharp rebukes, with critics clarifying that the issue lies in regulatory compliance, not race. South African billionaire Johann Rupert, during a White House visit in June 2025, underscored Starlink’s potential to combat crime through enhanced connectivity, amplifying the stakes of the debate.

Globally, Starlink has transformed internet access in over 140 markets, offering median download speeds above 100 Mbit/s in 14 countries. In Africa, about 24 countries have embraced the service, though oversubscription has led to “sold out” statuses in some urban centers. South Africa’s robust fiber and mobile networks may mitigate such congestion, but rural communities stand to benefit most from Starlink’s satellite internet. For comparison, Zambia offers Starlink’s standard plan at R666/month, significantly cheaper than the U.S.’s R1,604. This affordability could make the service a viable option for South Africans, provided regulatory barriers are overcome.

The road to Starlink South Africa remains fraught with challenges. While Malatsi’s EEIP proposal offers hope, the slow pace of regulatory reform and political pushback suggest a lengthy wait. Cull’s warning that “Starlink perhaps is not taking into account just how slowly things move here” rings true, as South Africa balances economic transformation with global innovation. For now, South Africans eager for Starlink’s high-speed internet must wait, while rural communities miss out on connectivity that could transform education, business, and security.