Good morning ladies and gentlemen. I am Councillor Thabo Makhakhe and it is my honour to address you all today. I welcome you all, licensees, members of the media, members of the public and my Independent Communications Authority of South Africa (ICASA) colleagues who are here this morning.
The purpose of this briefing session is to provide an outline of how the authority intends to implement the provisions of chapter 10 of the Electronic Communications Act (ECA), No 36 of 2005. The chapter requires
ICASA to implement pro-competitive terms and conditions such as price controls on operators found to possess significant market power in markets characterised by ineffective competition. I will take a few questions at the end of this statement.
Setting the scene
The Electronic Communications Act is a component of the South African government’s policy to enhance both dynamic and distributive efficiency in the management of communications resources within the South African economy. The act makes specific provision for ex ante pro-competitive regulation where market failure exists and competition is deemed to be ineffective.
In 2006, the authority initiated a review of the call termination market that culminated in a findings document released at the end of 2007.
The numerous written as well as oral submissions received by the authority on the discussion document on the call termination market and on draft regulations published in 2008 brought to bear the need for a guideline outlining the authority’s approach in implementing chapter 10 of the act.
The comments in these submissions ranged from different legal interpretations to detailed comments on how best to evaluate indicators of the effectiveness of competition, such as countervailing bargaining power and the economies of scale and scope.
Based on a review of the submissions made by stakeholders, engagement with the Competition Commission and a review of international best-practice, the authority has developed a guideline to provide clarity on how the Authority will conduct market reviews. This guideline represents a roadmap on the way forward in handling the market reviews process.
The guideline
The aim of the guideline is not to prescribe any action but to outline the process the Authority plans to follow in determining the need for regulation with a view to correct market failure where it exists. The guideline includes the following:
* The public consultation process to be followed
* An outline of the aspects to be considered when identifying the need for regulation
* An indication of the type of information which the Authority might or
will require when conducting investigations into the effectiveness of competition in the information and communication technology (ICT) sector.
In particular, the authority wishes to inform all stakeholders that; regulations defining relevant markets, assessing the effectiveness if competition in those markets, identifying operators with significant market power and imposing pro-competitive terms and conditions will be developed on a market by market basis as an outcome of a market review.
Conclusion
To licensees, I ask that you take note of section four (information needs) of the guide and start preparing your data systems such that we can work together to efficiently achieve the mandate of the ECA.
In conclusion, we wish to thank all those who provided comment during the consultation phase of this complicated process.
Issued by: Independent Communications Authority of South Africa
8 March 2010
Source: Independent Communications Authority of South Africa (http://www.icasa.org.za/)
