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43970 04-12 Icasa Government Gazette Staatskoerant REPUBLIC OF SOUTH AFRICA REPUBLIEK VAN SUID AFRIKA Regulation Gazette No. 10177 Regulasiekoerant December Vol. 666 4 2020 No. 43970 Desember PART 1 OF 2 ISSN 1682-5843 N.B. The Government Printing Works will 43970 not be held responsible for the quality of “Hard Copies” or “Electronic Files” submitted for publication purposes 9 771682 584003 AIDS HELPLINE: 0800-0123-22 Prevention is the cure 2 No. 43970 GOVERNMENT GAZETTE, 4 DECEMBER 2020 IMPORTANT NOTICE: THE GOVERNMENT PRINTING WORKS WILL NOT BE HELD RESPONSIBLE FOR ANY ERRORS THAT MIGHT OCCUR DUE TO THE SUBMISSION OF INCOMPLETE / INCORRECT / ILLEGIBLE COPY. NO FUTURE QUERIES WILL BE HANDLED IN CONNECTION WITH THE ABOVE. Contents Gazette Page No. No. No. GENERAL NOTICES • ALGEMENE KENNISGEWINGS Independent Communications Authority of South Africa/ Onafhanklike Kommunikasie-owerheid van Suid-Afrika 697 Electronic Communications Act (36/2005): Reasons document relating to the invitation to apply on the licensing process for International Mobile Telecommunications in respect of the provision of Mobile Telecommunications in respect of urban and rural areas using the Complimentary Bands, IMT700, IMT800, IMT2600 and IMT3500 ....... 43970 3 This gazette is also available free online at www.gpwonline.co.za STAATSKOERANT, 4 DESEMBER 2020 No. 43970 3 GENERAL NOTICES • ALGEMENE KENNISGEWINGS Independent Communications Authority of South Africa/ Onafhanklike Kommunikasie-owerheid van Suid-Afrika INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA NOTICE 697 OF 2020 697 Electronic Communications Act (36/2005): Reasons document relating to the invitation to apply on the licensing process for International Mobile Telecommunications in respect of the provision of Mobile Telecommunications in respect of urban and rural areas using the Complimentary Bands, IMT700, IMT800, IMT2600 and IMT3500 43970 I C A SA Independent Communications Authority of South Africa 350 Witch-Hazel Avenue, Eco Point Office Park Eco Park, Centurion. Private Bag X10, Highveld Park 0169 Telephone number: (012) 568 3000/1 REASONS DOCUMENT RELATING TO THE INVITATION TO APPLY ON THE LICENSING PROCESS FOR INTERNATIONAL MOBILE TELECOMMUNICATIONS IN RESPECT OF THE PROVISION OF MOBILE BROADBAND WIRELESS ACCESS SERVICES FOR URBAN AND RURAL AREAS USING THE COMPLIMENTARY BANDS, IMT700, IMT800, IMT2600 AND IMT3500 BACKGROUND On 1 November 2019, the Authority published an Information Memorandum (IM) aimed at outlining the Independent Communications Authority of South Africa’s (Authority) intended approach with regards to the licensing process for International Mobile Telecommunications (IMT) spectrum pursuant to consideration of the Policy on High Demand Spectrum and Policy Direction on the Licensing of a Wireless Open Access Network dated 26 July 2019. The Authority received fifty-three (53) written representations by the deadline of 31 January 2020. Four (4) additional written representations received after the deadline were not considered. The Authority did not hold public hearings since the Authority did not call for public hearings on the notice and the IM does not fall within the prescript of section 4 (6) of the Electronic Communications Act, 2005 (Act No.36 of 2005). The Authority conducted a Competition Assessment and Fair Valuation of Spectrum having considered and analysed the written representations. Furthermore, the Authority had considered the Policy on High Demand Spectrum and Policy Direction on the Licensing of a Wireless Open Access Network (WOAN) published on 26 July 2019 in Government Gazette Number 42597 (the Policy). This gazette is also available free online at www.gpwonline.co.za 4 No. 43970 GOVERNMENT GAZETTE, 4 DECEMBER 2020 Page 2 This reasons document is intended to outline the reasons for the decisions of the Authority with respect to the written representations received and the work that the Authority has done towards finalising the Invitation to Apply (ITA). It covers the legislative and regulatory framework, the analysis on the IM, the policy considerations, the Competition Assessment and Fair Valuation of the Spectrum Bands – IMT700, IMT800IMT800,, IMIMT2600,T2T260 and IMT3500. ___________________________________________ DR. KEABETSWE MODIMOENG CHAIRPERSON ICASA ICASA - Confidential This gazette is also available free online at www.gpwonline.co.za STAATSKOERANT, 4 DESEMBER 2020 No. 43970 5 Page 3 Table of Contents LEGISLATIVE AND REGULATORY FRAMEWORK ............................................ 6 1.2 The Constitution ............................................................................................................. 6 1.3 The ICASA Act ................................................................................................................ 7 1.4 The ECA ........................................................................................................................... 7 1.5 The Radio Frequency Spectrum Regulations, 2015 ................................................. 8 1.6 Radio Frequency Migration Regulations 2013 and Radio Frequency Migration Plan 2019 .................................................................................................................................. 9 1.7 IMT Roadmap ............................................................................................................... 10 1.8 Terrestrial Broadcasting Frequency Plan ................................................................. 11 1.9 Ministerial Policies and Policy Directions ................................................................. 12 INFORMATION MEMORANDUM REPRESENTATIONS .............................................. 13 OBJECTIVES .................................................................................................... 14 LEGAL FRAMEWORK ......................................................................................... 16 PROPOSED SPECTRUM FOR THE AWARD .............................................................20 SPECTRUM OBLIGATIONS ................................................................................. 37 MVNO ....................................................................................................................................... 42 30% OFFTAKE ........................................................................................................................ 44 EMPOWERMENT PROVISIONS ............................................................................................. 48 UNDERSERVICED AREAS ...................................................................................................... 50 SOCIAL OBLIGATION ............................................................................................................ 54 CAPACITY ............................................................................................................................... 5 5 THE AWARD PROCESS ...................................................................................... 56 AUCTION ......................................................................................................... 57 GENERAL COMMENTS ....................................................................................... 59 WOAN ............................................................................................................. 63 TIMING ........................................................................................................... 65 RECOMMENDATIONS FROM THE IM SUBMISSIONS ............................................... 66 RESERVE PRICES FOR THE AUCTION .................................................................. 67 CONSIDERATION OF THE POLICY ON HIGH DEMAND SPECTRUM AND POLICY DIRECTION ON THE LICENSING OF A WIRELESS OPEN ACCESS NETWORK ON 26 JULY 2019 IN THE GOVERNMENT GAZETTE NO. 42597 (“the Policy”)....................................................................................................................... 70 Overview ......................................................................................................... 80 Competition pre-auction .................................................................................... 82 ICASA - Confidential This gazette is also available free online at www.gpwonline.co.za 6 No. 43970 GOVERNMENT GAZETTE, 4 DECEMBER 2020 Page 4 Barriers to entry ............................................................................................... 82 Retail and wholesale market shares and market power ......................................... 82 Retail price and access outcomes ....................................................................... 89 Spectrum assignments pre-auction ..................................................................... 93 Competition post-auction ..................................................................................97 Overview ......................................................................................................... 97 Credibility ...................................................................................................... 101 Framework for how dimensions of quality can affect credibility ............................. 102 Assessment of economic evidence in support of a policy to promote at least four (+ one) national wholesalers ................................................................................ 105 Overview of the approach to analysing the Competition concerns ......................... 109 Competition Assessment: future retail competition ............................................
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