ICASA General Licence Fees Regulations 2012

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[9 August 2014]

The Independent Communications Authority of South Africa (ICASA) has released a long-awaited document explaining their reasoning behind the 2012 General Licence Fee Regulations and the 2014 Amendment. This comes after industry criticism, particularly regarding the recent amendment, with at least one formal request for justification under the Promotion of Administrative Justice Act.

However, the explanation fails to satisfy. What should have been a clear process remains complex, and the 2014 Amendment arguably worsens the situation. In our view, the document defends raising license fees as a way to address ICASA’s own shortcomings in regulating them, which is a weak justification.

Reasons Document General Licence Fees Regulations 2012

[5 April 2014]

ICASA General Licence Fees Amendment Regulations, 2014

While the Independent Communications Authority of South Africa (ICASA) has published final amendments to the General Licence Fees Regulations, critics argue these adjustments fall short of addressing the broader issues. Many believe the modifications offer minimal clarity for licensees and do little to streamline ICASA’s process for calculating and collecting annual fees.

The sole amendment effected is to the definition of “Licensed Services”:

Previous definition:

“Licensed Service” as defined in the Electronic Communications Act under “broadcasting service”, “electronic communications service” and “electronic communications network service”; and as contained in the relevant licence and does not include the resale of electronic communications services, service provider discounts, agency fees, interconnection and facilities leasing charges, and government grants and subsidies;

New definition:

“Licensed Service‘ as defined in the Electronic Communications Act under “broadcasting service”, “electronic communications service” and “electronic communications network service”, and as contained in the relevant licence.

[28 February 2014]

The definition of “licensed services” in the General Licence Fees Regulations 2014 has caused some confusion. To address this, a draft amendment has been released for public comment.

This amendment aims to clarify which revenue should be included and excluded when calculating service license fees.

Public comments are due by Monday, March 10th, 2014.

Draft Amendment to General Licence Fee Regulations Feb 2014

The Independent Communications Authority of South Africa (ICASA) has revamped its licensing fee system for electronic communications and commercial broadcasting companies. The new regulations, titled “ICASA General Licence Fees Regulations 2012,” will take effect on April 1st, 2013.

These regulations outline how annual licensing fees will be calculated and introduce updated costs for administrative processes like license applications, amendments, and similar services.

Revision of the licence fee regime

General Licence Fees Regulations 2012

Formula:

  • Pa = Payable Annual licence Fee
  • R = Revenue from licensed services
  • B = applicable percentage per table below dependent on license revenue in accordance with this schedule read with regulation 3(1).
  • Pa = R x B

License Revenue (R) (Rand)

Percentage applied (B) (%)

0-50 000 000

0.15

50 000 001 – 100 000 000

0.20

100 000 001 – 500 000 000

0.25

500 000 001 – 1 000 000 000

0.30

1 000 000 001 +

0.35

Licensed Service:

The term “Licensed Service” refers to:

  • Broadcasting services
  • Electronic communications services
  • Electronic communications network services

These are as defined in the Electronic Communications Act and further specified in your specific license. It’s important to note that “Licensed Service” excludes:

  • Resale of electronic communication services
  • Discounts offered by service providers
  • Agency fees
  • Interconnection and facilities leasing charges
  • Government grants and subsidies

Revenue:

“Revenue” refers to the income you disclose in your audited Annual Financial Statements according to International Accounting Standard 18. This means the total income you generate from your regular business activities that increases your equity (ownership stake) in the company. It excludes any additional investments made by owners.

If you don’t pay your annual license fees, the Authority will suspend your license (issued under Chapter 3 of the Act) until you settle the fees and any interest charges in full.

Licensees with financial submissions due prior to April 1, 2014, should be aware that the calculation method for ALF has undergone periodic revisions. A historical record of these changes is provided below.

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