US embassy cable - 05PRETORIA424

UNCLAS PRETORIA 000424 
 
SIPDIS 
 
DEPT FOR AF/EPS, AF/S/TCRAIG AND KGAITHER, AND EB/CIP 
COMMERCE FOR 4510/ITA/IEP/ANESA/OA/JDIEMOND 
TREASURY FOR GCHRISTOPULOS, LSTURM, AND AJEWEL 
DEPT PASS USTR FOR PCOLEMAN, WJACKSON AND CHAMILTON 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ECPS, ETRD, ECON, EINT, SF 
SUBJECT:  MINISTER ADDRESSES QUESTIONS SURROUNDING VANS 
REGULATIONS 
 
REFTEL:   A) PRETORIA 389 
 
          B) 04 PRETORIA 5555 
 
(U) Sensitive but unclassified.  Not for Internet 
distribution.  Please protect accordingly. 
 
1. (U) Minister of Communications Ivy Matsepe-Casaburri 
released a January 30 statement addressing concerns 
surrounding the interpretation of her Ministerial 
Determinations that she released September 3, 2004 regarding 
liberalization. 
 
2.  (U) Casaburri said, "The issue of self provisioning was 
issued in the government's policy determinations only in 
relation to mobile cellular operators in terms of fixed 
links."  She continued that value-added network service 
(VANS) providers could obtain facilities from "any licensed 
operator."  While Casaburri used the same language in her 
"clarification" that she used in the original Ministerial 
Determination, industry analysts understand this to mean 
that VANS will not be allowed to self-provide their own 
infrastructure and will need to procure facilities from a 
licensed operator such as Telkom, the mobile operators, 
Transtel, and others.  Although this is a victory for 
incumbents who argued that VANS could not self-provide, it 
likely avoids litigation on the subject that would have 
delayed implementation of the remaining benefits to VANS. 
 
3.  (U) The Minister also said that government did not 
intend "to license every single activity that can be 
provided by a VANS operator," apparently in response to 
industry requests for greater detail on what a VANS provider 
is and what VANS services would require licenses.  Casaburri 
promised that the imminent Convergence Bill would provide 
certainty to the sector in this regard. 
 
4.  (SBU) COMMENT.  Industry observers are puzzled by the 
chronology of these events.  That the Minister would 
implement Ministerial Determinations to liberalize certain 
telecommunications services just weeks prior to the release 
of Convergence legislation establishing a more liberal 
legislative and regulatory framework is akin to putting the 
cart before the donkey.  In issuing her clarifying 
statement, the Minister did so "against the imperative to 
avoid any delays" and "within the context of regulatory lag" 
in the event of an amendment to the Telecommunications Act, 
leading industry observers to speculate about possible 
delays in the February 1 implementation of her Ministerial 
Determinations.  END COMMENT. 
 
FRAZER