EFF Insists Elon Musk’
By Karabo Marifi
The Economic Freedom Fighters (EFF) have asserted that Elon Musk’s satellite company, Starlink, must comply with South Africa’s Black Economic Empowerment (BEE) laws if it wants to operate in the country. This comes after Starlink’s parent company, SpaceX, urged the Independent Communications Authority of South Africa (ICASA) to reconsider its 30% local ownership requirement for foreign satellite operators.
Starlink’s Request to Bypass BEE Regulations Rejected
Starlink, which is owned by Musk’s US-based SpaceX, has been seeking entry into the South African market. However, under current B-BBEE (Broad-Based Black Economic Empowerment) regulations, any satellite communications company operating in South Africa must have at least 30% ownership by historically disadvantaged groups. SpaceX formally requested ICASA to rethink its foreign licensing rules, arguing that they pose a barrier to international operators.
Speaking at a media briefing on Monday, EFF leader Julius Malema dismissed the idea of making an exception for Musk’s company, insisting that the country’s BEE policies must be implemented consistently.
“BEE, Broad-Based Black Economic Empowerment, is a policy that should be implemented whether there is Elon Musk involved or not—it must not be a policy for certain people and a policy for other people. Whatever Elon Musk wants to come and do here, they must make sure there is participation of the previously disadvantaged people. Black people must participate in that transaction.”
Parliament’s Communications Committee Echoes the Stance
Malema’s position aligns with that of the Parliamentary Communications Committee, which has also made it clear that Starlink must comply with local regulations. Committee chairperson Khusela Diko emphasised that South Africa will not bend the rules for any company, no matter how influential.
“Countries do have laws, and in South Africa, we have BEE legislation which says in the specific sector this company wants to operate in, there shall be a 30% BEE [requirement].”
Diko compared the situation to the United States’ stance on foreign tech companies, highlighting that even the US imposed ownership conditions on foreign firms. She cited former President Donald Trump’s order that TikTok must be at least 50% owned by US citizens if it wanted to continue operating in America.
ICASA’s Public Hearings on Satellite Regulations
ICASA, which regulates the telecommunications sector in South Africa, is holding public hearings this week in Centurion to discuss a new licensing framework for satellite services. The hearings will address concerns raised by foreign satellite operators, including Starlink and Meta (Facebook’s parent company), about the feasibility of complying with local ownership laws.
During the hearings, representatives from SpaceX are expected to argue that the 30% BEE requirement is too restrictive and may prevent Starlink from entering the South African market. (ICASA)
Why Is Starlink Struggling to Enter South Africa?
- Local Ownership Rules
The main obstacle preventing Starlink from operating in South Africa is the requirement that 30% of a telecoms company must be owned by historically disadvantaged South Africans. SpaceX has global policies that prevent local shareholding, making it difficult for the company to meet ICASA’s licensing conditions.
- BEE Laws in Telecommunications
South Africa’s B-BBEE policies were designed to redress historical inequalities caused by apartheid by ensuring that previously disadvantaged groups have a stake in major industries. The telecommunications sector, being a critical part of the economy, has strict regulations ensuring local ownership and participation.
- Global vs. Local Business Models
Starlink operates differently from traditional telecom providers. Instead of relying on local infrastructure, it provides high-speed internet through a network of low-earth orbit satellites. Because of this global business model, the company argues that it should not be required to hand over local ownership stakes to comply with South African law.
Arguments for and Against BEE Compliance in the Starlink Case
Arguments Supporting BEE Compliance
1. Fairness in Regulation – Other telecommunications companies operating in South Africa must comply with BEE rules. Giving Starlink special treatment would set a double standard.
2. Economic Empowerment – The BEE policy is designed to empower black South Africans, ensuring they benefit from foreign investments in the local economy.
3. Strengthening Local Businesses – If Starlink partners with local telecoms firms, it could create new jobs and business opportunities.
Arguments Against BEE Compliance for Starlink
1. Restricting Innovation – Critics argue that BEE rules may prevent South Africa from accessing advanced technology, especially in rural areas where Starlink’s satellite internet could provide a solution.
2. Investment Barriers – Some believe that the 30% local ownership rule discourages foreign companies from investing in South Africa.
3. Different Business Model – Starlink does not require local partners to operate, making the ownership requirement seem unnecessary.
What Happens Next?
• ICASA will continue public hearings this week, where SpaceX representatives will argue their case.
• The South African government will decide whether to amend BEE laws for international satellite providers or maintain the 30% local ownership requirement.
• If Starlink fails to comply with BEE rules, it may abandon its plans to operate in South Africa, as it has already done in other countries where local ownership was required.
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