GUGU LOURIE: Silence over rulings risks making Icasa irrelevant

The Independent Communications Authority of SA (Icasa) has long been the watchdog of the country’s telecommunications, broadcasting and postal industries. However, Icasa’s mute stance on rulings it makes has led to concerned entities having to take it upon themselves to announce the outcomes of the regulator’s adjudication. 

The regulator’s handling of the long-running Cell C licence transfer matter is a glaring example of how Icasa’s silence on its rulings risks making it irrelevant. Last week it emerged through the grapevine that Icasa had approved the transfer of Cell C’s spectrum and network licences to Blue Label Telecoms, a JSE-listed tech company. This would pave the way for Blue Label to take control of the struggling mobile operator, which has in effect been transforming into a super mobile virtual network operator. 

With Icasa silent on the matter, Blue Label’s share price surged 13.51% in the past week and 7.88% year to date. The share price appreciation suggests the market had already caught wind of the approval before it was officially announced by Icasa. Blue Label has since issued a statement confirming the approval,  and still Icasa remains conspicuously silent. 

No public notice. No media statement. No explanation — just silence. This is not just puzzling, it’s deeply concerning, especially considering that the regulator held public hearings on the matter in September last year. Why keep schtum about its ruling on the Cell C licence transfer to Blue Label? What is the regulator hiding? 

While Icasa has “informed” Blue Label about its decision to approve the licence transfer, it has selectively left other stakeholders in the dark. CellSaf, Cell C’s former BEE partner, the stake of which plunged from 40% to 1%, has not received any formal notice from Icasa. CellSaf company secretary Nomonde Mabuya expressed bewilderment at the situation, noting that Blue Label had already issued a JSE Sens announcement while CellSaf remained in the dark.

“What is even more strange is that Icasa held public hearings on this matter in September last year, and yet its findings are not public,” Mabuya said. 

This raises serious questions about Icasa’s commitment to transparency and fairness. If the regulator is willing to sideline a key stakeholder such as CellSaf, what does that say about its accountability to the public? 

On paper, Icasa is a critical institution responsible for the issuance of licences, compliance enforcement and management of the radio frequency spectrum. Its role is to act in the public interest, not to serve as a private messaging service for corporate entities such as Blue Label. 

One of the most critical issues at stake is whether Cell C meets the requirement of at least 30% ownership by historically disadvantaged individuals. This is a cornerstone of SA’s broad-based BEE policy. Yet Icasa has failed to provide clarity on this matter. 

During the public hearings I pressed Cell C and Blue Label on whether their complex BEE structures were merely fronts for TPC (The Prepaid Company), a subsidiary of Blue Label. The answers were evasive, and Icasa’s silence since then speaks volumes. 

Cell C’s recapitalisation efforts between 2017 and 2022 involved a web of special purpose vehicles (SPVs) that absorbed debt obligations in exchange for shares in the company. 

For instance, SPV4 is owned by Albanta Trading, a subsidiary of the Believe Trust established for the benefit of Cell C employees. Active directors of Albanta include Cell C executives Joseph Juba, Angelo Mashaba and Lehlomo Joshua Moela. Meanwhile, Cell C executives Brett Copans and Rachael Ayo-Oladejo are active directors of both SPV4 and SPV5. 

There is also M5, which remains a bit of a mystery — I could not establish who the directors are as it is not registered with the Companies & Intellectual Property Commission. Who controls these structures? Are they genuine empowerment vehicles or merely sophisticated fronts designed to mask a lack of real transformation? 

Icasa’s refusal to address these questions undermines its credibility as a regulator. The public hearings held last September were supposed to provide clarity and ensure accountability about the proposed licence transfer from Cell C to Blue Label. Instead, the hearings appears to have been little more than a box-ticking exercise. 

Blue Label and Cell C were not pressed to disclose critical information during the hearings. Instead, they were asked to submit written responses. Those responses, if they exist, remain hidden from public view. What was the point of holding public hearings if Icasa is going to operate in the shadows? This lack of transparency was not just an administrative failure; it was a betrayal of the public trust. 

Icasa’s mandate is to regulate in the public interest, not to act as a gatekeeper for corporate interests. By failing to communicate its decisions openly and transparently, the regulator is in effect abdicating its responsibility to the people of SA. 

The current state of Icasa is a far cry from its heyday under leaders such as Mandla Langa, who understood the importance of robust, transparent regulation. Icasa now seems more interested in maintaining a veneer of functionality than actually doing its job. Its silence on the Cell C licence transfer is just the latest example of a regulator that has lost its way and is headed for irrelevance. 

Industry stalwart Andile Ngcaba has argued that Icasa should either be shut down or transformed into a digital regulator. Given its current trajectory, it’s hard to disagree.

• Lourie is founder and editor of TechFinancials.