ICASA publishes draft Signal Distribution Services Regulations, 2025

The stated purpose of the draft regulations is to, inter alia,-

1. define the relevant wholesale markets for the provision of terrestrial signal distribution services ("the affected sectors");
2. determine whether there is effective competition within the defined markets;
3. determine which, if any, licensees had significant market power in the defined markets;
4. determine whether there is any market failure;
5. impose pro-competitive license conditions on licensees with significant market power to remedy the market failure; and
6. provide for monitoring and investigation of anti-competitive behaviour in the defined markets

ICASA identified and defined the following markets for services provided in South Africa:

• the wholesale terrestrial signal distribution for television broadcasting services;
• the wholesale terrestrial signal distribution for FM sound broadcasting services; and
• the wholesale terrestrial signal distribution for AM sound broadcasting services.

ICASA also determined that Sentech SOC Limited ("Sentech") had significant market power in all three of the defined markets and that market failures existed.

To address the above market failures, ICASA proposes to impose the following pro-competitive terms and conditions that Sentech must comply with:

• Sentech must ensure that all tariffs for terrestrial signal distribution services are reasonably cost-based, allowing for recovery of direct costs, the appropriate share of common costs related to the product, a return on capital employed. The aforesaid costs should not include any costs related to other services and products provided by the SMP operator;
• Sentech must submit a Reference Offer in relation to network access and the provision of terrestrial signal distribution services for approval by ICASA, which should include terms and conditions, customer obligations and restrictions, service descriptions, charges, terms of payment and billing procedures, measurable quality of service and service level guarantees, and dispute resolution procedures.
• Lastly, Sentech must publish the approved Reference Officer on its website within 14 days of approval.

ICASA also proposes that Sentech must, on request, provide a detailed information on tariffs, cost allocation methodologies, asset valuation, return on investment assumptions, and cross-subsidisation practices in relation to the defined markets. Should ICASA find that this information does not justify the current prices, it would be entitled to enforce a pricing remedy on Sentech.

Interested persons are invited to make written representations on the draft regulations and to submit the representations to ICASA within 30 working days, i.e. by 20 June 2025.