The country's communications regulator has published two practice notes in the Government Gazette, which seeks to clarify the interaction between its recently published interconnect regulations and the call termination rate regulations.
The practice notes address how the regulations will be implemented, including possible scenarios and key considerations.
However, Kathleen Rice, director at the TMT Practice, at Cliffe Dekker Hofmeyr law firm, explains that practice notes are not considered binding and may not deviate from the enabling legislation.
Rice explains that, by way of the practice notes, the Independent Communications Authority of SA (ICASA) will miss the deadlines it has set in its regulations and would in effect be condoning non-compliance with the regulations.
She explains that as it stands, the interconnection regulations require that all licensees party to interconnection agreements, concluded prior to 1 January 2007, submit (or resubmit if they have previously been submitted) these interconnection agreements to ICASA for review. Licensees party to interconnection agreements concluded after 1 January 2007 have until 30 June 2011 to submit these agreements to ICASA.
However, Rice explains that the termination rate regulations require that the "big three" - MTN, Vodacom and Telkom - all develop reference interconnect offers (RIOs) which must comply with the interconnection and termination rate regulations.
“The RIOs are meant to contain the standard terms and conditions that will apply to all agreements concluded with the big three. The rationale is that the RIOs will streamline the interconnection agreement negotiation process, making it easier and quicker for licensees who do not have countervailing bargaining power to conclude interconnection agreements with any one of the big three,” she notes.
Rice points out that MTN, Vodacom and Telkom have not yet had their RIOs approved by ICASA. The RIOs ought to have been submitted to and approved by ICASA by no later than 13 January in terms of the termination rate regulations.
As a result, ICASA's practice notes effectively condone non-compliance with its own termination rate regulations and waive compliance with its interconnection regulations.
Implementing asymmetry
According to the second practice note, regarding the implementation of asymmetric rates, licensees providing termination services at a fixed location are entitled to charge up to 20% more than Telkom, and licensees providing termination services at a mobile location are entitled to charge up to 20% more than MTN and Vodacom.
Rice says ICASA has not given any indication of whether all other licensees will be able to charge up until the full maximum asymmetrical rate and presumably this will be a matter for commercial negotiation.
“If interconnecting parties are unable to agree on the exact percentage mark-up, ICASA can be formally called upon to resolve the dispute in terms of the Electronic Communications Act. The big three can be expected to resist the notion that all other licensees are automatically entitled to maximum asymmetrical rate, so ICASA may have some tricky disputes referred to it.
“That having been said, ICASA has stated it has 'no intention of determining wholesale call termination rates per licensee'. It seems, therefore, that ICASA will accept as being fair and reasonable any termination rate up to the maximum specified rate per market, provided the interconnection provider concerned is not discriminating against interconnection seekers,” she says.
Rice adds it is made clear in ICASA's practice note on the implementation of the asymmetry provisions of the termination rate regulations that it will not be necessary for any non-big three licensees to apply to ICASA to charge an asymmetrical rate.
“It seems that any licensee who had a share of less than 25% of total terminated minutes in the relevant fixed or mobile termination market as of June 2009 is automatically entitled to an asymmetrical rate,” she concludes.
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