ICASA has extended the deadline for submission of responses to the 2016 Call Termination Market Info Questionnaire to 24 March 2017.
A briefing session to clarify queries relating to the process to be undertaken will be held at ICASA Head Office on 24 March 2017 from 10h00 to 13h00.
___[10 February 2017] The request for information for the review has been gazetted and can be found below.
[30 January 2017] ICASA has given notice of its intention to commence with a review of the pro-competitive terms and conditions imposed on licensees in respect of rates charged for the termination of voice calls.
The first step in the review is for licensees to complete and submit a questionnaire by no later than 16h00 on 28 February 2017. Completed questionnaires should be sent to firstname.lastname@example.org.
Licensees have until 16h00 on 13 February 2017 to submit any queries regarding the questionnaire to ICASA. ICASA will thereafter publish a consolidated response to all queries received in FAQ format on its website.
___[21 March 2016] Housekeeping. Cell C has given notice of its withdrawal of its application for review of the Call Termination Regulations 2014 with particular reference to the mobile termination rates and allowable asymmetry [see entry from 18 December 2014 below].
The current termination rate regime has specified maximum fixed and mobile call termination rates up the end of September 2017. With ICASA due to start a new process in the next few months it is plausible that the withdrawal is simply recognition of the delays in litigating which have made any potential remedy worthless.
___[30 March 2015] ICASA has published a reasons document setting out the reasons for the position it adopted in the Call Termination Regulations 2014.
ISPA’s complaint was lodged after some of its members received a notification from MTN on 22 October 2014 in the following terms:
“All international originated voice traffic destined for the MTN network will be charged a 0.25USD/minute or equivalent thereof in South African Rand (ZAR) or any other foreign currency as termination rate as of 1 November 2014.
Internationally originated voice calls transiting on MTN’s network to other South Africa networks will be charged at 0.25USD/minute or equivalent thereof in South African Rand (ZAR) or any other foreign currency as termination rate as of 1 November 2014.”
ICASA has come out strongly against MTN’s proposed tariff differentiation:
Differentiation between traffic originating within and outside the borders of South Africa
- The Call Termination Regulations, Government Gazette No. 38042 of 30 September 2014 (“the Regulations”) make no distinction between termination services for voice calls originating within and outside of the borders of South Africa.
- The service offered by MTN to other licensed operators constitutes termination services as defined in terms of the Regulations.
- By charging a different rate for termination between licensed operators in the manner that it has, MTN is in breach of the non-discrimination principles as per section 37 (6) of the Electronic Communications Act.
Amendment of interconnection agreements
- Regulations 17 and 19 of the Interconnection Regulations, 2010, Gazette Number 33101 of 9 April 2010 state that an interconnection agreement and interconnection amendment agreement must be submitted to the Authority in terms of section 39 of the Act for filing. Any amendment to an interconnection agreement must comply with regulation 7, read with section 39 of the Act, failing which the amendment would be invalid.
- The Authority therefore determines that the notice by MTN informing its interconnection partners what it would charge its interconnection partners is a unilateral amendment of the interconnection agreement. The conclusion of an interconnection agreement must meet the first prerequisite of a contract, which is that parties have reached agreement, as envisaged in section 37(4) of the Act. Therefore the current terms of the interconnection agreements remains binding, until there is mutual agreement between the parties to amend.
ICASA directed MTN to immediately cease collection of the USD0.25 from local interconnecting partners and to comply with the charging regime contained in the Call Termination Regulations, 2014, as reflected in the interconnection agreements.
It remains to be seen whether this will be challenged, but for now we welcome further clarity on the scope of application of the Call Termination Regulations 2014. ICASA is also to be congratulated on acting firmly and expeditiously.
___[18 December 2014] In a nod to the critical role of termination rates to their sustainability, Cell C have given notice of their intention to seek a review of the Call Termination Regulations 2014 with particular reference to the mobile termination rates and allowable asymmetry set out in the 2014 Regulations. To this end Cell C has made a detailed request for information from ICASA which was used in the making of their decision to set the current glide path and asymmetry levels for the mobile termination market.
___[30 September 2014] ICASA has published final Call Termination Regulations 2014. The provisions and rates set out in these Regulations are effective as of 1 October 2014.
The rates differ substantially from those set out in the draft linked to immediately below. While an explanatory document will be published in due course, we understand that this was as a result of errors made by ICASA in the modelling undertaken to establish the rates and the degree of asymmetry…
Fixed call termination rates:
|Period||Regulated rate||Asymmetry (Maximum)|
|1 October 2014 – 31 September 2015||R0.12||R0.15||R0.18 (50%)||R0.21 (40%)|
|1 October 2015 – 31 September 2016||R0.11||R0.12||R0.15 (36%)||R0.16 (33%)|
|1 October 2016 – 31 September 2017||R0.10||R0.10||R0.12 (20%)||R0.12 (20%)|
Mobile call termination rates:
|1 Oct 2014 – 30 Sep 2015||R0.20||R0.31 (55%)|
|1 Oct 2015 – 30 Sep 2016||R0.16||R0.24 (50%)|
|1 Oct 2016 – 30 Sep 2017||R0.13||R0.19 (46%)|
___[6 September 2014]
___[18 August 2014] As part of the process leading up to finalising new regulations to replace those declared unlawful by the High Court, ICASA has issued a briefing note on the costing standards to be used in determining the extent to which termination rates should be reduced. ICASA has decided to adopt Long-Run Incremental Cost Plus (“LRIC+”) as the cost standard for the purposes of the current review.
___[28 May 2014] Following the workshop held on Friday 23 May, ICASA has published an FAQ on the questionnaires.
Briefing note on issues raised during the 2014 Wholesale Voice Call Termination Regulatory Review Workshop (external link to ICASA site)
The deadline for submissions is now 20 June 2014.
___[22 May 2014] ICASA has launched a new process to review the wholesale voice call termination markets in South Africa. To this end it has issued a questionnaire to licensees so as to allow it to collect information on which to base its decisions.
The following guides and templates have been provided.
Responses to the questionnaires are expected in Excel format only and must be submitted to ICASA via email@example.com on or before Friday the 13th June 2014.
ICASA has issued a press release stating, inter alia, that it is open to responses from the industry on the questionnaires and input from the public on the process. It will host a “questionnaire clarification workshop” in the Block C presentation room at its head office on Friday 23 May 2014 from 10h00-15h00.
___[23 April 2014] Applicable rates to 30 September 2014:
Wholesale voice termination rate to a mobile location (market 1)
|1 April 2014 – 30 September 2014||R0.20|
Wholesale voice termination rate to a fixed location (market 2)
|Period||WON Rate||BON Rate|
|1 April 2014 – 30 September 2014||R0.12||R0.16|
Maximum asymmetrical rate in market 1 (mobile)
|1 April 2014 – 30 September 2014||R0.44|
Maximum asymmetrical rate in market 2 (fixed)
|Period||Maximum Rate WON||Maximum Rate BON|
|1 April 2014 – 30 September 2014||R0.13||R0.21|
(prices per minute ex VAT)
___[11 April 2014] An excellent article by Heather Irvine, Head of Competition at Norton Rose Fulbright which captures the challenge posed to ICASA and the Department of Communications by the judgement in the call termination dispute.
___[5 April 2014] To complete the set we have obtained ICASA’s affidavit filed in response to those filed by MTN and Vodacom respectively.
___[2 April 2014] We really like the judgement delivered in the High Court. Not everyone will.
Full judgement (external link to Techcentral)[30 March 2014] Hard to keep up…
ICASA, in the midst of the court hearing regarding the MTN and Vodacom applications, has thrown a further twist through the publication of the Second Call Termination Amendment Regulations 2014. The effect of this second amendment is to remove all reference to years two and three of the glide path referred to in the Call Termination Regulations 2014, i.e. these regulations now effectively would apply for one year.
It remains unclear when they will come into force, if at all. The South Gauteng High Court is expected to make an initial ruling on Monday 31 March 2014.
___[1 March 2014] Vodacom has also filed a notice of application seeking to have the implementation of the Call Termination Regulations 2014 suspended pending a review of their lawfulness.
While the timelines for the two applications are not yet clear it appears that
– the two applications will be consolidated into a single one
– opposing papers in the MTN application are to be filed by Monday 3 March 2014
– a court date will be agreed upon towards the end of March.[20 February 2014] ICASA indicated in a further media release that it had decided that the commencement of the 2014 Regulations need only be delayed by one month. It is in the public interest that MTN’s application for interim relief be resolved as expeditiously as possible. After studying the papers, the Council of ICASA is also of the view that a delay of one month is sufficient to ensure that the affected parties have sufficient time to properly prepare their answering papers.
On 19 February 2014 ICASA published the Call Termination Amendment Regulations, 2014 which (i) delay the commencement of the 2014 Regulations by one month from 1 March 2014 to 1 April 2014 and (ii) extend the operation of the 2010 Regulations by one month.
___[15 February 2014] In response to MTN’s initiation of legal proceedings (see below) ICASA has announced that it will itself suspend the implementation of the Call Termination Regulations 2014.
“The application is complex, comprising some 399 pages. Affected parties are afforded very little time to respond, in that answering affidavits are required to be filed by 18 February 2014. The urgent application was enrolled for hearing on 25 February 2014.
ICASA has decided that it is in the public interest for the urgent application to be heard and decided on a less urgent basis. The High Court’s decision will have wide-ranging effects on the parties and the public at large, including subscribers for telecommunications services.
As such, it is important that the High Court is fully informed of all the relevant issues before making its decision and it is therefore necessary that the affected parties have sufficient time to properly prepare their answering papers, particularly given the complexity of the matter.
To this end, ICASA will shortly publish the Call Termination Amendment Regulations, 2014 (the Amendment Regulations) in terms of section 4(1) read with sections 4(7)(b) and 67(8) of the Electronic Communications Act, 2005 (Act No. 36 of 2005) (the ECA) which provisions confer on ICASA the power to make regulations without following the processes described in section 4(4) of the ECA where the public interest requires that a regulation should be made without delay.
The Amendment Regulations will be published to (i) delay the commencement of the 2014 Regulations from 1 March 2014 to 1 May 2014 and (ii) extend the operation of the Call Termination Regulations, 2010/11 (published under GN1015 in the Government Gazette 33698 of 29 October 2010).”
___[13 February 2014] MTN has commenced formal legal proceedings for a review of the Call Termination Regulations 2014, seeking an urgent interdict to suspend the implementation of the provisions of the regulations relating to the proposed new glide path and asymmetry for mobile termination (it appears the impact will be to suspend the implementation of the regulations as a whole). Call Termination Regulations 2014 were gazetted on 4 February 2014.
___[29 January 2014] ICASA announced the finalised structure for the reduction of termination rates during a media briefing today.
ICASA Statement on 2014 Call Termination Regulations (29 January 2014)
The rates set are:
Table 1: Wholesale voice call termination rates to a mobile location (Market 1)
|1 March 2014 – 28 February 2015||R0.20|
|1 March 2015 – 29 February 2016||R0.15|
|1 March 2016 onwards||R0.10|
Table 2: Wholesale Voice Call Termination Rates to a Fixed Location (Market 2)
|Period||WON Rate||BON Rate|
|1 March 2014 – 28 February 2015||R0.12||R0.16|
|1 March 2015 – 29 February 2016||R0.12||R0.12|
|1 March 2016 onwards||R0.10||R0.10|
Table 3: Maximum Asymmetry Rate for Market 1 (Mobile)
|1 March 2014 – 28 February 2015||R0.44|
|1 March 2015 – 29 February 2016||R0.42|
|1 March 2016 – 28 February 2017||R0.40|
|1 March 2017 onwards|
Table 4: Maximum Asymmetry Rate for Market 2 (Fixed) Period
|Period||WON Rate||BON Rate|
|1 March 2014 – 28 February 2015||R0.13||R0.21|
|1 March 2015 – 29 February 2016||R0.13||R0.13|
|1 March 2016 – 28 February 2017||R0.13||R0.13|
|1 March 2017 onwards||R0.13||R0.13|
[10 October 2013] The deadline for public comments has been extended to 15 November 2013.
ICASA have also released an Explanatory Note to the Draft Call Termination Regulations 2013
___[6 October 2013] Call Termination draft regulations Final 20131004b
Details as provided by ICASA below. Comments are due by 16h00 on 24 October 2013.
ICASA NOTICE OF PUBLICATION OF THE DRAFT CALL TERMINATION REGULATIONS AND AN EXPLANATORY NOTE TO ACCOMPANY THE DRAFT “CALL TERMINATION” REGULATIONS
4th October 2013
Johannesburg – The Independent Communications Authority of South Africa has made its determinations on the future of both mobile and fixed termination rates for the next three years, based on a review of industry conditions.
The revised rates are outlined in the tables below:
Table 1: Termination to a mobile location, 2014-2016 Termination Rate Current R 0.40 01-Mar-14 R 0.20 01-Mar-15 R 0.15 01-Mar-16 R 0.10
Table 2: Termination to a fixed location: 2014-2016 Between 0N Within 0N Fixed Termination Rate R 0.19 R 0.12
The Authority makes this determination based on a review of the effectiveness of competition in the market for call termination.In 2010 the Authority determined that ineffective competition existed in the provision of call termination because of, amongst others, inefficient pricing. The Authority imposed cost-oriented pricing on Vodacom and MTN for mobile termination and Telkom for fixed termination.The Authority finds that the market remains ineffective with extremely high levels of concentration, where the market for termination to a mobile location and the market for termination to fixed and mobile locations have a Herfindahl-Hirschman Index of greater than 4000, where 1800 is the estimated highest value before a market exhibits ineffective competition.The revised termination rates apply to Vodacom and MTN for mobile termination and Telkom for fixed termination. The Authority further determines that there is a need for further asymmetry based on:
- Traffic imbalances reflecting economies of scale
- to promote investment
- to encourage competition
- to foster SMMEs
The level of asymmetry available to licensees offering termination to a mobile location is outlined in the table below:
Table 3: Maximum asymmetric termination rate which a qualifying licensee may charge for termination in Market 1 Current Termination Rate R 0.44 01-Mar-14 R 0.39 01-Mar-15 R 0.33 01-Mar-16 R 0.26 01-Mar-17 R 0.20 01-Mar-18 R 0.14 01-Mar-19 R 0.10 01-Mar-16 R 0.10