ANNOUNCEMENT OF THE FINAL END-USER AND SERVICE SUBSCRIBER CHARTER REGULATIONS - STATEMENT BY CLLR MOKHELE

26 April 2018

The End-User and Subscriber Service Charter Regulations seek to protect the rights of consumers by, among others, ensuring that they are provided with sufficient information that will assist them in making informed decisions; as well as facilitate redress for those consumers who have been unfairly treated by network providers.

 Ladies and gentlemen

The review of the 2016 End-user and Subscriber Service Charter Regulations was underpinned by the general concerns about the data expiry and out-of-bundle data rules, which are perceived to be prejudicial to consumers, in particular the poor.

 It is a well-known reality that South African citizens are concerned about the money they spend every month on their consumption of data services. Whilst the Authority acknowledge the concern with regard to the perceived high cost of data and high out-of-bundle rates, it is important to note that the review of the End-User and Subscriber Service Charter Regulations of 2016 does not seek to directly or indirectly regulate the price of data services. Our objective

is to develop minimum standards in respect of the provision of data, SMS and voice services in line with section 69 of the Electronic Communications Act of 2005 (ECA).

Based on concerns raised by consumers, the Authority published an amendment the End-user and Subscriber Service Charter Regulations on 7 August 2017 which included the following amendments 

- new timeframes for the expiry of data bundles, with the shortest being 10 days for bundles between 1MB and 50MB, and the longest being 24 months for 20GB;

- requirement for licensees to send usage notifications for data depletion to end-user; and

- for end-users to be able to opt-out or opt-in to out-of-bundle pricing on data, voice and SMS.

However, after analysis of submission on the draft Regulations the Authority published second draft Regulations for further consultation. The second draft Regulations proposed that, among others, licensees should provide prepaid data bundles with a minimum expiry period of three (3) years in line with section 63 of the Consumer Protection Act.

ICASA received thirteen (13) written submissions on the second draft Regulations from interested parties who further indicated their willingness to participate in the oral representations before the Committee of Council. These public hearings took place from 1 to 2 March 2018. 

We continued to encourage the general public to participate in these processes including the public hearings given the general concern around perceived high cost of data as well as expiry of data bundles and out-of-bundle business rules applied by network service providers.

Today the Authority is in a position to announce that it has reached the final stage in respect of this review process. The Authority will publish the final Regulations in the government gazette in the next few days. In terms of our decision, the Authority holds the view that the new regulations will, among others, benefit consumers in respect of the following:

Usage notifications – all licensees are required to send usage depletion notifications to consumers when their usage is at 50%, 80% and 100% depletion levels. This will enable consumers to monitor their usage and control spend on communication services.

Rollover of data – all licensees are required to provide an option to consumers to rollover unused data. This is to ensure that consumers do not lose unused data as is the current practice. 

Transfer of data – all licensees are required to provide an option to consumers to transfer data to other users on the same network.

Out-of-bundle billing – all licensees are no longer allowed to charge consumers out-of-bundle rates for data when their data has run out without the consumers’ specific prior consent. This will ensure that consumers are not defaulted to out-of-bundle data charges which are significantly higher than in-bundle charges.

Notwithstanding this process, it is important to note that the Authority may regulate prices of telecommunications services (including data services) after following the necessary steps envisaged in chapter 10 of the Electronic Communications Act.

Ladies and gentlemen

Our role as the regulator is to ensure that all South Africans have access to a wide range of communication services at affordable prices. In order achieve this the Authority is mandated by Chapter 10 of the ECA to ensure that there is competition in the sector. 

In order to enhance this competition, the Authority is required to follow an extensive regulatory process that includes consultation with all relevant stakeholders. The process involves defining markets, identification of licensees with Significant Market Power (where the defined markets are found to be ineffectively competitive) and impose proportionate pro-competitive remedies, including price controls, etc. 

In short, ICASA has regulatory powers to regulate competition in any of the markets within the ICT sector, after following extensive market review process contemplated in chapter 10 of the Electronic Communications Act. 

In 2017, the Authority initiated a process to identify a list of markets that depict the likelihood of ineffective competition, which could be detrimental to consumers in the form of high prices, low quality of service, etc. The Authority subsequently published a Discussion Document on Priority Markets for public comment. 

The Authority’s preliminary view is that the following markets should be prioritized for market reviews:

- Wholesale fixed access services;

- National transmission and metropolitan connectivity; and

- Wholesale supply of mobile network services and RAN services.

The Authority envisages to finalise the priority market exercise by publishing a Findings Document with a list of priority markets in June 2018. After finalising this exercise, the Authority will immediately commence market reviews in respect of the identified priority markets.

In closing, ICASA would like to thank all stakeholders that took part in this process and ensuing processes. We would like to continue to encourage the South African to make their comments and submissions on our regulatory processes so that we are able to develop informed regulations that are indeed in the public interest.

I thank you.

Issued by ICASA, 26 April 2018