It is argued that the policy directive would allow companies like Starlink to avoid meaningful transformation requirements in favour of less substantive alternatives.
Communications and Digital Technologies Minister Solly Malatsi’s policy direction allowing foreign satellite operators to use equity equivalents instead of traditional Black Economic Empowerment ownership requirements has triggered fierce opposition from both the EFF and ANC, who accuse him of illegally circumventing Parliament.
The controversy erupted after Malatsi announced that the final policy direction had been gazetted on Friday, 12 December 2025, following a draft published in May.
The directive permits companies like SpaceX’s Starlink to bypass the 30% local ownership requirement through alternative compliance mechanisms.
The EFF issued a scathing statement condemning what it described as Malatsi’s attempt to subvert South African laws to benefit Elon Musk’s Starlink operation.
“In an obvious attempt to avoid the Parliament of South Africa which is where the necessary amendments to achieve his mischief should be processed, Malatsi has presumed upon himself the powers to implement what is substantively an amendment to the Electronic Communications Act and the ICT Sector Code,” the EFF said.
The party argued that the policy directive would allow companies like Starlink to avoid meaningful transformation requirements in favour of less substantive alternatives.
EFF raises job and security concerns
The EFF said it had consulted extensively with telecommunications industry stakeholders who confirmed their concerns about Starlink’s potential impact on local employment.
“Starlink poses a threat to jobs in the industry due to its remote operational nature,” the party stated.
Beyond economic considerations, the EFF warned that Musk’s ownership of the satellite network posed a significant national security threat.
The party cited what it described as Elon Musk’s “hostility” toward the nation.
“For an unrepentant racist and megalomaniac like Elon Musk to enter the telecommunications market in South Africa, granting him possible control of infrastructure in the long term, is irresponsible,” the party said.
It warned it would pursue all available mechanisms to block the directive’s implementation.
“The EFF will pursue all mechanisms in Parliament, in the courts, and on the streets to ensure that his illegal directives are not implemented,” the statement read.
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ANC questions ministerial overreach
The ANC echoed concerns about the legality of Malatsi’s approach.
It argued that the minister had exceeded his authority by attempting to amend legislation through a policy directive rather than through Parliament.
“The ANC stresses that no minister may amend or suspend legislation via a policy directive. Laws such as the Electronic Communications Act, the Postal Services Act, the ICASA Act, and the Broad-Based Black Economic Empowerment Act can only be changed through Parliament following public participation,” the party said.
The ANC characterised the move as part of a broader pattern within the government of national unity (GNU).
“It mirrors a troubling trend where Ministers belonging to the DA seek to bypass Parliament, by reforming laws through directives rather than following democratic legislative processes,” the ANC stated.
Concerns over transformation and public consultation
The ANC questioned the legitimacy of the public consultation process, despite Malatsi’s claim of receiving over 19 000 submissions with 90% support.
“However, these figures raise serious questions: How were the submissions counted? Were they independently verified? And do they genuinely reflect broad public support, or merely the views of a limited, possibly organised group?” the party asked.
The party warned that weakening the 30% Historically Disadvantaged Groups ownership requirement would undermine decades of progress in building an inclusive ICT sector.
“South Africa has invested decades building an ICT sector that promotes inclusion, localisation, SMME support, and equitable ownership. Weakening these obligations does not modernise the sector; it risks reversing hard-won gains and entrenching foreign dominance in a strategic national industry,” the ANC said.
Digital sovereignty and regulatory independence at stake
Both parties raised concerns about the directive’s impact on the Independent Communications Authority of South Africa’s (Icasa) autonomy.
The EFF noted that Icasa expressed concern about the legality of the minister’s proposals during a Portfolio Committee meeting in May 2025.
“The attempt to coerce the Independent Communications Authority of South Africa to comply with this illegal instruction, which is not consistent with the ECA and ICT Sector Code, is a clear undermining of ICASA’s institutional autonomy,” the EFF said.
Furthermore, the ANC also noted that requiring the regulator to apply measures that contradict primary legislation would create instability in the regulatory system.
“As an independent regulator, Icasa exists to ensure fairness, stability, and legal certainty in the communications sector.
“Forcing it to implement measures inconsistent with primary legislation is unlawful, undermines institutional independence, and destabilises the regulatory environment,” the party stated.
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Malatsi defends policy direction
On Friday, Malatsi had already defended his decision, arguing that the policy direction ensures proper recognition of economic empowerment while attracting investment and expanding internet access.
“The purpose of this policy direction is to ensure that the full scope of economic empowerment is properly recognised and applied in the ICT sector.
“This alignment will help attract more investment, support meaningful transformation and improve the lives of South Africans, especially those in rural and underserved communities who still lack access to high-speed internet,” Malatsi said.
The minister claimed that the directive corrects regulatory inconsistencies created when Icasa amended its ownership regulations in 2021 and 2022 without fully aligning them with the BBBEE Act and ICT Sector Code.
Moreover, Malatsi stated that mobile network operators, through the Association of Communications and Technology, supported ensuring that all licensees meet the same regulatory standards, including:
- payment of fees
- contributions to the Universal Service and Access Fund
- fulfilment of universal service and social obligations
- adherence to ICASA regulations
- compliance reporting
He further insisted his directive maintains regulatory fairness across the sector.
“The final policy direction reinforces the need for regulatory parity. It does not favour any entity, bypass the Electronic Communications Act, or weaken transformation.
“Any changes Icasa makes to its regulations will apply equally to all licensees, as required by the ECA and the ICT Sector Code,” Malatsi said.
The ANC has called on Parliament’s Portfolio Committee on Communications and Digital Technologies to urgently hold the minister accountable, while urging Icasa to refuse any directive inconsistent with the law.
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