Telecommunications Amendment Bill: finalisation

Meeting report

COMMUNICATIONS PORTFOLIO COMMITTEE
18 October 2001
TELECOMMUNICATIONS AMENDMENT BILL: FINALISATION
 

Document D: Telecommunications Amendment Bill
Bill with all amendments incorporated [B65B-01]

SUMMARY
The Telecommunications Amendment Bill was accepted by the Committee with amendments. The Democratic Alliance and/or the Inkatha Freedom Party abstained or voted against Clauses 1, 4, 5, 6 and 9.

MINUTES
Clause 1
The Chair announced the following amendments to the Definitions Clause (Clause 1):
- page 2, line 14: In subclause (a), after licensee the words ‘or an underserviced area licensee’ should be inserted.
- page 2, line 50: After ‘country’ insert ‘vice versa’.
- page 3, line 2: Insert ‘in the Republic’ after ‘directly’.
- page 3, line 5: Omit ‘service’ and insert ‘operator’.
- page 3, line 16: Omit the definition of ‘end office’.
- page 3, line 18: Insert ‘Eskom means Eskom referred to in the Eskom Act, 40 of 1987 and includes its subsidiaries.
- page 3, line 30: insert ‘fixed mobile service’.

Discussion
Ms M Smuts (DP) stated that the Committee had already looked at ‘within a geographical service area of local exchange’ and she had objected to its inclusion. She had suggested that it should be replaced with some reference to specific cell-based station. The Committee had decided to deal with the issue of ‘geographical area’ in the definitions clause where the meaning of call hand-over would be explained. The problem is that ‘geographical area of local exchange’ has been omitted.

The Chair said that Ms Smuts was remembering the discussion incorrectly. From discussions with the mobile operators and Telkom, it had become evident that the clause had to be written so as not to give Telkom, underserviced area licensees or the SNO the right to use mobile cellular. Mobile cellular operators use cells. It is important that there should be mobility, but this mobility should be limited within a geographical area. It is however not the intention to limit the kind of technology that can be used. Thus, in the definition of ‘fixed mobile’ the words ‘once in motion within the local exchange area’ should be inserted. The words ‘geographical service area of a local exchange’ should be deleted. Call hand-over will however not be permitted.

The Chair continued that in terms of Telkom’s licence ‘local exchange area’ had referred to the ‘geographically defined area as defined from time to time by the licensee within which all exchange lines are connected by the same local exchange’. This had been acceptable when Telkom had been a monopoly. The new definition of local exchange overrides the licence of Telkom. It now refers to the geographically defined and limited area as defined by the exchange area code allocated by the Authority for that area (to which all exchange lines are connected and served by the same local exchange). Thus, if Telkom, the SNO or the underserviced area licensee wish to have a local exchange area defined it should be done by the Authority and not by a licensee.

Although the mobile operators are not entirely happy with the new clause, it is preferable to the old definition, which had been too open-ended.

Mr V Gore (DP) said that local exchange area had been defined in terms of the exchange area code. There will be a problem when number portability is introduced in 2005.

The Chair responded that this could be dealt with in 2005 when the problem arises.

Ms S Vos (IFP) said the Inkatha Freedom Party would have to oppose the clause, as they had not been able to test the proposal and what it means.

The Chair stated that the proposal comes from the mobile operators and Telkom. In addition, this is why there is the Authority and courts.

Ms Vos asked if the Chair is saying that the clause is open to litigation.

The Chair denied this, saying there is a need for the Authority to deal with matters in the area of fixed mobile.

The Chair continued to discuss the definition of fixed mobile service. It means the service provided by the holder of a Public Switched Telecommunications Service licence or underserviced area licence that permits a customer of the licensee to access the public switched network of the licensee and obtain telecommunications services from such licensee within a local exchange, but shall not permit call hand over.

Mr Abrams (UDM) asked if the Chair was satisfied that the mobile operators are willing to accept this definition.

The Chair said that this was the best the Committee could do. It makes the clause clearer.

Ms Vos said that the clause is saying the same thing.

The Chair argued that there had not been a definition for local exchange area previously. Only Telkom could previously define this. The definition is now left to the Authority.

Dr Cwele (ANC) said that everyone is aware that the mobile operators are not entirely happy with the clause. However it is preferable to the previous situation, as the clause provides guidelines as to how the term would be defined. It is for this reason that the ANC supports the clause.

Amendment of clause (1) continued
- page 3, line 46: omit ‘definition’ and substitute ‘definitions’.
- page 3, line 55: The Chair referred members to the definition of local telecommunications service in Document C.

The Chair asked if members accepted the definition of ‘local exchange area’.

Ms Smuts opposed the definition, as it is part and parcel of fixed mobile services.

- page 3, line 59: mobile cellular telecommunications network is defined as being designed to use limited radio frequency spectra between cellular terminal equipment and network transceivers.
a)to provide mobile service across cellular networks according to technical standards that are applicable to assigned frequencies
b)by allocating a limited number of frequencies within each of a number of defined geographical areas or cells
c)allowing the re- use of the same frequency in different non- adjacent cells
d)enabling users to maintain connectivity while moving between different geographic areas by making use of call hand overs between adjacent cells.

The Chair continued that mobile cellular telecommunications service means telecommunications as provided by mobile telecommunications licenced operators as referred to in S37.
- page 4, line 1: after ‘mobile’, insert the word ‘cellular’.
- page 4, line 3:omit digital broadcasting service that combines’ and substitute it with ‘telecommunication service that integrates and synchronises’.
- page 4, line 18: refer to document C (point 14) for the amendment.
- page 4, line 22: omit up to and including ‘service’ and include ‘when changing services from one PSTS licensee to another or from one mobile cellular telecommunications licensee to another mobile telecommunications licensee’.
- page 4, line 26: amended as in document C (point 15) with the exception that ‘one’ is omitted and ‘two’ is inserted.
- page 4, line 31: as amended in document C (point 16)
- page 4, line 34: Omit ‘on a subscription basis’ and insert ‘to an end user on a subscription basis or for a fee’.
- page 4, after line 62: Insert ‘teledensity means the number of telephone lines per 100 persons'.
- page 5, line 3: Omit (p).
- page 5, from line 7: Adopt the amendment as in document C. Add point (c) which states ‘managed data network services’.

Discussion
Ms Vos suggested the use of ‘and’ instead of ‘or’ which the Committee accepted.

Ms Vos noted her abstention from voting on Clause 1 on behalf of the Inkatha Freedom Party. United Democratic Movement indicated their support for the clause.

Clause 2
This clause was accepted as amended.

Clause 3
Ms Smuts stated that the DP would make their decision as to its inclusion once a definition of multimedia has been provided, as this clause deals with broadcasting.

Mr Smuts, the State Law Advisor, referred to the inclusion of S28 (3). Although the clause has been repealed there are still remains of this section evident in the clause. It should therefore be retained in the clause for the purpose of cross-references.

Ms Vos opposed the clause on the basis that ‘digital broadcasting’ should be replaced by ‘telecommunications’.

Clause 4
- page 5, line 29: Omit (6) and (7) and insert (5).

Clause 5
- in (1), (2) and (3), after ‘mobile’, insert ‘cellular’.
- page 6, line 6: Omit ‘such once-off fee’ and substitute ‘such fee payable over a period’.

Ms Vos said the word ‘fees’ should be used to illustrate the shift away from the once off fee. In addition, (c) should fall away, as it is only relevant to a lump sum.

Mr E Magashule (ANC) agreed.

- page 6, line 13: After ‘mobile’, insert ‘cellular’.
- page 6, lines 22 and 29: Omit references to ‘fixed mobile services’.
- page 6, line 34: References to ‘such once off fee’ are to be replaced by ‘such fees payable over a period.
- page 6, line 60 and page 7, lines 1, 3, 6, 11 and 17: After ‘mobile’, insert ‘cellular’.
- page 7, line 6: Replace references to ‘such once off fee with ‘ such fees payable over a period’.
- page 7, lines 21 and 28: Omit references to ‘fixed mobile services’.
- page 7, line 33: Replace references to ‘such once off fee’ with ‘such fees payable over a period’.

Discussion
Mr Smuts referred to page 6, line 9 and stated that (c) is repeated in line 37.

The Chair stated that it could be omitted in line 37.

Ms Smuts said that one would then be omitting the multiple payment schedule altogether.

Mr Smuts stated that the previous clause also omits the multiple payment schedule.

Ms Vos suggested that ‘as the Minister shall determine…..fee(s)’ is not necessary and can be deleted.

Mr Smuts agreed.

The Chair referred to S30A (d) and suggested the deletion of ‘ a single or’. It should also be deleted from page 7, line 10.

The Chair asked if members accepted the clause as amended.

Ms Smuts indicated her objection.

Clause 6
- page 8 : omit (b) and (c).
- page 8, line 33: After ‘granting’ insert ‘one or more’.
- page 8, line 34: Omit 1(a) and substitute (1).
- page 8, line 46: Omit 'after 7' and substitute 'by 8'.
- page 8, after line 46: Insert the following paragraph,' At least one of the additional operators shall be licenced to provide service- based competition'.
- page 9, from line 8: This should refer to 'Eskom and Transnet'.
- page 9, after line 22: Refer to paragraph 5 (a). After Transnet insert, 'and the SA Rail Commuters Corporation established by…' Delete from 'or any' until 'pursuant to'.

Mr Abrams pointed out the reference to the SA Transport Services Act, 1998 (Act No 9 of 1989). He asked if it was a 1998 Act or a 1989 Act.

Mr Smuts said that it was a 1989 Act.

The Chair referred to page 9, line 28. He asked why 'gateway service' was being amended.

Ms Smuts reminded him that members had been unwilling to refer to it as being a service.

The Chair again asked why it had been changed.

Mr Smuts said that it could be changed back.

- page 9, after line 27: This should read, 'Sentech shall provide the multimedia service as a common carrier on a reasonable, equitable and non- discriminatory basis.

Mr Magashule suggested the addition of the following paragraph, 'in respect of the granting of other licences (i) the Minister shall invite applications on the date to be fixed by the Minister by notice in the Gazette.(ii) The provisions of S34 (2) (b) and (c) shall apply with the necessary changes’.

The Chair referred to the reference to S34 (2) (b). He asked if members had decided that this section should be included in sub-clause (i) or (ii). The telecommunications companies had indicated that it should be included in sub clause (ii). He asked the State Law Advisor if the proviso of S34 has to be included or if it could be left to the Minister to decide.

Mr Smuts suggested that this should be included as a separate sub-clause. It should be inserted after the new subsection 2, after line 29.

- page 9, after line 38: add subsection (5),which states,' The holder of a telecommunications service licence shall not be precluded from providing services which are the same as or similar to multimedia services, provided that such services fall within the ambit of the telecommunications service licence so held’.

Dr Cwele asked where this caters for the all the current users of multimedia services.

The Chair asked whether, if Sentech provides the service on a non-discriminatory basis, it then means that any person could approach Sentech for a multimedia service. Does sub- clause (5) mean that any person can approach Telkom and say that they wish to provide multimedia services?

Mr Smuts stated that current providers are covered if they fall within the ambit of their licences. The problem arises where someone only provides part of the services.

The Chair asked if this is the clause that Multichoice is trying to push for. If any digital TV broadcaster is broadcasting a signal to a person and wants the back haul, once the law is passed can they continue to provide this service? Do they make use of the PSTS?

Dr Cielli (Telkom) replied that they would use the M-Web satellite.

The Chair asked on whom M-Web relies.

The DDG replied that M-Web sits on Telkom.

The Chair asked what the new Bill would mean to those who had broadcast signals with the back haul being carried by M-Web (which sits on Telkom).

The DDG stated that persons providing services are doing so on the basis of the licences that they had acquired under the various Acts. Multimedia specifies something else. It refers to the integrated synchronised services, which is what ICASA will license on the basis of the Invitations to Apply.

The Chair asked if the signal provided by DSTV is illegal if the back haul is not part of such synchronised and integrated service.

The DDG responded that if such signal were provided as multimedia (according to whatever its new definition will be), then it would be illegal.

The Chair argued that one should try not to close businesses down. If DSTV sends a signal to a subscriber using a Telkom line, will the back haul be regarded as an integrated and synchronised service once the Bill is passed?

Dr Cielli argued that once multimedia is defined, a person who acts under his/her licence should not be prevented from acting under such licence even if what they were doing could be construed as having elements of multimedia.

The Chair asked whether one would be breaking the law if one attempts to bank using the telephone or other electronic means.

Dr Cielli replied that the bank will provide the service via its PSTS links, VANS or via its Private Telecommunications Network. Thus it would not need a multimedia licence to provide such service. If however it wishes to do other things not provided for in this clause, then it would need a multimedia licence.

Dr Cwele indicated that they now understand how the rights of current multimedia providers will be affected and suggested that the Chair should move to the following clause.

The Chair asked if members accepted the clause as amended.

Ms Vos abstained on behalf of the Inkatha Freedom Party.

Ms Smuts opposed the clause as amended.

Clause 7 – amendment unopposed.

Clause 8
- page 9, after line 44: In sub- section 2 (a) (iv) delete the word 'or' and insert 'a multimedia service or'.
- page 9, line 49: Omit 'kinds of service' and substitute 'of service'.
- The Chair read the proposed amendments numbered (1) and (2) in Document C.

Clause 9
- page 10, line 58: Omit (2) and substitute (1).
- page 11, line 10: After 'groups' insert 'or held by'.

Ms Smuts abstained from voting.

Clause 10
- page 11, line 30: After 'such as' omit from 'beauty contest' until 'thereof' and substitute with ' by auction, tender or both and the licencing process that will apply'.

Clause 11
- The Chair read out proposed amendments numbered (1) and (2) in Document C.
- page 12, after line 14: Omit 'mobile basis, or a combination thereof' and substitute 'fixed mobile basis'.
- page 12, line 18: Omit subsection (2).

Clause 12
Ms M Smuts (DP) proposed that sections 37(2)(a) and (b) of the Telecommunications Act 103 of 1996 (the principal Act) be deleted as the prescribed inquiry has already been conducted.

The Chair agreed with this proposal.

Mr Smuts, from the office of the State Law Advisor (SLA), inquired whether this committee has decided to reject the proposed clause 12(1)(a) of the Amendment Bill.

The Chair replied that the proviso must be retained, and requested clarity on the precise meaning and status of section 37(2)(d) of the principal Act.

Ms Smuts informed the Chair that subsection 2(d) now becomes the new section 37(2) of the principal Act.

Mr Smuts recommended that the reference to "this Act" in the second line of the proviso in section 37(1) of the principal Act be amended to read "this section’, because "this Act" refers to the principal Act which is a date that has already passed.

Mr T Beale, a representative from Vodacom, called for the retention of the proviso in section 37(1) of the principal Act, and recommended that sections 37(2)(a) to (c) be deleted as those tasks have already been completed. Furthermore, the section 37(d) now becomes the new section 37(2) as suggested earlier. The amended section 37 would now have the "old" section 37(1) as the new subsection 1(a) and the new subsection (b) would be the provision proposed by clause 12(b) on page 12 of the Bill.

Mr Smuts reiterated his earlier concern that the reference to "this Act" in the proviso deals with a date that has already passed, and should therefore be changed.

Ms Smuts disagreed and stated that it was the intention of the legislature that it remain as it currently stands.

The Chair agreed that the wording should remain in its current formulation, and noted that all members consented to the proposed amendments to clause 12 of the Bill.

Clause 13
The Chair noted that all were in favour of the proposed clause 13 of the Bill.

Clause 14
The Chair noted that the proposal on page 7 of Document C relating to clause 14 was agreed to by the committee.

Clause 15
Ms S C Vos (IFP) suggested that the word "or" at the end of the proposed section 40(2)(a) be replaced by "and".

Ms Smuts agreed.

The Chair consented to this suggestion, and noted that clause 15 was agreed to by the committee.

Clause 16
The Chair reminded members that in the previous session of this committee it was agreed that subsection (ii) of proposal 3 on page 8 of Document C be deleted. The proposed subsection (ii) would be amended to read "managed and controlled or owned by women".

Ms M Magazi (ANC) questioned the reason for the deletion of subsection (ii).

The Chair replied that subsection (ii) is already covered by the objects of the principal Act, and it is therefore not necessary to expressly articulate these sentiments in a separate section. It is noted that proposals 4 to 6 on page 8 of Document C have been accepted by this committee. Furthermore, the amended clause 16 has been approved.

Clause 17
The Chair noted that the proposal on page 8 of Document C has been accepted by this committee and that clause 16, as amended has been approved.

Clause 18
The Chair noted that the first two proposals on page 8 of Document C have been approved by the members. There is, however, a mistake in proposal 3 because the only matter decided by the committee was that "the Authority shall publish the agreement and the interconnection rates contemplated in paragraph (a) in the Government Gazette."

Mr Smuts informed the Chair that, from a practical perspective, it would be rather costly to publish the often lengthy agreements in the Gazette, and suggested that the more viable option would be to merely make the agreement "public". Consequently the provision could read "the interconnection rates and any agreement regarding those rates shall be made public by the Authority."

The Chair agreed with this revised formulation of the provision, and noted that all were in favour of the adoption of clause 18, as amended.

Clause 19
The Chair noted that this clause, in its amended form, is approved by the committee.

Clause 20
The Chair noted that the members have consented to the formulation of clause 20 in the Bill.

Clause 21
The Chair noted that the committee has agreed to the enactment of clause 21.

Clause 22
The Chair noted that clause 22 has been rejected by this committee, and that the new clause proposed on page 11 of Document C has found favour with the committee.

Clause 24
The Chair noted that this clause has been agreed to by the members.

Clause 25
The Chair noted that the committee has decided to enact this clause.

Clause 26
The Chair noted that this clause has been accepted.

Clause 27
The Chair noted that the committee has agreed to the enactment of this clause.

Clause 28
The Chair noted that clause 28 has been accepted by the committee.

Clause 29
The Chair noted that the proposal on page 12 of Document C dealing with clause 29 has been agreed to by this committee. The new formulation of the "government directory information services" provision cannot be inserted in clause 31 of the Bill, because this issue properly belongs in clause 29. A new clause would thus be created after clause 29 entitled "Government Directory Information Services".

Ms Smuts advised that a cautious approach be adopted regarding the numbering of clauses in the Bill, as these must not create any unnecessary confusion by conflicting with the sections of the principal Act.

The Chair acknowledged the suggestion and assured Ms Smuts that a new section 83 would be created under clause 29 to deal with these services, and that this route would be "in order". He noted that the amended clause 29 was accepted by the committee.

Clauses 30 and 31
The Chair proposed that clauses 30 and 31 be considered together. The input from the SLA confirmed that the issues of "number portability" and "carrier pre- selection" in the proposed sections 89 and 89A respectively, have already been dealt with as matters of policy direction. For this reason clauses 30 and 31 are omitted from this law.

Ms Smuts expressed her disappointment at this decision.

The Chair suggested that the proposed section 89B of the principal Act could be included under "Government Directory Information Service" in clause 29 as the new section 84 of the principal Act.

Clause 32
Ms Smuts reminded the Chair that the decision had been taken during this committee’s last session to reject the proposal by clause 32 that the Minister be excluded from the regulation- making process, and also called for the deletion of sections 95(3) and 96(6) of the principal Act.

The Chair called for clarity from the Deputy Director General (DDG) in this regard.

Mr P Pongwane, the DDG, replied that the clause essentially affords the Authority greater regulation-making power.

The Chair then inquired whether the Authority had previously been vested with this power, or whether it was being introduced by this clause.

Ms Vos informed the Chair that there is an existing provision in the principal Act that bestows this power on the regulator.

The Chair consequently suggested that this clause be removed from the Bill, and called for input from the Authority in this matter.

Mr Njoka, the CEO of Independent Communications Authority of South Africa (ICASA), responded that the principal Act currently provides that the regulator may make regulations in so far as the provisions in the principal Act call on the regulator to pronounce via regulation. The proposed clause 32 thus "develops" the provisions in the principal Act as it now affords the regulator a "general power to regulate on any matter that may fall within the interests or objects of the Act".

The Chair agreed with this suggestion and noted that the proposal on page 13 of Document C was supported by the committee. He consequently noted that the committee was in favour of the enactment of the amended clause 32 of the Bill.

Clause 33
The Chair noted that the proposal on page 12 of Document C dealing with clause 33 was agreed to by the committee, and that the amended clause 33 found favour with the members.

Clause 34
Ms N Mtsweni (ANC) reminded the Chair that a formulation of the penalty clause in terms of section 101 of the principal Act has to be considered and finalized.

The Chair called for formulations in this regard.

Ms Smuts suggested "any person found guilty of an offence contemplated in section 101 shall on conviction be liable to a fine not exceeding R500 000, or to imprisonment for a period not exceeding 2 years, or to both such fine and such imprisonment".

The Chair asked the SLA if the supplying or selling of any equipment that is not "type approved" has already been made an offence under section 101 of the principal Act.

Mr Smuts replied that it is presently being enacted as an offence under the amendment to clause 34, and would read "a person shall be guilty of an offence if he or she [subsection (c)] contravenes sections 54 and 56".

The Chair was satisfied with this formulation and consequent amendment and noted that the committee agreed to the enactment of this clause, as amended.

Clauses 35 to 37
The Chair noted that all were in favour of these clauses.

Schedule
The Chair drew the committee’s attention to the proposal that all words commencing line 26 on page 22 up to an including line 38 on page 24 be deleted. He noted that this proposal as well as the schedule, as amended, was agreed to by the committee.

Long Title
Ms Smuts inquired as to the formulation of the long title of the Bill as it still refers to matters that have been excluded from the Bill, such as arbitration.

The Chair replied that the long title will be amended by the deletion of any reference to "Telecommunication Mediation and Arbitration Committee", and the like.

The Chair concluded deliberations on the Bill by declaring, with regard to The Portfolio Committee on Communication Report [B65- 2001] :
The Portfolio Committee on Communication, having considered the subject of the Telecommunications Amendment Bill [Bill 65- 2001], National Assembly section 75 referred to it and classified by the Joint Technical Mechanism as a section 75 Bill, reports the Bill with amendments [B65A- 2001], signed by myself on the committee members’ behalf on 18 October 2001, has been agreed to by the Portfolio Committee.

The meeting was adjourned.