South Africa’s coalition government is under fire from parliamentarians and civil-society groups after publishing a draft policy that would let foreign telecoms operators satisfy Black-ownership rules through “equity-equivalent” investments—a change opponents claim is designed to clear a path for Elon Musk’s Starlink satellite-internet service.
The rule at the centre of the storm
Under the Electronic Communications Act, network and service licence-holders must ensure 30 % of their South-African equity is owned by historically disadvantaged groups. SpaceX has never applied for a licence, saying the requirement is “openly racist,” while Starlink customers in neighbouring Botswana, Zambia and Mozambique already access the low-orbit network.
Communications minister Solly Malatsi last week issued a draft directive that would let companies substitute direct ownership with programmes such as local-supplier contracts, skills training or rural-connectivity projects of “equivalent” value. The public has 30 days to comment before the policy is finalised.
‘Back-door deal’ or overdue reform?
Opposition parties Build One South Africa and the Economic Freedom Fighters accused the government of “bending over backwards for a foreign billionaire” and warned the move “guts the spirit” of Broad-Based Black Economic Empowerment. Parliamentary committee chair Khusela Diko said she would summon Malatsi to explain “why national standards must move for one company when Vodacom and MTN complied years ago.”
Malatsi—whose Democratic Alliance has long criticised the equity quota—insists the reform is sector-wide, not a carve-out. “Transformation is non-negotiable,” he told lawmakers, arguing that alternative compliance would attract investment and extend broadband to rural communities without diluting empowerment goals.
Industry body ACT welcomed the draft as a chance to “restore policy clarity,” while labour federation Cosatu warned the change could “open floodgates to fronting and tokenism.”
Diplomatic undertones
The timing has stoked geopolitical intrigue. The proposal surfaced weeks after a tense White House meeting where U.S. President Donald Trump criticised South Africa’s racial-equity laws, and shortly before President Cyril Ramaphosa is due in Washington for the G20 summit. Bloomberg reported that Musk later met both leaders at the White House, fuelling speculation of U.S. pressure.
What happens next
- Public submissions close — 28 June; Malatsi has pledged to publish all comments.
- Regulatory guidelines — Regulator ICASA must draft licensing guidelines if the directive is adopted; officials say that could take six months.
- Legal challenge looming — The Democratic Alliance, despite holding the ministry, says it will ask the Constitutional Court to test whether any final rule change is consistent with the Act’s empowerment mandate.
For now, Starlink’s service map shows a conspicuous hole over Musk’s homeland. Whether the draft policy fills it—or fractures South Africa’s decades-old transformation framework—will depend on a 30-day consultation now loaded with political, economic and racial symbolism.