South Africa Considers Policy Change to Allow Elon Musk’s Starlink to Operate Without Local Ownership
South Africa is considering a significant policy change that might allow Elon Musk’s SpaceX and other satellite internet providers to operate within the country without needing to relinquish ownership stakes.
The Department of Communications and Digital Technologies is currently reviewing over 19,000 public submissions regarding a proposal to modify black economic empowerment (BEE) regulations.
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The proposed amendment would enable IT companies to fulfill transformation objectives through equity-equivalent programs, rather than the existing 30% black ownership mandate.
“We are prioritizing this; we can’t just sit on the submissions,” Communications and Digital Technologies Minister Solly Malatsi stated during an interview in Johannesburg on Tuesday. “Once we complete our review, and based on public sentiment, we can present our findings to Icasa for the final decision,” he added, referencing the Independent Communications Authority of South Africa.
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Starlink Advocates for Entry Into South African Market
This review comes as Elon Musk, born in Pretoria, aims to expand Starlink, his low-Earth orbit satellite internet service, into South Africa. Musk has declined to give up equity, labeling South Africa’s empowerment laws as “openly racist.”
SpaceX has formally endorsed the suggested amendment. Satellite internet technology, enabled by networks of low-orbit satellites, could be transformative for South Africa, where access is still inconsistent and costly. A 2023 national survey indicated that only 1.7% of rural households have internet access.
Allowing companies to function under equity-equivalent arrangements would permit them to invest in infrastructure, digital inclusion projects, or research that directly benefits historically disadvantaged communities.
This method resembles exemptions already provided in other sectors, such as the automotive industry, where global manufacturers like BMW, Ford, and Toyota finance empowerment initiatives.
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Broadband Access Essential for South Africa’s 2030 Aspirations
Preliminary feedback on the policy review signals considerable support for reform, according to Malatsi. If approved, the change would benefit not just newcomers like SpaceX but also established players such as MTN Group and Vodacom Group, along with companies from Asia, the UAE, and the US.
South Africa’s National Development Plan aims to provide universal and affordable broadband access by 2030. To accomplish this, the government recognizes the need to adopt new technologies.
“It would be naive for the government not to leverage new technologies — particularly satellite technologies — to enhance South Africa’s broadband connectivity,” Malatsi noted.
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