WHO TO CALL CONCURRENT COMPETITION JURISDICTION IN THE SOUTH AFRICAN ELECTRONIC COMMUNICATIONS SECTO

1
WHO TO CALL?CONCURRENT COMPETITION JURISDICTION
IN THE SOUTH AFRICAN ELECTRONIC COMMUNICATIONS
SECTOR
Heather Irvine and Lara Granville
2
Overview

• Who should regulate what?
• Relevant Legislation
• Case law to date
• Amendments

3
Who regulates?

• How does concurrency arise?
• Competition regulation
• Economic and access regulation
• Technical regulation
• Should these competition issues be regulated in
  sector specific legislation and which regulator
  should enforce them?

4
The Telecommunications Act

• Set up SATRA/ later ICASA
• Authority granted power to prohibit
  discriminatory conduct by Telkom or other
  licensee

5
The Competition Act

• This Act applies to all economic activity
  within, or having an effect within, the Republic,
  except- 
•  
• (d) acts subject to or authorised by public
  regulation  

6
Nedcor / Stanbic Case

• Bank mergers to be evaluated in terms of Banks
  Act
• Literal reading of Competition Act
• SCA The application of the Competition Act is
  excluded

7
Section 3(1A)

• Tried to make it clear that CC and other
  regulators have concurrent jurisdiction over
  competition matters
• This concurrent jurisdiction must be managed, to
  the extent possible by an MOU

8
Telkom case

• Complaint initiated by ISPs and VANS
• Commission referred
• Alleged exclusionary act/ refusal to provide
  access to an essential facility / price
  discrimination

9
Telkom Case

• Telkom applied to High Court to review
• CC has no power to refer and Tribunal has no
  power to adjudicate
• Conduct authorised / required by
  Telecommunications Act / licences and therefore
  ICASA
• Section 3(1A) states in so far as the
  Competition Act applies. Therefore, the
  Competition Act does not apply in the first place
  and no concurrent jurisdiction is established.

10
Telkom Case

• Telkom supplemented bases of review
• Bias
• CC failed to adhere to provisions of MOA

11
Telkom Case

• Commission argued
• Referral not reviewable
• Not authorised by Telecommunications Act, ICASA
  or the licenses
• Complex competition issues Tribunal and
  Commission as specialist bodies should decide
  them.
• Not mandatory to follow the procedures of MOA

12
Telkom Case

• High Court
• Jurisdictional point not decided
• Bias
• referral brought outside of 1 year period
• Both parties have appealed

13
Electronic Communications Act

• Significantly expands competition powers of ICASA
• Section 67(1), (2), (3) ICASA can address acts
  likely to substantially prevent or lessen
  competition
• ICASA can
• Define markets
• Make regulations regarding pro-competitive

14
Electronic Communications Act

• Section 67(9)
• subject to the provisions of this Act, the
  Competition Act applies to competition matters in
  the electronic communications industry.

15
Electronic Communications Act

• Parliament ignored Competition Authorities
  submissions on Convergence Bill
• ICASAs competition jurisdiction should be
  removed, concurrent jurisdiction was a stop gap
  measure
• final decision on prohibited practices should be
  made by competition authorities
• Subject to should be replaced with
  Notwithstanding

16
Competition Amendment Bill

• DTI proposed changes because
• Uncertainty in terms of ECA about who should
  police competition in regulated industries
• Competition Act should apply and should manage
  concurrent jurisdiction

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First version

• Amendment to Section 3 of Competition Act
• jurisdiction is concurrent in any case in which
  legislation assigns responsibility for
  competition matters within an industry to a
  sector regulator
• To be managed by MOA
• If not resolved by MOA, Competition Act will
  prevail

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First Version

• Consequent amendment to ECA
• Despite the provisions of this Act, the
  Competition Act applies to competition matters in
  the electronic communications industry
• Criticism of the Bill

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Second version

• In so far as this Act applies to any conduct
  arising within an industry or a sector subject to
  the jurisdiction of another regulatory authority
• concurrent jurisdiction is established
• any other regulatory authority contemplated in
  this subsection will exercise primary authority
  to establish conditions
• the Competition Commission will exercise primary
  authority to detect and investigate alleged
  prohibited practices, and to review mergers
• Concurrency to be managed in terms of MOA

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Effect of the Amendment

• ICASA primary authority over ex ante regulation
• Competition authorities primary authority over
  ex post regulation
• Makes it clear that competition authorities have
  a role in the sector
• Uncertainty remains in so far as this Act
  applies
• Hasnt removed ICASAs ex post jurisdiction
• Commission now acquires ex ante jurisdiction

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Conclusion

• Still scope for jurisdictional challenges
• An MOA cannot determine jurisdiction - can only
  manage it
• Courts (or further amendment) may be left to
  determine the scope of jurisdiction

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Contact

• Heather Irvine
• hpi_at_deneysreitz.co.za
• 011 685 8829
• Lara Granville
• lg_at_deneysreitz.co.za
• 011 685 8826