FORM OF APPLICATION AND MANNER IN WHICH IT IS CONTEMPLATED THAT THE SERVICE WILL BE
PROVIDED FOR ONE MOBILE CELLULAR TELECOMMUNICATION SERVICE LICENCE IN TERMS OF SECTION
34(2)(b)(ii) OF THE TELECOMMUNICATIONS ACT, 1996 (ACT NO. 103 of 1996)
1. INTRODUCTION
1.1. This document is provided in terms of section
34(2)(b)(ii) of the Telecommunications Act, 1996 (Act No. 103 of 1996) ("the
Act") and clause 3 of the "Invitation to Apply for One Mobile Cellular
Telecommunication Service Licence in terms of section 34(2)(a)(ii) of the
Telecommunications Act, 1996" ("Invitation to Apply") published under
Notice 314 of 1999 in Government Gazette 19806 dated 26 February 1999.
1.2. This document includes the following information:
1.2.1. the manner in which it is contemplated that the
mobile cellular telecommunication service will be provided;
1.2.2. notice of evaluation criteria required by the
Act;
1.2.3. notice of the licence conditions currently
envisaged by the Minister for Posts, Telecommunications and Broadcasting
("Minister");
1.2.4. the form in which applications must be submitted;
and
1.2.5. notice of certain process information.
2. THE SERVICE
The following information is provided, as required by
section 34(2)(b)(ii) of the Act, regarding the manner in which it is contemplated that the
mobile cellular telecommunication service will be provided.
2.1. Technology
While certain technologies are to be preferred, a
particular mobile cellular telecommunication service technology is not mandated. Preferred
technologies are those which allow a wide choice of customer equipment, are widely
accepted in other national markets, are electro-magnetically compatible with existing
frequency spectrum users and are capable of transition to the provision of third
generation services.
2.2. Frequency Assignment
While there is no specific limitation on the frequencies
to be assigned, it is unlikely that more than 2 x 10 MHZ of frequency spectrum will be
assigned to the successful applicant.
2.3. Coverage
It is expected that service coverage must provide for a
significant proportion of South Africans, including those in currently under-serviced
areas, particularly areas in which previously disadvantaged communities and rural
communities are located.
2.4. Services
It is expected that the mobile cellular
telecommunication service to be offered must be comprehensive and will include at a
minimum, mobile voice telephone services, data services, emergency services, directory
services and operator-assisted services, on a non-discriminatory basis.
1. EVALUATION CRITERIA
The evaluation criteria to be applied by the South
African Telecommunications Regulatory Authority ("the Authority") when
considering applications will flow from the provisions of the Act. In general, the objects
of the Act set out in section 2 thereof will be important. Specifically, section 35(3) of
the Act provides that in the consideration of applications to provide a telecommunication
service referred to in section 34(2) of the Act, which includes mobile cellular
telecommunication service, due regard shall be given to applications by persons from
historically disadvantaged groups.
1. LICENCE CONDITIONS CURRENTLY ENVISAGED BY THE
MINISTER
1.1. The following licence conditions are those
currently envisaged by the Minister. The Minister, however, will consider any conditions
suggested by the Authority if and when the Authority makes a recommendation to the
Minister to grant an application in terms of section 35(2)(b)(i) read with section 35(4)
of the Act.
1.1.1. A licence period of validity of 15 years.
1.1.2. Telecommunication service licence fees (not
including frequency licence fees), being:
1.1.2.1. a once-off fixed telecommunication service
licence fee of R100 000 000,00 (one hundred million rand), payable over the period of the
licence with interest; and
1.1.2.2. an annual variable telecommunication service
licence fee of one percent of net operating income, reviewable by the Authority.
1.1.3. A limitation on the transfer of the licence and
on changes of ownership or control of more than ten percent of the telecommunication
service licensee during the period in which the once-off fixed telecommunication service
licence fee has not been paid in full (including any interest thereon).
1.1.4. A limitation on the transfer of the licence and
on changes of ownership or control which result in a change of the ownership or control of
the telecommunication service licensee held by persons from historically disadvantaged
groups.
1.1.5. A performance guarantee in the amount of amount
of R50 000 000,00 (fifty million rand) in respect of certain commitments, namely:
1.1.5.1. commitments related to geographic and population
coverage;
1.1.5.2. commitments related to universal access and
universal service obligations;
1.1.5.3. commitments related to empowerment; and
1.1.5.4. commitments related to economic development.
1.2. In terms of section 37(2)(d) of the Act, the
licence shall contain a condition prohibiting the mobile cellular telecommunication
service, until a date to be fixed by the Minister by notice in the Government Gazette,
from utilising any fixed lines which may be required for the provision of the service,
other than fixed lines made available by Telkom or any other person providing a public
switched telecommunication service, subject to the Act, in particular section 44 of the
Act.
2. THE APPLICATION
2.1. The structure of the application submitted to the
Authority in terms of the Invitation to Apply shall be as follows:
2.1.1. The information required by clause 4.1.5 of the
Invitation to Apply;
2.1.2. The Application Form and Annexures thereto; and
2.1.3. An affidavit stating that the application is the
true and complete application of the applicant, signed by at least the same two persons
who sign the covering letter in terms of clause 4.1.5 of the Invitation to Apply.
2.2. The Application Form to be followed is published
herewith.
2.3. Applicants are encouraged to be brief in submitting
relevant information unless otherwise requested and applicants are discouraged from
submitting superfluous information.
2.4. In preparing applications, regard should be had to,
among other matters, the enquiry initiated by the Authority with regard to the economic
feasibility of the provision of more than two mobile cellular telecommunication service
licenses in Notice 563 of 1998 in Government Gazette 18799 dated 30 March 1998 and notice
of findings in Notice 1526 of 1998 in Government Gazette 19115 dated 31 July 1998.
2.5. In submitting information regarding ownership and
control, regard should be had to, among other matters,
2.5.1. the Act, in particular sections 35(2) and 35(3)
thereof;
2.5.2. the enquiry initiated by the Authority with
regard to ownership and control of telecommunication service licences in Notice 1322 of
1998 in Government Gazette 18927 dated 10 July 1998 and notice of findings in Notice 313
of 1999 in Government Gazette 19805 dated 26 February 1999; and
2.5.3. any regulations or draft regulations published by
the Authority before the deadline for submission of applications.
2.6. In submitting information
regarding charges for services, regard should be had to, among other matters,
2.6.1. the Act, in particular section 45 thereof; and
2.6.2. any regulations or draft regulations published by
the Authority before the deadline for submission of applications.
2.7. In submitting information regarding financial
projections, regard should be had to, among other matters,
2.7.1. the documents referred to in 6 above;
2.7.2. the enquiry initiated by the Authority with
regard to application fees and licence fees in Notice 2691 of 1998 in Government Gazette
19436 dated 30 October 1998;
2.7.3. the Ministerial Policy Direction on Contributions
to the Universal Service Fund published in Notice 775 of 1997 in Government Gazette 17984
dated 7 May 1997;
2.7.4. the draft regulations published with regard to
contributions to the Universal Service Fund in Notice 2003 of 1997 in Government Gazette
18579 dated 19 December 1997;
2.7.5. the Ministerial Policy Direction on Contributions
to the Human Resources Fund published in Notice 774 of 1997 in Government Gazette 17984
dated 7 May 1997; and
2.7.6. the enquiry initiated by the Authority with
regard to establishment of the Human Resources Fund in Notice 1927 of 1998 in Government
Gazette 19217 dated 3 September 1998.
2.8. In submitting information regarding frequency
requirements, regard should be had to, among other matters,
2.8.1. the Act, in particular Chapter IV thereof;
2.8.2. the following documents published in the
Government Gazette regarding the frequency band plan -
2.8.2.1. Notice 18 of 1996 in Government Gazette 17701
dated 27 December 1996 regarding Project SABRE, version 1.61;
2.8.2.2. Notice 759 of 1997 in Government Gazette 17983
dated 6 May 1997 regarding Project SABRE, version 2;
2.8.2.3. Notice 740 of 1998 in Government Gazette 18883
dated 30 April 1998 regarding Project SABRE - 2, Notice of Intention to Develop a New Band
Plan (3 GHz to 70 GHz);
2.8.2.4. Notice 1334 of 1998 in Government Gazette 19062
dated 10 July 1998, an erratum of Notice 759 of 1997;
2.8.2.5. Notice 1535 of 1998 in Government Gazette 19120
dated 31 July 1998, concerning SABRE - 2, Notice In Respect of Future Spectrum Developments
- Project SABRE - 2;
2.8.2.6. Notice 2358 of 1998 in Government Gazette 19343
dated 9 October 1998, Notice of Intention to Revise the Band Plan for 10.7 GHz to 11.7 GHz;
and
2.8.2.7. Notice 157 of 1999 in Government Gazette 19750
dated 9 February 1999, Addendum Draft Broadcasting Frequency Plan, by the Independent
Broadcasting Authority.
2.9. In submitting information regarding interconnection
and facilities leasing, regard should be had to, among other matters,
2.9.1. the Act, in particular section 43 thereof;
2.9.2. the Ministerial Determination on Interconnection
Guidelines published in Notice 771 of 1997 in Government Gazette 17984 dated 7 May 1997;
2.9.3. the enquiry initiated by the Authority with
regard to interconnection and facilities leasing guidelines on the form and content of
interconnection and facilities leasing agreements in Notice 1683 of 1998 in Government
Gazette 19159 dated 19 August 1998; and
2.9.4. the draft regulations published with regard to
interconnection and facilities leasing guidelines on the form and content of
interconnection and facilities leasing agreements in Notice 168 of 1999 in Government
Gazette 19764 dated 12 February 1999.
2.10. In submitting information regarding number
portability, regard shall be had to, among other matters, a request for comment by the
Authority on a draft discussion paper on the future of telecommunications numbering in
South Africa in Notice 198 of 1999 in Government Gazette 19786 dated 20 February 1999.
2.11. In submitting information regarding universal
access and universal service obligations, regard should be had to, among other matters,
2.11.1. the Act, in particular Chapters VII and VIII and
section 2 thereof;
2.11.2. a request for comment by the Authority on a
draft report of a study to determine the categories of needy people to benefit from the
Universal Service Fund in Notice 1941 of 1997 in Government Gazette 18527 dated 5 December
1997;
2.11.3. a request for comment by the Universal Service
Agency on a discussion document concerning the definition of universal service and
universal access in Notice 2601 of 1998 in Government Gazette 19397 dated 22 October 1998;
2.11.4. the licence of Telkom SA Limited to provide
telecommunication services in terms of section 36 of the Act published in Notice 768 of
1997 in Government Gazette 17984 dated 7 May 1997; and
2.11.5. the licence of Vodacom Group (Proprietary)
Limited and Mobile Telephone Networks (Proprietary) Limited to provide cellular
telecommunication services published in Notice 1078 of 1993 in Government Gazette 15232
dated 29 October 1993.
3. PROCESS INFORMATION
3.1. Interested persons may submit questions of
clarification concerning this document, the Application Form and the Invitation to Apply
to the Minister which shall be hand delivered to the Minister by no later than three weeks
from the release of this document, care of The Project Manager, Invitation to Apply for
One Mobile Cellular Telecommunication Service Licence, Ministry for Posts,
Telecommunications and Broadcasting, Room 212, Nkululeko House, iParioli Office Park, 399
Duncan Street, Hatfield, Pretoria. Persons are encouraged to submit questions of
clarification as soon as possible. Questions of clarification about this document, the
Application Form or the Invitation to Apply may not be directed to the Authority.
3.2. At any time before two weeks after the deadline
mentioned in 6.1 above, the Minister will make available documents setting out questions
which the Minister considers necessary to answer in order to ensure the fairness of the
process, together with the answers to such questions. Notice of such documents will be
published in the Government Gazette.
3.3. Neither the Minister, the Department of
Communications nor the Authority will entertain ex parte contacts with regard to
this document, the Application Form, the Invitation to Apply or any other matter related
to the proceedings for applications for one mobile cellular telecommunication service
licence initiated by the Invitation to Apply. Questions about any other matter related to
the proceedings for applications for one mobile cellular telecommunication service licence
initiated by the Invitation to Apply should not be directed to the Minister, but to the
Authority in accordance with regulations prescribed by the Authority.
3.4. After the submission of applications in terms of
the Invitation to Apply, the Authority will consider all applications in terms of the Act
and regulations, in particular in terms of section 34 and section 35 of the Act.
Thereafter, in terms of section 35(2)(b)(i), the Authority may either refuse an
application or make a recommendation to the Minister that the Minister grant the
application conditionally and suggest conditions for the Minister to impose.
3.5. Thereafter, in terms of section 35(2)(b)(i) read
with section 35(4) of the Act, the Minister may either refuse the application recommended
by the Authority to be granted, grant the application and impose the conditions suggested
by the Authority, grant the application and impose other conditions or grant the
application unconditionally.
3.6. If the Minister grants the application, the
Authority must issue a licence in terms of section 35(5) of the Act. In such event, the
licensee will then be required to apply to the Authority in terms of section 30(3)(b) of
the Act for a frequency licence.
J Naidoo
Minister for Posts, Telecommunications and Broadcasting
5 March 1999
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