Satellite radio service WorldSpace is in talks with black economic
empowerment (BEE) companies in an effort to comply with local licence
requirements, writes Thabiso Mochiko in Business Report.

The Independent Communications Authority of SA (Icasa) started holding hearings on satellite broadcasting May 28. Nasdaq-listed Worldspace is the only one of 18 applicants that intends offering satellite radio.

Although the firm already offers services in the country, it does not meet the requirements of the Electronic Communications Act (ECA) or Icasa's position paper on satellite broadcasting, which requires 30 percent BEE ownership.

The act stipulates that a foreign company should not own 80 percent of a local broadcasting entity and no more than 20 percent of the directors of a commercial broadcasting licensee may be foreigners.

The managing director of WorldSpace Southern Africa , Hamza Farooqui, said the group had not decided whether it would sell equity or equity equivalents, as discussions with partners were still under way.

The BEE conditions are not clear; Icasa's position paper clashes with the department of trade and industry's codes of good practice, which provide for multinationals to use equity alternatives. The information and communications technology (ICT) charter, which calls for 25.1 percent equity ownership, is expected to be aligned with the codes.

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