Starlink regulatory talks in South Africa stalls as Elon Musk and Donald Trump’s raise inquiry

Ongoing talks to launch Starlink in South Africa have hit another delay after Elon Musk and U.S. President Donald Trump seek public backing against laws aimed at redressing the racial inequality wrought by apartheid.

For months, Elon Musk has been seeking regulatory approval to launch Starlink in South Africa which has been objected to by the country’s Black Economic Empowerment (BEE) policy. The Starlink owner has accused the government of having “openly racist ownership laws.” 

The government has since stood on grounds not to back down at the expense of the nation’s constitution and values amidst its eagerness to attract as much foreign investment as possible.

“If a leading business figure like Elon Musk harbors the kind of unprogressive, racist views that we’ve witnessed and the peddling of lies that we’ve been confronted with, then we’re not going to pursue having his investments,” Presidency spokesman Vincent Magwenya said on Thursday.

In what turned out as another off point, Donald Trump, Elon Musk’s ally, issued an executive order slamming another South African regulation last week. 

South African law gives the government the power to take land for a public purpose, similar to eminent domain laws in the US. Trump, however, falsely claimed that human rights violations are being committed under the legislation and the government is seizing land from White farmers.

Responding to the order, South African President Cyril Ramaphosa has said Trump misunderstood the expropriation law. He noted that the country won’t be “bullied” by the order and that the presidency has spoken to Musk about “issues of misinformation and distortions,” the week before.

Amidst the development, negotiations between Starlink and the Independent Communications Authority of South Africa (Icasa) have now stalled until the dispute between the US and South Africa calms down, to return to a possible deal at a later stage.

The Black Economic Empowerment (BEE)

The South African BEE rule mandates that companies must allocate 30 per cent of their shareholding to historically disadvantaged groups. The legislation was introduced by the government after the end of apartheid in 1994 to give South Africa’s Black majority a greater stake in the economy from which they were excluded during White-minority rule.

SpaceX’s Starlink has refused to comply with the country’s BEE (Black Economic Empowerment). However Icasa claimed that it has not received any application for a license from Starlink, nor has the company approached the Department of Communication and Digital Technologies (DCDT).

As the policy caused more dispute, the satellite internet company had previously suggested setting aside an equity equivalent to the ownership program to assist South Africans. Starlink offered to install 8,000 satellite kits in rural schools across the country as part of an equity equivalent.

The country’s Department of Trade and Industry had yet to agree to that alternative, according to reports.

Starlink’s technology, which employs a constellation of low-Earth orbit satellites, would be a potential game-changer for South African users who have historically faced expensive, low-quality, and unreliable internet alternatives. 

According to a 2023 survey by Statistics South Africa, only 1.7 per cent of rural households in the country have access to the internet.

Also Read: Starlink urges South Africa to waive 30% Black Economic Empowerment policy.

Also, in its efforts to obtain regulatory approval, Starlink made a move to participate in the public hearings called by the country communications regulator which were held on February 5 and 6. The hearing will focus on a proposed new licensing framework for satellite services which includes a decision on whether to keep the BEE policy or not. 

SpaceX in a submission has told the Icasa that it ought to rethink the rules requiring 30 per cent shareholding by “historically disadvantaged” groups.

The satellite company controlled by South African-born billionaire Elon Musk related that all processes have been made to launch in the country aside from the registration framework emanating from the required network and services licenses delaying its launch.  

“Under the current South African regulatory system, companies providing services directly to end users must hold I-ECNS (network) and I-ECS (service) licenses, which require at least 30 per cent shareholding by historically disadvantaged groups,” SpaceX wrote in its submission to Icasa.

Stressing its position in its submission, Starlink said most foreign satellite operators, particularly those with direct-to-consumer business models, have global policies that prevent local shareholding, thus excluding them from the South African market.

“By aligning the licensing and ownership regulations with the ICT sector code – which recognizes equity equivalent programs as an alternative to local shareholding – Icasa could remove a significant barrier to foreign satellite operators. This would not only increase foreign investment in South Africa but would also create broader industry benefits, supporting innovation, competition, and long-term growth,” Starlink proposed.

For reasons such as short notice and the difficulty of Zoom’s timezone, SpaceX failed to appear at the Icasa session last week while several other satellite operators appeared, including Globalstar Inc. and Sateliot.

What the South African government is saying on BEE policy

The South African government has noted that other large telecommunications companies have complied with the BEE policy. This includes MTN and Vodacom who are among the biggest mobile network operators in Africa. 

While SpaceX failed to attend the Icasa session in person, the satellite company decided to rely on its written submission, according to close sources. 

According to Icasa, the company’s written submission still stood and a committee would consider all submissions where the findings document would be compiled and released on April 1, 2025.

South African Communications and Digital Technologies Minister Solly Malatsi said that it is working on a regulatory and licensing framework for satellite internet providers to play as operators.