Elom Musk alleges bribery demands behind Starlink’s South Africa licence delay

Key topics:Musk alleges Starlink licence bribery demands in South AfricaDispute over B-BBEE laws blocking Starlink market entryStarlink proposes EEIPs and rural connectivity investment.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Hanno Labuschagne.Elon Musk has alleged his satellite Internet company, Starlink, was given the opportunity to bribe its way to a telecoms licence in South Africa by pretending a black person ran the company’s local entity.In an X post on Sunday, which Musk pinned to the top of his profile, the world’s richest man again argued the main reason Starlink could not launch in his birth country was that he was not black.“South Africa won’t allow Starlink to be licensed, even though I was born there, simply because I am not black,” Musk said.“We were offered many times the opportunity to bribe our way to a license by pretending that a black guy runs Starlink SA, but I have refused to do so on principle,” he said.Musk said that racism should not be rewarded, regardless of which race it is applied to. “Shame on the racist politicians in South Africa,” he said.“They should be shown no respect whatsoever anywhere in the world and shunned for being unashamedly racist!”Musk’s statements came shortly after he responded to another post by Department of International Relations and Cooperation public diplomacy head Clayson Monyela.Monyela taunted Musk by comparing the SpaceX CEO to a small child in a TikTok video at a Spur being unimpressed with his ice cream and restaurant staff singing for his birthday.“Elon Musk watching the more than 600 USA companies in South Africa, complying with South African laws and thriving. Zero drama!” Monyela said.Musk said Monyela should “stop being such a f—ing racist, you a–hole.” Another commentator responding to Musk’s post — Michael de Villiers — called Musk a “blatant liar” over his claims.“There are over 500 American companies operating in South Africa, many of them led by white executives,” he said. “This isn’t about facts, it’s about smearing South Africa for your own benefit.”.Starlink regulatory team wants to comply with B-BBEE.While Musk has frequently spoken out against South Africa’s black economic empowerment laws, Starlink’s regulatory team has formally and repeatedly maintained that it supports the policy.However, it argues that the Independent Communications Authority of South Africa’s (ICASA’s) regulations currently do not align with the broad-based black economic empowerment (B-BBEE).The company has highlighted that other sectors — including technology and mining — allow foreign companies to operate in South Africa without being 30% owned by historically disadvantaged groups.Instead, these companies can use Equity Equivalent Investment Programmes (EEIPs) to contribute to transformation.EEIPS require that a company invest 25% of its local operations’ value annually into projects advancing transformation objectives, typically investments into sector-specific skills training or infrastructure.Starlink has even launched a dedicated web page to address what it calls “myths” about its planned operations in South Africa to address this issue.“Starlink supports South Africa’s transformation objectives and proposes to meet them through Equity EEIPs, a lawful and well-established B-BBEE mechanism,” it said.“EEIPs are explicitly recognised in the ICT Sector Code and in multiple other B-BBEE sector codes. However, the Icasa licensing regulations are anomalous and don’t recognise EEIPs.”Starlink wants to provide free hardware and subscriptions valued at R500 million to support free Internet at 5,000 rural schools in South Africa.It has also committed to partnering with local telecoms companies on the rollout and installation of the equipment.The company argues this would be significantly more impactful than equity divestment, which it said, “often benefits only a small number of individuals.”“Starlink South Africa will partner with local companies, large and small, to increase access and create employment opportunities,” it said.“In every market where Starlink operates, a local support ecosystem has developed, creating jobs in installation, sales, and service,” it said.Communications minister Solly Malatsi has directed ICASA to incorporate EEIPs into its licensing regulations to align them with B-BBEE and the ICT Sector Code.That instruction came after the Department of Communications and Digital Technologies undertook a public consultation for the incorporation of EEIPs in the telecoms sector, following lobbying by Starlink.The department required several months to process submissions from roughly 19,000 people and entities. 15,000 were deemed substantive, and 90% of those supported the mechanism..*This article was originally published by My Broadband and has been republished with permission.

Elom Musk alleges bribery demands behind Starlink’s South Africa licence delay

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