Out with the old, in with the new – exploring the amendments to the Electronic and Postal Communications (Licensing) Regulations | Dentons

In recent months, Tanzania has published amendments to the Electronic and Postal Communications (Licensing) Regulations that introduce new licensing categories and restructure existing ones. This article highlights the amendments introduced in the Electronic and Postal Communications (Licensing) (Amendments) Regulations of 2022 (the Regulations) and the compliance measures that apply thereunder.

The Tanzania Communications Regulatory Authority (the TCRA) is mandated through the Electronic and Postal Communications Act CAP 306 Revised Edition 2022 and the Regulations to determine licence applications and generally regulate licensees.

Out with the old – removal of the licence category for selling electronic communication equipment

The licence for selling electronic communication equipment applied to those selling electronic communication equipment on a retail basis. Such licensees had to ensure the equipment was type approved and of a quality approved by the TCRA. Upon application, there was a prescribed fee, and the licence was valid for up to three (3) years, subject to renewal. Following the amendments to the Regulations, sellers of electronic communication equipment no longer need a licence to conduct their activities. The rationale behind this is that electronic communication equipment would have already met compliance requirements by having the importers and distributors licensed accordingly and the equipment type approved by the TCRA. As a result, sellers will be able to recover costs by no longer having to pay for such a licence and the TCRA can focus its regulatory oversight on electronic communication equipment at source.

In with the new – licence categories and types of facility

The Regulations introduce the following licence categories:

  • Application Services (e-Commerce) Licence – this new category of a class licence is issued to service platforms and covers aggregation or integration of services, transactions or business for other service providers, sellers, buyers, or consumers of regulated or unregulated services. Prior to the Regulations, such activities fell within the Application Services Licence, but by sub-categorising the licence, small-scale e-commerce platforms that engage with consumers on a daily basis can also be regulated without the onerous licensing requirements of individual type licences that are targeted more towards large-scale application services. More importantly, customers that utilise such platforms can seek recourse through the TCRA and therefore be protected. The TCRA has extended its regulatory reach to e-commerce platforms regardless of whether the product or service being traded relates to electronic communication equipment. As a separate licence category, this licence has its own application fee, initial licence fee, renewal fee and annual licence fee and subsists for a period of three (3) years.
  • Installation and Maintenance Licence – this licence has always been sub-categorised into either a Class A or Class B licence based on the type of equipment being installed or maintained. However, the lack of definition of these classes left room for inconsistency in its application. The Regulations now clearly stipulate what exactly falls under Class A and Class B as follows:
  1. Class A Licence – for installation and maintenance of commercial electronic communication infrastructure and equipment (PBX, fibre, cabling, transmitters by towers and related infrastructure).
  2. Class B Licence – for installation and maintenance of end-user electronic communication equipment and infrastructure (cell phones, transceiver equipment and related small electronic communication appliances).
  • Landing Station Licence – this licence will cover licensees that operate or own a site for Submarine Cable Terminating Equipment (SCTE) for domestic and/or international interconnection. While the wording used in the Regulations refers to a landing station licence, in practice the TCRA intends to issue landing right authorisations. This means authorisations for third parties to interconnect with licensees without establishing a local presence. Nonetheless, network facility licensees that require such submarine cabling facilities may do so by applying to the TCRA to extend their facilities. For this reason, the original definition of the network facilities international market segment licence has not been amended to remove submarine cabling facilities. Landing right authorisations are now subject to a prescribed fee and those simply landing their equipment at the station for interconnection can do so under the Regulations.
  • Special Content – this category specifically covers a television channel or radio station that provides specific formal educational content for different levels, from nursery to tertiary and higher learning institutions. Quite reasonably, such licensees will be subject to lower fees compared with other content provider licensees.
  • Public Data Centre – in line with the developments in data preservation, the Regulations introduce provisions on data centres as network facility types regulated by the TCRA and subject to prescribed fees provided for under the Regulations. The TCRA has supplemented this new licence by publishing Minimum Technical Specifications for Data Centre Document No. TCRA/TSA013 of March 2022 (the Technical Specifications), which are available on the TCRA official website. While the Regulations simply introduce the new licence category facility, the Technical Specifications define a public data centre and distinguish the tiers and therefore close the obvious gaps in the Regulations. Any person that operates or owns a data centre that provides services for co-location or co-hosting of customer’s network(s), servers and storage equipment must obtain the Public Data Centre licence. Note that the international standards maintained by the Uptime Institute also apply to Tanzania.

It is also important to note that the following licence categories have been included in the Class licence category: content service of subscription, community broadcasting services and the Application Services (e-Commerce) Licence. This means that these licences are smaller category licences with a less onerous application process.

Other compliance measures to note:

  • Change of address: under the Regulations, the TCRA not only requires content service licensees to provide prior notice of change of address, but also to conduct an inspection at the new address prior to commencing operations.
  • Prescribed currency for fee payments: previously the TCRA allowed for fee payments prescribed in United States Dollars (USD) to be paid in the Tanzanian Shillings (TZS) equivalent, but the Regulations have removed this as an option. Now currency stipulated in the Regulations must be adhered to and there is no longer an option of interchanging the same. While large-scale individual licence categories such as network facility, network service and application service licences, the radio communication station and frequency spectrum, and V-SAT have retained USD as the prescribed currency, the following licence categories have switched to TZS: installation and maintenance, importation, and distribution of electronic communication equipment; content broadcasting; radio spectrum fees for broadcasting networks; and postal and courier services. All the new licence categories have been assigned TZS as the prescribed currency.
  • Change in shareholding structure fees: notably the Regulations have also prescribed that, where a transfer of shares involves a change in majority shareholders, the transfer must be processed in accordance with the procedure of issuing an entirely new licence. Accordingly, the transfer of licence fee is no longer 1% of the sale price and such a transaction will be subject to the change in shareholding structure fees as follows:
  1. network facilities, network services and application services – US$1,500;
  2. content services – US$500;
  3. other licences – US$200.
  • These structured fees have clarified the licensee’s obligations in relation to share transfers.
  • Renewal: a licensee that intends to renew its licence must now go beyond simply paying a renewal fee. Under the new Regulations, payment of the renewal fee is not sufficient to renew a licence and does not automatically translate to a renewal. Now the TCRA will consider a licence for renewal by reviewing, among other things, compliance with licence obligations during the period of the licence and quality of services rendered.
  • Type approval: importers and distributors of electronic communication equipment must now ensure electronic communication equipment is type approved. The Regulations have shifted this responsibility from retailers, dealers and end-users not solely using such equipment for personal use.

Closing remarks

It is evident that the Regulations have introduced new conditions which licensees must familiarise themselves with to avoid contravening the same.

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