South Africa has moved to relax ownership rules in its communications sector, a shift that could clear the way for Elon Musk’s Starlink and other foreign-owned satellite internet firms to operate in the country.
The change, announced on Friday by Communications Minister Solly Malatsi, removes the requirement for foreign companies to sell 30% of their local equity to Black or other non-white South Africans to obtain operating licences.
New route to meet empowerment rules
Under the new policy directive, published in a government gazette, foreign companies can now meet South Africa’s affirmative action requirements through so-called “equity equivalent” programmes.
These include investments such as skills development, training initiatives or other projects that support groups disadvantaged under apartheid.
This alternative already exists for foreign-owned firms in some other sectors of the South African economy, but its extension to communications marks a significant policy shift.
It means companies that are unable or unwilling to give up local ownership stakes can still qualify to operate, as long as they contribute in other measurable ways.
Starlink and Musk’s criticism
The move follows public criticism from Elon Musk, who was born in South Africa. Earlier this year, the billionaire described the country’s ownership requirements as “openly racist” and claimed Starlink was barred from operating because he is not Black. He made the comments on social media in March.
Starlink is a subsidiary of Musk’s aerospace company SpaceX and provides low-orbit satellite internet services. The company says it already operates in more than a dozen African countries, including several that border South Africa.
South Africa’s ownership rules form part of its Broad-Based Black Economic Empowerment framework, a central policy aimed at correcting the deep economic inequalities created by decades of white minority rule under apartheid. While supporters see the policy as essential for redress, critics argue it can deter foreign investment.
Rural internet access is a key factor
Announcing the policy change, Minister Malatsi said satellite services like Starlink could play an important role in expanding high-speed internet access, particularly in rural and underserved areas of the country where connectivity remains limited.
The policy shift also comes amid heightened international scrutiny of South Africa’s domestic policies. U.S. President Donald Trump has previously criticised the country’s affirmative action laws, portraying them as discriminatory against white citizens.
For now, the revised rules open the door for Starlink and other foreign providers to formally enter South Africa’s communications market, while keeping the government’s broader empowerment goals in place through alternative forms of investment.