Mobile Telephone Networks (Pty) Ltd v Chairperson of the Independent Communications Authority of South Africa and Others, In Re: Vodacom (Pty) Ltd v Chairperson of the Independent Communications Authority of South Africa and Others (2014/04699, 2014/6710) [2014] ZAGPJHC 51; [2014] 3 All SA 171 (GJ) (31 March 2014)

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[2014] ZAGPJHC 51
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Mobile Telephone Networks (Pty) Ltd v Chairperson of the Independent Communications Authority of South Africa and Others, In Re: Vodacom (Pty) Ltd v Chairperson of the Independent Communications Authority of South Africa and Others (2014/04699, 2014/6710) [2014] ZAGPJHC 51; [2014] 3 All SA 171 (GJ) (31 March 2014)

Links to summary

REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
LOCAL DIVISION, JOHANNESBURG)
REPORTABLE
OF
INTEREST TO OTHER JUDGES
CASE
NO:2014/04699
In
the matter between:
MOBILE
TELEPHONE NETWORKS (PTY)
LTD
Applicant
and
THE CHAIRPERSON OF THE
INDEPENDENT
COMMUNICATIONS
AUTHORITY OF SOUTH AFRICA
AND 30 OTHERS
Respondents
CASE NO: 2014/6710
And in the matter
between:
VODACOM (PTY)
LTD
Applicant
and
THE CHAIRPERSON OF THE
INDEPENDENT
COMMUNICATIONS
AUTHORITY OF SOUTH AFRICA
AND 38 OTHERS
JUDGMENT
MAYAT
J
INTRODUCTION
[1]
On the 12
th
of February 2014, Mobile Telephone Networks
(Pty) Ltd (“MTN”) launched an urgent application
challenging regulations
made by the Independent Communications
Authority of South Africa (“ICASA”) on the 4
th
of February 2014 in terms of the Electronic Communications Act 36 of
2005 (“the ECA”).  Thereafter, on the 25
th
of February 2014, Vodacom (Pty) Ltd (“Vodacom”) launched
a separate application, also challenging the said regulations.

Pursuant to an order by this court consolidating the two
applications, both matters are now before this court by way of
urgency.
[2]
The impugned regulations govern the wholesale termination rates,
which mobile network operators charge other mobile network
operators
to receive calls on their respective mobile networks. In effect, the
impugned regulations prescribe maximum wholesale
termination rates
for MTN and Vodacom, which are lower than the maximum wholesale
termination rates, which can be charged by smaller
operators,
including Cell C (Pty) Ltd (“Cell C”) and the mobile
division of Telkom SA Ltd (“Telkom Mobile”).
[3]
Whilst the respondents in the consolidated applications include
ICASA, Cell C and Telkom Mobile as well as some 38 interested
and
affected parties, the said consolidated applications are opposed in
these proceedings by ICASA, Cell C and Telkom Mobile only.
RELIEF
SOUGHT
[4]
Both MTN and Vodacom initially sought certain interim relief set out
in Part A of their respective notices of motion by way
of urgency,
pending the determination of applications for judicial review
incorporated in Part B of their respective notices of
motion.
[5]
After ICASA filed an answering affidavit in response to both
applications in this matter, MTN indicated in its replying affidavit

and subsequently also argued at the hearing of this matter that it
now sought, in the first instance, the final relief incorporated
in
Part B of its notice of motion.  The said final relief was based
upon an application for judicial review in terms of rule
53 of the
Uniform Rules of Court. In these circumstances, the primary relief,
which MTN now seeks, is a final order reviewing and
setting aside
regulations, which come into effect on the 1
st
of April
2014. In the alternative, MTN seeks the interim relief set out in
Part A of its notice of motion, pending the determination
of review
proceedings in terms of rule 53 pertaining to the impugned
regulations, as set out in Part B of its notice of motion.
[6]
Similarly, Vodacom initially sought interim relief in terms of Part A
of its notice of motion, pending the determination of
an application
in terms of rule 53 for judicial review set out in Part B of its
notice of motion. However, during the course of
the hearing of this
matter, Vodacom was granted leave to amend its notice of motion.
Vodacom accordingly also now seeks in the
first instance, in the
context of the present urgent hearing, an order reviewing and setting
aside regulations enacted by ICASA.
In the alternative, Vodacom also
seeks interim relief pending the determination of review proceedings
pertaining to the impugned
regulations.
[7]
For the reasons set out in this judgment and the chronology of
certain events after the 4
th
of February 2012, also set
out in this judgment, this matter was manifestly urgent and urgency
was accordingly not in issue before
me. I am also satisfied on the
basis of the said chronology of events that each of the two
consolidated applications warrants urgent
adjudication before the 1
st
of April 2014, prior to the impugned regulations coming into effect.
As such, I advised the parties at the close of the hearing
at
approximately 13h00 on Thursday, the 27
th
of March 2014,
that my judgment in this matter would be handed down at 15h00 on
Monday, the 31
st
of March 2014.
RELEVANT
STATUTORY AND REGULATORY FRAMEWORK
Independent
Communications Authority Act 13 of 2000
[8]
ICASA is a juristic entity established in terms of section 3 of the
Independent Communications Authority Act 13 of 2000 (“the
ICASA
Act”), which must exercise the powers conferred upon it and
perform the duties imposed upon it in terms of the ICASA
Act, the
underlying statutes and any other applicable law.
[1]
ICASA is also an organ of state as defined in section 239 of the
Constitution.
Electronic
Communications Act, 36 of 2005
and Regulations in terms thereof
[9]
The stated primary object of the ECA is to provide for the regulation
of electronic communications in the Republic of South
Africa in the
public interest.
[2]
For
the purposes of the said primary object, the ECA also stipulates a
number of ancillary objectives, premised upon the
public interest.
Thus, for example, the ancillary objectives include inter alia the
promotion of the interests of consumers with
respect to the “price,
quality and the variety of electronic communication services”
[3]
as well as the promotion of
the interests of consumers with respect to “price, quality and
the variety of electronic communication
services”.
[4]
[10]
Section 4(1)
of the ECA permits ICASA to make regulations with
respect to any matter in terms of the ECA or related legislation. In
terms of
section 4(4)
of the ECA, ICASA “must” not less
than 30 days before any regulation is made, publish such regulation
in the Government
Gazette, together with a notice declaring ICASA’s
intention to make such regulation, and inviting interested parties to
make
written representations in this respect. However,
section
4(7)(b)
further provides that the provisions of subsection 4 do not
apply in respect of any regulation, which the public interest
requires
should be made without delay.
[11]
Chapter 7 of the ECA deals with “interconnection” and
section 37
in that chapter deals with the obligations to interconnect
imposed on licensed mobile operators in terms of the ECA.
Specifically,
subsection 37(1) envisages interconnection agreements
between licensed operators and subsection 37(6) provides that any
such interconnection
agreement concluded by the licensee in terms of
the ECA –
“
must unless
otherwise requested by the party seeking interconnection, be
non-discriminatory as among  comparable types of interconnection

and not be of a lower technical standard and quality than the
technical standard and quality provided by such licensee to itself
or
to an affiliate.”
[12]
Section 67
of the ECA relates to competition matters and empowers
ICASA inter alia to direct a licensee in terms of the ECA to refrain
from
engaging in any act, which is likely substantially to prevent or
lessen competition.
[5]
Thus,
ICASA is also empowered to prescribe regulations setting out actions,
which prevent or lessen competition by giving undue
preference or
causing undue discrimination against another licensee providing the
same service.
[6]
Subsection
67(4) of the ECA specifically provides that ICASA “must”
prescribe regulations with a view to defining
the relevant markets
and market segments, as applicable, with a view to imposing
pro-competitive conditions upon licensees having
significant market
power.  To this end, it is further provided that the regulations
in terms of subsection 67(4) must, amongst
other things:
- define and identify the
retail or wholesale markets or market segments in cases which it
intends to impose pro-competitive measures
on the basis that such
markets or market segments have “ineffective competition”;
[7]
and
- set out the methodology
to be used to determine the effectiveness of competition in such
markets or market segments, subject to
subsection 67(8), which
applies when ICASA undertakes a review of market determinations on
the basis of an earlier analysis.
[8]
[13]
Subsection 67(7) sets out a number of pro-competitive terms and
conditions, which may be incorporated in regulations made by
ICASA in
terms of
section 67.
It is specifically provided in this respect that
the stated terms and conditions are not exhaustive. These terms and
conditions
include inter alia an obligation to act fairly and
reasonably by responding to requests for access, provisioning of
services and
interconnection
[9]
;
an obligation to maintain separation for accounting purposes between
different matters relating to access and interconnection
[10]
;
a requirement relating to accounting methods to be used in
maintaining separation of accounts
[11]
;
and price controls relating inter alia to the provision of wholesale
and retail interconnection rates.
[12]
[14]
As already indicated, subsection 67(8)(a) relates to the review of
pro-competitive conditions by ICASA and provides that where
ICASA
undertakes a review of pro-competitive conditions imposed upon one or
more licensees, then in such circumstances ICASA “must”
- review the
determinations made on the basis of earlier analysis;
[13]
and
- decide whether to
modify the pro-competitive conditions set by reference to an earlier
market determination.
[14]
Subsection 67(8)(c)
further provides that pursuant to such review, if ICASA determines
that the licensee to whom pro-competitive
conditions apply continues
to possess significant market power in that market or market segment,
but that as a result of changes
in the competitive nature of such
market or market segment, the pro-competitive conditions are no
longer “proportional”
in accordance with subsection (7),
then ICASA “must” modify the applicable pro-competitive
conditions applied to that
licensee with a view to ensuring
“proportionality”.
[15]
On the 29
th
of October 2010, ICASA published “Call
Termination Regulations” in Government Notice 1015 of 2010
(“the 2010
Regulations”). The said 2010 Regulations were
published on the basis of section 67(4) of the ECA, which empowered
ICASA to
prescribe regulations in this regard inter alia with a view
to imposing pro-competitive conditions upon licensees such as MTN and

Vodacom, which have significant market power.
[16]
The 2010 Regulations, which applied price controls initially for the
period from the 1
st
of March 2011 to the 1
st
of
March 2014, identified four market failures: lack of access; the
potential for discrimination between licensees offering similar

services, a lack of transparency and inefficient pricing. Inefficient
pricing was defined at the time to mean pricing, which is
“at
excessive levels above cost” or “significantly above
cost”. Thus, “cost-oriented prices”
was the
underlying basis of the 2010 Regulations.
[17]
In terms of regulation 7(5)(b) of the 2010 Regulations, MTN and
Vodacom were obliged to charge specified wholesale voice call

termination rates, on the basis of a “glide path”
comprising lower rates in each of three years governed by the said

regulations than rates, which were prescribed for smaller operators.
The applicable rates for MTN and Vodacom were stipulated in
Table 1
of the 2010 Regulations as follows:
Peak Calls
Off-Peak calls
1 March 2011
R0.73
R0.65
1 March 2012
R0.56
R0.52
1 March 2013
R0.40
R0.40
[18]
The glide path, which applied to MTN and Vodacom in terms of the 2010
Regulations, did not apply to Cell C and Telkom Mobile.
Thus, it was
specifically provided in terms of paragraph 1.3 of Appendix B of the
2010 Regulations that mobile operators other
than MTN and Vodacom
could charge higher mobile termination rates than those specified in
Table 1, in the event that such other
mobile operators satisfied
“either or both” of the requirements stipulated in
paragraph 1.3. Since the rates applicable
to these less dominant
mobile operators were higher than the stated rates in the glide path
applicable to MTN and Vodacom, the
applicable rates for these other
operators were described as “asymmetric”. The asymmetry
arose by virtue of the fact
that Cell C, for example, could charge
MTN a higher rate to terminate calls on the Cell C network than MTN
could charge Cell C
to terminate calls on the MTN network.
[19]
Paragraph 2 of the 2010 Regulations imposed a limit on the asymmetric
rate that Telkom Mobile and Cell C Mobile (as entities
which
qualified for an asymmetric rate), could charge. Thus, the entities
which qualified for the asymmetric rate could charge
the following
maximum rates above the rates stipulated in Table 1 :
- From  1 March 2011
: 20% (that is, R0,87,6).
- From  1 March
2012: 15%  (that is R0, 64,4)
- From  1 March 2013
: 10%  (that is, R0,44).
[20]
As a result of the issues germane to the present proceedings, the
2010 Regulations were specifically extended by ICASA to apply
until
the 1
st
of April 2014.
[21]
It appears from a draft to the 2010 Regulations that it was envisaged
that for future review periods, ICASA would use information
obtained
as a result of a cost modeling exercise, derived through the
imposition of the “Accounting Separation and Cost Accounting”

obligations imposed upon licensees “arising from this market to
inform the efficient charge”. It was for this reason
that
regulation 7(5)(c) of the 2010 Regulations required licensees
identified in regulation 7(4) “to submit regulatory financial

reports in line with the format prescribed in the Accounting
Separation and Cost Accounting Regulations prescribed” by
ICASA.
[22]
ICASA also indicated in an explanatory note to the 2010 Regulations
that it intended to conduct a review of the pro-competitive
price
control conditions it imposed in 2010 and indicated further that it
would promulgate cost and accounting regulations, which
would allow
it to gather cost information on an ongoing basis and so enable it to
review pro-competitive conditions it envisaged
in three years time,
in 2013. Thus, regulation 8 of the 2010 Regulations provided that a
review of the call termination market
was to take place after a
minimum period of three years from the publication of the 2010
Regulations.
[23]
Despite the provisions in the ECA and the provisions in the 2010
Regulations relating to accounting, ICASA never prescribed
the
accounting regulations envisaged by regulation 7(5)(c). Be that as it
may, the review of the voice call termination markets
(in respect of
each licensee’s prices) envisaged in regulation 8 of the 2010
Regulations was supposed to have taken place
on or after the 29
th
of October 2013, at the earliest.
[24]
In these circumstances, it appears that on the basis of the
provisions of section 37 of the ECA, read together with the 2010

Regulations, that even though ICASA is empowered in terms of section
67 to make regulations relating to the maximum wholesale termination

rate, which different operators can charge to other operators, the
actual termination rate charged from time to time by each licensed

operator of a mobile network to other networks, is actually governed
by interconnection agreements between such operator and each
of the
other licensed operators of other mobile networks, as envisaged in
subsection 37(1). As such, it may be mentioned that whilst
the
termination rate in such interconnection agreements can theoretically
be less than the prescribed maximum, it appeared from
these
proceedings that each operator charged the prescribed maximum rate to
each of the other operators.
[25]
On the 11
th
of October 2013, ICASA published “Draft
Call Termination Regulations” in terms of Government Notice
1018 of 2013 (“the
Draft Regulations”). The said Draft
Regulations incorporated a further glide path, for the period after
March 2014. The proposed
glide path in terms of the Draft Regulations
required MTN and Vodacom to charge the following wholesale call
termination rates
to a mobile location:
1 March 2014
R0.20
1 March 2015
R0.15
1 March 2016
R0.10
[26]
The Draft Regulations further provided that licensees other than MTN
and Vodacom such as Cell C and Telkom Mobile would be
entitled to
charge the following asymmetric termination rates in certain
circumstances:
1 March 2014
R0.39
1 March 2015
R0.33
1 March 2016
R0.26
1 March 2017
R0.20
1 March 2018
R0.14
1 March 2019
R0.10
[27]
The explanatory note to the Draft Regulations stipulated inter alia
that the cost of termination to a mobile location at the
time was
approximately 10c per minute based amongst other factors, upon the
increase in traffic in licensee networks. The said
explanatory note
to the Draft Regulations further stipulated that the stated level of
10c per minute should be reached in three
years, measured from the
1
st
of March 2014. Therefore, the explanatory note to the
Draft Regulations proposed that the termination rate of 40c, which
was applicable
to MTN and Vodacom from the 1
st
of March
2013 to the 1
st
of March 2014 (subsequently the 1
st
of April 2014), be reduced to 20c per minute in 2014, 15c per minute
in 2015 and 10c per minute in 2016. It was also indicated
in the
Draft Regulations at that stage that while the cost of terminating a
call to a mobile location was determined by ICASA to
be approximately
10c per minute, the cost to a fixed location was for some reason
determined to be higher at 12c to 19c per minute.
[28]
On the 4
th
of February 2014, ICASA published Call
Termination Regulations, 2014 in Government Notice 65 of 2014 (“the
2014 Regulations”).
In
an explanatory note to the 2014 Regulations ICASA states that its
analysis of market conditions revealed “little change
since
2010”.  ICASA accordingly further explained that it
maintained the view “new entrants and small players
require
additional pro-competitive support…. “. In addition, it
was also stated in the explanatory note to the 2014
Regulations that
the “.. continued market failure indicates that the level of
symmetry provided to smaller operators was
insufficient to generate
effective competition.” It is accordingly further stated in the
explanatory note at that stage that
the markets in this respect
“remain ineffectively competitive owing to inefficient
pricing”.
[29]
Even though the 2014 Regulations made reference to section 67(4) of
the ECA, it appeared that pursuant to the 2010 Regulations,
the
subsequent 2014 Regulations were published by ICASA in terms of
section 67(8) of the ECA, which provided for a “review”

of previous pro-competitive conditions imposed by ICASA on the basis
of an “earlier analysis”. Thus, ICASA acknowledged
in
these proceedings that the reference to section 67(4) in the 2014
Regulations was a “clear error”.
[30]
Regulation 7(4) (a) of the 2014 Regulations provided that for the
period from the 1
st
of March 2014 to the 1
st
of
March 2016, MTN and Vodacom are obliged to charge the following
wholesale voice call termination rates:
1 March 2014
R0.20
1 March 2015
R0.15
1 March 2016
R0.10
[31]
In effect, the prescribed rates in terms of the 2014 Regulations also
incorporated the notional glide path in relation to MTN
and Vodacom,
as with the 2010 Regulations. The prescribed termination rates
specified for MTN and Vodacom in the 2014 Regulations
were the same
as the rates, which were previously published in terms of the Draft
Regulations.
[32]
It was also stipulated in paragraph 1.1 of Appendix A of the 2014
Regulations that mobile operators other than MTN and Vodacom
could
charge higher asymmetrical termination fees than those specified in
the above glide-path, subject to the following maximum
amounts:
Current rate
R0.44
1 March 2014 -31 March
2015
R0.44
1 March 2015- 31 March
2016
R0.42
1 March 2016- 31 March
2017
R0.40
1 March 2017
R0.20
[33]
Clause 2.1 of Appendix A to the 2014 Regulations provided that
licensees qualified for a period of three years for the asymmetric

rate based on economies of scale and scope if it had less than 20% of
the share of total retail revenue generated in the relevant
market as
at December 2012.
[34]
In these circumstances, the mobile termination rates, which MTN and
Vodacom were permitted to charge in terms of the 2014 Regulations

after the 1
st
of April 2014 were reduced from 20c to 10c
over three years, whilst the higher termination rates, which Cell C
and Telkom Mobile
were entitled to charge were reduced from 44c to
40c in the same period.  Counsel for MTN summarized the position
in terms
of the 2014 Regulations for the next three years as follows:
Column 1
Column 2
Column 3
Column 4
Column 5
Date of commencement
Termination rates
charged by Cell C and Telkom Mobile
Termination rates
charged by MTN and Vodacom
Asymmetry value (i.e.
the difference between column 2 and 3)
Asymmetry % (i.e.
column 4 as a percentage of column 3)
1 March 2014
R0.44
R0.20
R0.24
120%
1 March 2015
R0.44
R0.15
R0.27
180%
1 March 2016
R0.40
R0.10
R0.30
300%
[35]
The 2014 Regulations were initially due to take effect from the 1
st
of March 2014. However, ICASA then extended the 2010 Regulations for
a further month, and further resolved (apparently on the 19
th
of February 2014) that parts of the 2014 Regulations would be
repealed. Thereafter, on or about the 12
th
of March 2014,
ICASA annexed a resolution to its answering affidavit in the present
proceedings indicating that it had resolved
to “repeal the 2014
Regulations insofar as they set mobile termination rates beyond 31
March 2014.” Subsequently, on
the morning of the 27
th
of March 2014, prior to closing arguments by MTN and Vodacom in the
present proceedings, ICASA’s counsel handed up to the
court a
copy of   “Second Call Termination Amendment
Regulations” published in Government Gazette Notice
240 of
2014, on the 26
th
March 2014, which reflected that the
2014 Regulations had been amended as indicated in ICASA’s
answering affidavit. The said
amended regulations, which commence on
the 1
st
of April 2014, are referred to in this judgment as
“the Amended 2014 Regulations”.
[36]
The effect of the Amended 2014 Regulations, together with the
extension of the 2010 Regulations, was that the wholesale voice
call
termination rate for MTN and Vodacom specified in the 2014
Regulations for the period 1
st
of April 2014 to 31 March
2015 (“the first year”) would now come into force for one
year only on the 1
st
of April 2014. Thus, the wholesale
voice call termination rate for MTN and Vodacom beyond the 31
st
of March 2015 in the 2014 Regulations for the period from the 1
st
of April 2015 to the 31
st
of March 2016 (“the second
year”) and the period from the1
st
of April 2016 to
the 31
st
of March 2017 (“the third year”) have
now been repealed in terms of the Amended 2014 Regulations.
[37]
In terms of the amended clause 2.1 of the Appendix A to the Amended
2014 Regulations, licensees accordingly qualified for a
period of one
year for the prescribed asymmetric rate “based on economies of
scale and scope” if it had less than 20%
of the share of total
retail revenue generated in the relevant market “as of December
2012”.
Promotion
of Administrative Justice Act 3 of 2000
[38]
The Promotion of Administrative Justice Act 3 of 2000 (“PAJA”)
is premised upon the Constitutional right to administrative
action,
which is lawful, reasonable and procedurally fair, as contemplated in
section 33 of the Constitution. It is accordingly
specifically
provided in section 3(1) of PAJA that administrative action, which
materially and adversely affects the rights or
legitimate
expectations of any person, must be procedurally fair.
[39]
Whilst section 3(2)(a) of PAJA provides that fair administrative
procedure depends upon the circumstances of each case, it
is also
provided in section 3(2)(b) that procedurally fair administrative
action incorporates inter alia adequate notice to the
affected party
of the nature and purpose of the proposed administrative action,
[15]
as well as a reasonable opportunity to make representations to the
administrator.
[16]
This
aspect of PAJA merely codifies the common law principle of
audi
alterem partem
as
a fundamental component of procedural fairness.
[17]
[40]
Administrative action is judicially reviewable in terms of PAJA inter
alia if the administrator, who took the said action:
(i)
was not authorised to do so by the empowering legislation;
[18]
(ii)
acted under a delegation of power, which was not authorized by the
empowering legislation;
[19]
(iii)
the action was procedurally unfair;
[20]
(iv)
the action was materially influenced by an error of law;
[21]
(iv)
the action was taken -
- for a reason not
authorised by the empowering legislation;
[22]
- on the basis of
irrelevant considerations or because relevant considerations were not
considered;
[23]
or
- arbitrarily or
capriciously;
[24]
(v)
the action itself -
- contravenes any
legislation or is not authorised by the empowering provision of such
legislation;
[25]
or
- is not rationally
connected to the purpose for which it was taken
[26]
;
or the purpose of the empowering provision
[27]
;
or the information before the administrator
[28]
;
or the reasons given for it by the administrator
[29]
.
[41]
As already indicated, a fundamental component of procedural fairness
in terms of PAJA (as well as the common law) constitutes
“a
reasonable opportunity to make representations” in relation to
administrative acts, which adversely affect the party
concerned.
[42]
As regards appropriate remedies in the context of PAJA, section 8(1)
of PAJA provides that in proceedings for judicial review,
the court
may grant an order which is “just and equitable”,
[30]
including an order setting aside the administrative action and
remitting the matter for reconsideration by the administrator, with

or without directions,
[31]
or
in exceptional cases, substituting or varying the administrative
action,
[32]
or granting a
temporary interdict or other temporary relief.
[33]
RULE
53 OF THE UNIFORM RULES OF COURT
[43]
To the extent that the final relief sought by MTN and Vodacom is now
sought as the primary relief premised upon judicial review,
it may be
mentioned by way of background that rule 53(1)(b) envisages that an
applicant in review proceedings is entitled to call
upon a
decision-maker to dispatch within 15 days of receiving a notice in
this respect, the record of proceedings relating to the

administrative decision, which the applicant seeks to set aside. In
practice, when an applicant seeks interim relief, pending final

judicial review, such record is obviously always requested from the
decision-maker concerned prior to the hearing of the review

application. The applicant, who is granted interim relief in these
circumstances, may then amend, add to or vary its notice of
motion
and supplement the founding affidavit in terms of rule 53 (4), prior
to setting down the application for judicial review
for hearing.
REQUIREMENTS
FOR INTERIM AND FINAL RELIEF
[44]
Leaving aside for the moment, the contentious aspect in the present
proceedings relating to whether or not MTN and Vodacom
can claim
final relief in the present proceedings, the requirements for both a
final interdict as well as an interim interdict
are well established
in our law.
[45]
For the purposes of establishing a final interdict in terms of which
a respondent is ordered either to refrain from committing
a certain
act or to refrain from performing a certain act, the applicant must
establish three essential requirements namely, a
clear right on the
part of an applicant,
[34]
an
injury actually committed or reasonably apprehended (evincing
interference with the applicant’s legal rights), and the

absence of any other satisfactory legal remedy available to the
applicant.
[35]
[46]
In contrast, the classic formulation of the requirements for an
interim interdict, which were set out in the case of
Setlogelo
v Setlogelo
,
[36]
one hundred years ago,
are also well established in our law. These requirements are:
(i)
Firstly, there must be a
prima
facie
right
on the part of the applicant;
[37]
(ii)
Secondly, there must be a well-grounded apprehension of irreparable
harm if the interim
relief is not granted and the ultimate relief
sought by the applicant is             eventually

granted;
[38]
(iii)
Thirdly, the balance of convenience must favour the granting of the
interim relief; and
(iv)
Fourthly, there must be no other ordinary remedy to give adequate
redress to the applicant.
[47]
In subsequent cases such as
Eriksen
Motors Ltd v Protea Motors
[39]
and
Radio
Islam v Chairperson,
[40]
the said requisites have
been applied on a ‘sliding scale’ in the sense propounded
in the case of
Olympic
Passenger Service (Pty) Ltd v Ramlagan,
[41]
in which it was held that the stronger the applicant’s
prima
facie
case,
the less need for balance of convenience in favour of the applicant
and the weaker the applicant’s
prima
facie
case,
the less the need for the balance of convenience to favour the
applicant.
RELEVANT
FACTUAL MATRIX AND PERTINENT AVERMENTS IN AFFIDAVITS
[48]
As already stated, the 2014 Regulations were published on the 4
th
of February 2014. MTN launched the present application some eight
days later on the 12
th
of February 2014. Vodacom
subsequently launched its application on the 25
th
of
February 2014. Thereafter, on or about the 12
th
of March
2014, ICASA annexed a copy of a resolution dated the 19
th
of February 2014 to its answering papers, reflecting its intention to
repeal parts of the 2014 Regulations. On the basis of such

resolution, MTN’s attorneys advised ICASA on the 17
th
of March 2014 that MTN intended to seek final relief at the hearing
of this matter between the 25
th
to the 27
th
of
March 2014. Thereafter, as already stated, both MTN and Vodacom
sought in the first instance final relief.
[49]
It is common cause on the papers that MTN and Vodacom have a much
longer history in the mobile telephone market than more recent

entrants, such as Cell C and Telkom Mobile. As already indicated,
ICASA initially imposed pro-competitive conditions in terms of
the
2010 Regulations, limiting mobile termination rates, which MTN and
Vodacom could charge, thereby permitting Cell C and Telkom
Mobile to
charge relatively higher termination rates. In these circumstances,
the maximum wholesale rates for terminating calls,
which MTN and
Vodacom have been permitted to charge in terms of the 2010
Regulations, are all lower than the asymmetrical rates,
which Cell C
and Telkom Mobile have been permitted to charge in terms of the 2010
Regulations.
[50]
By way of historical background, ICASA also made reference to
comparative research and statistics relating to the high mobile
fixed
retail prices in South Africa. Specifically, it appeared on the basis
of a study by the Organisation of Economic Development
that prior to
the 2010 Regulations, MTN consistently had the highest price in South
Africa for the cheapest prepaid products and
Vodacom was marginally
cheaper. It also appears from another comparative study that pursuant
to the enactment of the 2010 Regulations,
requiring MTN and Vodacom
to reduce their termination rates, consumers felt the benefits of
competitive pricing pressure from companies
such as Cell C. However,
prices for prepaid mobile services used by the majority of citizens
and particularly the poor, still remain
the highest in South Africa
compared to all other African countries forming part of the research,
including Sudan, Ghana, Kenya,
Mauritius and Nigeria. The said
comparative research and statistics were annexed to the answering
affidavit of ICASA and were not
disputed by MTN and Vodacom.
[51]
To the extent that it is relevant in this context, it is not in
dispute on the papers that prior to the institution of the

applications in this matter, MTN and Vodacom had engaged with ICASA
when the Draft Regulations were published. It is also not in
dispute
that the attorneys of record of MTN had communicated with ICASA on
the 10
th
of February 2014, setting out MTN’s reasons
for challenging the 2014 Regulations. MTN indicates in its founding
papers that
at that stage, Ms Batyi (the deponent to ICASA’s
answering affidavit) informed Parliament at the time that ICASA had
instructed
its lawyers “to write back to MTN and make it clear
that the provisions would not be removed”.
[52]
After the institution of legal proceedings by MTN and Vodacom, ICASA
initially made a “with prejudice” settlement
offer in
terms of which the 2014 Regulations, would only have operated for a
period of six months, whilst ICASA gave further consideration
to the
rates, which would apply thereafter. MTN and Vodacom rejected this
proposal.
[53]
Against this background, MTN states in its founding papers that
despite repeated requests, ICASA did not grant MTN access to

underlying information, on which ICASA had relied for the proposed
glide path and asymmetrical rates incorporated in the Draft

Regulations published in 2014.  MTN asserts that its request for
information in this respect as well as a meeting with ICASA
was not
granted. ICASA explains in this regard in its answering affidavit
that it took the view that “no further purpose
would be served”
by holding a further meeting in the light of “MTN’s clear
unwillingness to engage with ICASA
in relation to termination costs”.
[54]
It is recorded in ICASA’s answering affidavit in relation to
both the applications by MTN as well as Vodacom that after
consulting
with legal representatives and expert economists, ICASA was no longer
satisfied with “the robustness” of
its conclusions on the
appropriateness of the rates of 15c and 10c in the second and third
years, and was also not satisfied with
the “correctness of its
decision to impose those rates”. Be that as it may, it is
further stated in the answering affidavit
that ICASA did not have any
concerns with the call termination rate of 20c set to commence on the
1
st
of April 2014 for the first year in terms of the
Amended 2014 Regulations.
[55]
The deponent to ICASA’s answering affidavit states at a general
level, that ICASA was alive to the fact that the 2014
Regulations had
to be enacted without complete cost information having been supplied
to ICASA by MTN and Vodacom. It is also stated
in this context that
MTN and Vodacom had declined to supply such information to ICASA. Be
that as it may, it is stated in the answering
affidavit that ICASA
had resolved to repeal the 2014 Regulations insofar as they were
determined beyond the 31
st
of March 2015, and to
reconsider the correctness of the 15c and 10c rates, “preferably”
on the basis of complete cost
information to be requested by ICASA
from MTN and Vodacom. It is stated in this respect that whilst both
MTN and Vodacom dispute
the “base rate” of 10c, when it
was to be implemented in 2016, neither MTN nor Vodacom has disclosed
their actual costs.
[56]
It is also stated by way of background in the answering affidavit
that since the promulgation of the 2010 Regulations, consumers
have
been benefitting from competitive pricing pressures from smaller
operators such as Cell C. It appears to be common cause in
this
regard that the 2010 Regulations were premised upon the principle
that licensed mobile operators should be obliged to charge
wholesale
termination rates, which are progressively cost-oriented over time.
ICASA accordingly developed the notion
of the “glide
path”, initially in terms of the 2010 Regulations. ICASA also
determined rates in the glide path, which
applied to MTN and Vodacom
(as the two dominant operators) in terms of the 2010 Regulations.
Concomitantly with the rates applicable
to the two larger operators,
ICASA further determined relatively higher asymmetrical rates, which
could be charged by smaller mobile
operators such as Cell C during
the period of the glide path, which applied to the two dominant
operators.
[57]
It is not in dispute in the papers that the basis of the
cost-oriented determinations in the 2010 Regulations were
subsequently
reiterated by ICASA prior to the Draft Regulations being
published. ICASA indicates in its answering affidavit in this respect
that on the 7
th
of June 2013 it held a meeting for
stakeholders (including MTN and Vodacom) and presented to the said
stakeholders a paper entitled
“2014-2018 Cost to Communicate
Programme”. Reference was also made at the said meeting to a
questionnaire relating
to termination rates sent by ICASA to
operators.  The presentation paper, which is annexed to ICASA’s
answering affidavit,
included a copy of a slide, which presented as a
solution to high termination costs -
“
- Establish cost
base for call termination
- Introduce a regulated
glide-path towards the cost-base”.
Another slide reflects
that licensees could expect requests for information in the future as
well as “one-to-one engagement
between ICASA and the industry”.
[58]
Thereafter, in the explanatory note to the Draft Regulations in
October 2013, the cost of termination was determined to be

approximately 10c a minute and it was proposed that the said “level”
of 10c per minute should be reached in three years.
The explanatory
note to the Draft Regulations further proposed at the time that the
termination rate of 40c on the 1
st
of March 2013 be
reduced to 20c per minute in 2014, 15c per minute in 2015 and 10c per
minute in 2016.
[59]
After ICASA received representations from MTN as well as Vodacom
relating to the Draft Regulations, ICASA nevertheless proceeded
with
publishing the 2014 Regulations in February 2014. ICASA states in its
answering affidavit that the 2014 Regulations prescribed
termination
rates “over a period of time”, with the eventual goal
that mobile operators charge a fee for termination
that is oriented
towards the actual cost of providing that service. As such, it is
explained in its answering affidavit that the
reduction of the call
termination rate in a glide path “over time” was also
referred to in the context of the 2014
Regulations.
[60]
ICASA makes reference in the answering affidavits to a number of
different methodologies for the purposes of determining that
the
prescribed termination rate after 2014 would be above the actual cost
for efficient operators. It is also stated in the answering
affidavit
that the termination rate of 40c in the last year of the 2010
Regulations was, contrary to ICASA’s previous determination,

still “significantly above cost”. ICASA goes on to
conclude in its answering affidavit that as mobile operators were

setting termination rates at 40c per minute as permitted by the 2010
Regulations, there was no effective competition between mobile

operators. It was suggested that this was particularly so as prices
had not been driven down to cost. It is further stated in ICASA’s

answering affidavit that the finding in this respect is exactly the
same in both the 2010 Regulations as well as the 2014 Regulations.
[61]
In these circumstances, it is stated in the answering affidavit that
the obvious remedy was to impose a new rate, which reflected
the
actual cost of termination “more accurately” and that is
what ICASA “attempted” to do in the 2014 Regulations.
For
this purpose ICASA states that it determined the appropriate "base
rate” to be 10c.
[62]
ICASA makes much of the fact that whilst MTN and Vodacom dispute the
base rate of 10c, neither MTN or Vodacom has indicated
to ICASA its
actual costs. It appears not to be in dispute on the papers that MTN
and Vodacom have not submitted cost data to MTN
since 2008, when the
determination of 40c per minute was made in the context of the 2010
Regulations.  Be that as it may,
ICASA also indicates in its
answering affidavit that pursuant to consultations with independent
economic experts, ICASA was not
satisfied with the so-called “LRIC”
model, which apparently yielded the “robust” results of
15c and 10c
in the context of the 2014 Regulations, which have since
been repealed.
[63]
As already indicated, the accounting regulations envisaged in the
2010 Regulations were never promulgated by ICASA. Be that
as it may,
Vodacom indicates in this context that it repeatedly requested ICASA
to promulgate such regulations. In the absence
of accounting
regulations, and in the averred absence of disclosure and
consultation on methodologies used by ICASA, it appears
that for the
purposes of the 2014 Regulations, ICASA simply relied on “audited
financial statements and other information”
provided pursuant
to a “2013 questionnaire”. Reference is also made in this
context in ICASA’s answering affidavit
to the application of a
“LRIC-based financial model”.  Furthermore, ICASA
states that it “cross-checked
the results it obtained from this
exercise by benchmarking against termination rates in other
jurisdictions”. In response
to subsequent queries from Vodacom
pertaining to how ICASA determined that competition in the wholesale
market was ineffective,
ICASA stated that:
“
Using the
methodology in terms of section 67(6) of the ECA, the Authority
retained the conclusions put forward in the Call Termination

Regulations of 29 October 2010 that there is ineffective competition
in the market for the provision of voice call termination
services.”
[64]
In a similar vein, ICASA explained  :
“
In
the absence of any direct cost data received from MTN and Vodacom, it
was not possible for ICASA to attempt to determine an appropriate

termination rate using actual costs. Instead, it had to utilise a
similar method that it had followed for the 2010 Regulations…In

seeking to set a price based on the 2013 costs using available
financial results, ICASA thus followed a financial modeling exercise

using the cost structure for the provision of call termination
services extracted from the earlier COA/CAM filings and forecast

these expenses using information available to the operators’
Annual Financial Statements (AFS) and information in response
to the
2013 questionnaire. Apart from the more recent AFS and the
information supplied in response to the 2013 questionnaire, the
base
source of information was the same as had been used in 2010.”
[65]
ICASA further annexes to its answering affidavit a press release from
Vodacom dated the 26
th
of February 2014 in which it is
stated inter alia that:
“
Vodacom said on
Wednesday that it supported lower mobile rates ‘The issue at
hand is not whether these rates come down; it’s
about
ensuring  that the legislated fair and objective process is used
to determine the final rates’ …
The company stood by its
previous proposal to the Regulator that an interim cut be implemented
immediately.”
[66]
ICASA also annexes to its answering affidavit, a subsequent report by
James Hodge
et al
, consultants from Genesis (Pty) Ltd
(“Genesis”) dated 8
th
March 2014 relating to
mobile termination costs. The said consultants report that their best
“rough estimation of likely
termination costs” on the
basis of the most recent annual financial statements was to the
effect that MTN and Vodacom’s
2012 costs are below the
regulatory rate of 20c. It is further reported by these consultants
that a “bottom-up LRIC model”
is likely to establish
lower rates.
[67]
ICASA accordingly submits in its answering affidavit that there will
be a regulatory lacuna from the 1
st
of April 2014, if this
court declares the Amended 2014 Regulations to be invalid.  Thus,
ICASA submits that it will be appropriate
in the circumstances of
this case for the court to suspend any declaration of invalidity for
a period of six months in terms of
section 8(1) of PAJA read with
section 172(1)(b) of the Constitution, in the event that this court
was inclined to declare the
Amended 2014 Regulations invalid. MTN and
Vodacom do not respond directly to this suggestion in their replying
affidavits.
[68]
Both Cell C and Telkom Mobile aver for different reasons in their
respective answering affidavits on record that the regulatory

framework enacted by ICASA is not judicially reviewable. The deponent
to the answering affidavit of Cell C also states that for
the
purposes of its budget for 2014, Cell C will rely on the payments
from MTN and Vodacom for calls terminated on the Cell C network
at
the rates prescribed by ICASA for 2014. Thus, Cell C annexes to its
affidavit a copy of an extract of minutes of the board of
directors
of Cell C dated the 4
th
of December 2013, which reflects
that the investment of further equity into Cell C is subject to Cell
C’s mobile termination
rate being broadly similar to that
stipulated in the Draft Regulations in October 2013.  It is
further indicated in the said
extract that additional equity of US$
100 million to Cell C was approved during the course of the year
2014, subject to the mobile
termination rate for Cell C being
gazetted and introduced on a broadly similar basis to the Draft
Regulations. It is also noted
in the said extract that no further
equity investment would be made to Cell C prior to regulations, which
were broadly similar
to the Draft Regulations, being promulgated.  In
these circumstances, Cell C asserts in its answering affidavit that
it faces
dire financial consequences, if the regulatory scheme
proposed by ICASA does not come into force
[69]
In reply, both MTN and Vodacom reiterated that ICASA had not afforded
them an opportunity to make representations pertaining
to the
assumptions made by ICASA relating to costs. MTN also made a report
(with confidential aspects redacted) from independent
expert advisors
available to the court in this respect. Be that as it may, it appears
not to be in dispute on the papers that from
the time the 2010
Regulations were promulgated, all parties accepted that the
determination of termination rates by ICASA had to
be cost-based or
cost-oriented. Vodacom also does not deny that the press release
suggesting an interim cut in the termination
rate be implemented
“immediately” after the 26
th
of February 2014.
LEGAL
ISSUES
[70]
Against this background, as already stated, both MTN and Vodacom
indicate in their respective replying papers, that even though
they
initially sought interim relief against ICASA, they now seek in the
first instance, final relief in relation to the Amended
2014
Regulations, first disclosed by ICASA in answering papers.
Furthermore, both MTN and Vodacom now only seek interim relief
in the
alternative, pending the determination of judicial review of the
Amended 2014 Regulations.
Administrative
Action in terms of PAJA
[71]
Although there was some controversy in the past,
[42]
the Supreme Court of Appeal (“SCA”) has now confirmed
that the act of making regulations amounts to administrative
action
as contemplated in PAJA.
[43]
On this basis, counsel for MTN and Vodacom relied upon a number of
interlinked grounds of review, which fall within the ambit of
PAJA.
Final
or Interim Relief in terms of PAJA
[72]
The more contentious aspect in the present proceedings is whether MTN
and Vodacom are entitled to a final order reviewing and
setting aside
the Amended 2014 Regulations in the present urgent hearing, or
whether they are constrained to claim the interim
relief sought in
Parts A of their respective notices of motion.
[73]
It is trite that an applicant in motion proceedings is compelled to
stand or fall by its notice of motion and the averments
in its
founding affidavit.
[44]
It is
accordingly generally impermissible, as ICASA’s counsel
emphasized, for an applicant to make out a case in its replying

affidavit for the first time.
[45]
This general rule is however, not an absolute rule as the court has a
discretion to allow new matter in reply, after giving a respondent

the opportunity to deal with such new matter in a second set of
affidavits.
[46]
[74]
Generally in this regard, it is my view that a distinction must be
drawn between a case in which new material is first brought
out in
reply, even though an applicant knew of such material when the
founding affidavit was prepared, and a case where an applicant
(such
as the two applicants in the present case) relies on the existence or
possible existence of a further basis of relief in
reply to the
answering affidavit.
[47]
In
the latter type of case, the courts must be inclined more readily to
permit an applicant to utilize and extend the applicant’s

averments premised upon the revelations of the respondent in the
answering affidavit.
[48]
Indeed, in certain circumstances additional grounds of relief may
even arise from the belated revelations by the respondent.
[49]
Obviously, however, the court will generally not permit the
introduction of new matter if such new matter is premised upon the

abandonment of an existing claim and/or the substitution therefore of
a fresh and completely different claim, premised upon a completely

different cause of action
[50]
,
nor will the court permit an applicant to make out a case in reply
when no such case was made out in the initial application by
such
applicant.
[51]
[75]
In the present matter, ICASA’s unforeseen repeal of
determinations was a significant new revelation in answering papers,

which ICASA’s counsel characterized as “changed
circumstances”. Both MTN and Vodacom could not have anticipated

this fact when they were preparing their respective founding
affidavits. As MTN’s counsel correctly contended in this
respect,
the application by MTN was since inception been an
application to review and to set aside the 2014 Regulations
(subsequently the
Amended 2014 Regulations). It was accordingly
correctly averred that the said review was directed at all relevant
times to ICASA’s
decision to enact regulations for 2014.
Vodacom’s counsel went even further and asserted in closing
argument that for the
purposes of the amended relief sought by
Vodacom no reliance would be placed by Vodacom on the contents of its
replying affidavit.
[76]
Therefore, to the extent that both MTN and Vodacom simply utilized
and extended the initial averments made by them in reply,
premised
upon the disclosure of ICASA, the additional averments and the
amended final relief quite obviously arose directly from
ICASA’s
affidavit. It is accordingly my view that the submissions by counsel
for Cell C and Telkom Mobile in this regard
were misdirected. MTN and
Vodacom had not abandoned their existing claims for relief and they
had also not substituted their initial
claims for relief with a fresh
and completely different claim for relief, premised upon a completely
different cause of action.
[77]
The further procedural submissions by Cell C’s counsel
pertaining to its averred right to the record of proceedings were
in
my view also misdirected. ICASA does not dispute the averment by MTN
in the present proceedings that ICASA has in fact refused
to disclose
a record, as contemplated in rule 53(1)(b), and Vodacom’s
counsel confirmed during the course of proceedings
that Vodacom had
waived its rights to the said record.   In the context of
the procedure envisaged in rule 53, the record
of proceedings is
obviously filed for purposes of advancing the case of litigants, such
as MTN and Vodacom, who are challenging
the decision of a particular
decision-maker. Cell C, as an interested respondent which benefits
from the impugned decision, has
no procedural right to the said
record for possible future review applications, as suggested, nor
does Cell C advance any arguments
of prejudice in the context of the
present proceedings, if the record is not filed by ICASA.
[78]
In the final analysis, the final review claimed by MTN and Vodacom
can be adjudicated upon on the basis of undisputed facts
on the
papers relating to the legal issues in dispute.
[52]
It is also my view that to the extent that neither MTN nor
Vodacom (or for that matter ICASA) rely on the record of proceedings

to advance their respective cases in their capacity as the
decision-makers and the persons challenging the decision of the said

decision-maker, this court can adjudicate this matter without the
record. As already stated, Cell’s C’s right to the
said
record as an interested party, who is effectively a beneficiary of
the impugned decision, is misdirected.
[53]
[79]
Therefore, in order to obtain the primary final relief claimed,
premised upon a clear right, MTN and Vodacom must establish
such a
right in relation to the Amended 2014 Regulations on the basis of the
facts relied upon by MTN and Vodacom, which are not
disputed by ICASA
on the papers.
[54]
My view in
this regard is not affected by the fact that ICASA has not compiled a
“record of proceedings” relating to
the Amended 2014
Regulations as contemplated in rule 53(1)(b) of the rules of court.
[80]
Having found in the very exceptional and unprecedented circumstances
of the present proceedings that final relief can be claimed
on the
basis of the papers before me, I now turn to the submissions before
me relating to the averred clear rights of MTN and Vodacom.
Averments
with respect to MTN’s Clear Rights
[81]
On the basis of the provisions of PAJA, counsel for MTN summarized
the position of MTN on the basis of six broad grounds of
judicial
review in terms of section 6(2) of PAJA. These grounds of review were
as follows:
- Firstly, it was averred
that the differing maximum rates prescribed by ICASA are unlawful,
ultra vires
and void to the extent that ICASA may not by
regulation require or permit interconnection agreements, which are
prohibited in terms
of section 37(6) of the ECA. Thus, it was
contended that ICASA cannot, through subordinate legislation, permit
agreements, which
are prohibited by the empowering ECA.
- Secondly, it was
averred that to the extent that the higher asymmetrical rate charged
by Cell C and Telkom Mobile result in MTN
effectively subsidizing
these smaller operators, such a subsidy constitutes an impermissible
consequence in terms of the ECA;
- Thirdly, it was averred
that as the target rate of 10c per minute, as part of a composite
glide path, was flawed on the basis
of ICASA’s own version, the
remaining part of the said glide path (of 20c) was reviewable by
virtue of a number of grounds
stipulated in section 6(2) of PAJA.
- Fourthly, it was
averred that ICASA did not comply with the provisions of section
67(4)(e) relating to periodic reviews of the
relevant markets and
market segments as well as section 67(8) relating to the review of
market determinations on the basis of earlier
analysis, also in
contravention of section 6(2) of PAJA;
- Fifthly it was
contended that the determined asymmetric rates were premised upon an
ulterior purpose not empowered by the ECA.
- Sixthly, it was averred
that MTN’s right to procedural fairness was violated inter alia
by virtue of the fact that MTN was
not afforded an opportunity to
make representation relating to the benchmarking study referred to by
ICASA in its answering affidavit.
Averments
by Vodacom
[82]
Similarly, on the basis of the provisions of PAJA, counsel for
Vodacom summarized the position of Vodacom on the basis of four
broad
grounds of judicial review in terms of PAJA. These grounds of review
were as follows:
- Firstly, it was averred
that as ICASA acted beyond the powers conferred on it by section 67
of the ECA, its decision was reviewable
in terms of section
6(2)(a)(i) or 2 of PAJA.
- Secondly, it was
averred that as ICASA acted beyond the powers conferred on it by
section 67(8) of the ECA, its decision was reviewable
in terms of
section 6(2)(a)(i), 6(2)(e)(i) and 6(2)(f)(i) of PAJA.
- Thirdly, it was averred
that as ICASA acted irrationally and arbitrarily, its decision
reviewable in terms of section 6(2)(e)(iii)
of PAJA.
- Fourthly, it was
averred that as ICASA engaged in an unfair process, its decision was
reviewable in terms of section 6(2) (c)
of PAJA.
Is
there a clear right to any ground of review?
[83]
One of several areas that overlap between the averments of MTN and
Vodacom relate to the averred arbitrary decision of ICASA
regarding
the determination of the termination rate of 20c for the first year.
It was also averred in this respect that the said
determination was
reviewable by virtue of the fact that ICASA took into account
irrelevant considerations and failed to take into
account relevant
considerations.
[84]
It is not in dispute on the basis of ICASA’s averments in its
answering affidavit that the termination rates in terms
of the 2010
Regulations were cost-oriented, and were premised upon the notion of
a glide path over three years from 2011 to 2014
towards the “cost
base”. Thereafter, it is also not in dispute that ICASA
identified the solution for high termination
rates in June 2013 on
the basis that a “cost base” for such rates had to
established in the context of a further regulated
glide path towards
the said cost base.
[85]
The explanatory note to the Draft Regulations published by ICASA in
October 2013 stipulated inter alia that the cost of termination
at
the time was approximately 10c per minute to mobile locations, which
was at the time incomprehensibly lower than the stated
rate for
terminating calls to fixed locations in the sum of 12c to 19c. The
said explanatory further stipulated that the stated
level of 10c per
minute should be reached in three years. In these circumstances, the
explanatory note to the Draft Regulations
proposed that the
termination rate of 40c on 1 March 2013 be reduced to 20c per minute
in 2014, 15c per minute in 2015 and 10c
per minute in 2016.
[86]
Against this background, counsel for both MTN and Vodacom correctly
contended, certainly in the context of the repealed 2014
Regulations,
that the prescribed termination rate of 20c per minute in 2014 was
the first step in the glide path to the cost base
target rate of 10c
per minute in 2016. ICASA accordingly confirms in this regard in its
answering affidavit that the 2014 Regulations
were to be reduced
“over time” with the ultimate goal that mobile operators
charge a fee for termination which is oriented
towards the actual
cost of providing that service. ICASA further confirms in its
answering affidavit that the reduction of the
call termination rate
“over time” constituted the notional “glide path”.
[87]
ICASA states in its answering affidavit that it had “attempted”
to reflect the actual costs of termination in the
2014 Regulations by
determining “the appropriate ultimate rate of termination”
as the aforementioned base rate of 10c.
However, it admits it was not
“possible to determine an appropriate rate using actual costs”,
apparently because MTN
and Vodacom had not disclosed accounting
information. After the institution of the present applications by MTN
and Vodacom, ICASA
asserted that it was no longer satisfied with the
“robustness” of the rates of 15c and 10c and it was also
not satisfied
that it was correct in the first place to impose the
said two rates in the 2014 Regulations. As already stated, ICASA
admits in
this context that these rates were determined without any
cost information from MTN and Vodacom pertaining to their actual
costs
since 2008, and apparently also without ICASA developing a cost
model for information. ICASA accordingly repealed parts of the 2014

Regulations, which applied after the 31
st
of March 2015,
and undertook to reconsider the correctness of the 15c and 10c rates,
“preferably” on the basis of cost
information from MTN
and Vodacom.
[88]
I agree with counsel for MTN and Vodacom in these circumstances that
to the extent that the 15c rate as well as the 10c rate
was
incorrect, and were not premised on actual costs, the rate of 20c,
also incorporated in the glide path of the 2014 Regulations
could
also not have been premised upon any consideration of actual costs of
termination. In any event ICASA admits it was not possible
for it to
determine actual costs for 2014.
[89]
The only inference in these circumstances is that the determination
of the rate of 20c (retained in the Amended 2014 Regulations)
was an
arbitrary figure between the applicable rate of 40c per minute (in
terms of the last year of the 2010 Regulations) and 10c
per minute
(in terms of the repealed 2014 Regulations), which ICASA now admits
is incorrect.  In effect, if it is accepted
that the 10c figure
is incorrect, then the only basis for determining 20c is that it is
below 40c, without the benefit of a determined
rate for actual costs.
This is particularly so as ICASA fails to justify any basis for the
determination of the 20c rate in in
answering affidavit, despite the
reference to “various methodologies”, employed by ICASA
in this regard, nor does ICASA
disclose any internal documents
pertaining to its decision in this respect for the purposes of a
record of proceedings in the review
application. Matters are
exacerbated by the fact that ICASA tries to justify a change in
termination rates, but also suggests that
there was “little
change” since 2010.
[90]
It is also my view that ICASA cannot be heard to complain that MTN
and Vodacom have failed to disclose information on costs.
ICASA in
fact failed to promulgate the accounting regulations envisaged in
regulation 7 (c) of the 2010 Regulations, after apparently
being
urged to do so by both MTN and Vodacom at different stages.
[91]
In these circumstances, I agree with counsel for MTN and Vodacom that
to the extent that ICASA admits that the 2010 Regulations
were not
premised upon any accounting data or information on actual costs, the
2014 Regulations as well as the determination of
20c in the Amended
2014 Regulations could not have been “cost-based”.
Therefore, by its own admission, ICASA did not
take into account any
relevant cost and accounting considerations for the purposes of the
determination of all amounts in the 2014
Regulations as well as the
Amended 2014 Regulations. Moreover, even though ICASA admits that it
was not correct with respect to
two out of three determinations in a
glide path in the 2014 Regulations, it does not reasonably concede
that it was incorrect with
respect to the remaining determination of
20c in both the 2014 Regulations and the Amended 2014 Regulations,
when the said determination
of 20c was dependent on the “finding”
of 10c as actual cost.
[92]
Therefore, to the extent that ICASA admits that it had no information
pertaining to costs in the context of three cost-based

determinations, such determinations could not have been rationality
connected to information before ICASA. It concedes as much
for two
out of three determinations. Furthermore, it is my view that the
specific determination of the 20c per minute must have
taken into
account an irrelevant consideration in the form of the target cost of
10c (which ICASA admits was incorrect), and disregarded
relevant
considerations relating to the true cost of termination, as ICASA
admits that it did not have information before it in
this respect.
The only inference in these circumstances is that such determination
of 20c was completely arbitrary. This is obviously
so as there was no
rationally objective basis to make such a determination, based on the
information before ICASA.
[93]
It does not assist ICASA to assert that MTN and Vodacom have not
disclosed the actual cost of termination in 2014. It is not
in
dispute in this regard on the papers that regulation 7(5)(c) of the
2010 Regulations contemplated that ICASA puts in place accounting

regulations with a view to obtaining information, which would be
necessary to calculate the costs of termination at the end of
the
lifespan of the 2010 Regulations. However, such regulations were not
published. More importantly, in this context, ICASA accepted
as far
back as 2010 that the only objectively reasonable basis of
determining future termination rates was on the basis of actual

costs. If ICASA then admits it had no information on costs, the
determination of 20c cannot be defended, either objectively or

reasonably. This is particularly so as the only cost-based previous
determination, which was accepted by all, was 40c.
[94]
The subsequent report by Genesis does not assist ICASA in this
respect as the “rough estimates” in the said report
were
not considered by ICASA when it made the determination in relation to
2014 Regulations of 20c (in the first year), 15c (in
the second year)
and 10c (in the third) as part of a composite glide path. Even if 20c
is found to be above MTN’s current
cost of termination, as
ICASA seems to suggest on the basis of the Genesis report, ICASA
cannot be heard to defend its decision
ex
post facto.
Thus, it can only defend the termination rate of 20c for year one on
the basis of information or reasons before it at the time.
[55]
This is so by virtue of the fact that judicial review is concerned
with the process followed when a decision is made, not whether
an
administrator happened to reach the correct decision by chance.
[56]
[95]
Therefore, as stated by the English courts in this respect, a
decision-maker such as ICASA is generally barred from justifying
or
retrofitting any decision
ex post facto.
The Court of Appeal
in the case of
R V Westminister City Council, ex parte Ermakov
[1996] 2 All ER 302
(CA) at 315-316 held as follows in this
regard:
“
(2)  The
court can and, in appropriate cases, should admit evidence to
elucidate or, exceptionally, correct or add to the reasons;
but
should….be very cautious about doing so….Certainly
there seems to me to be no warrant for receiving and relying
on as
validating the decision evidence – as in this case- which
indicates that the real reasons were wholly different from
the stated
reasons….
(3) …. The cases
emphasise that the purpose of reasons is to inform the parties why
they have won or lost and enable them
to assess whether they have
ground for challenging an adverse decision. To permit wholesale
amendment or reversal of the stated
reasons is inimical to the
purpose. Moreover, not only does it encourage a sloppy approach by
the decision-maker, but gives rise
to practical difficulties. “
[96]
The above
dicta
in the
Ermakov
case were quoted with
approval in the case of
Jicama 17 (Pty) Ltd v West Coast District
Municipality
2006 (1) SA 116
at paras 11 and 12, where Cleaver J
held that a decision-maker “should not be allowed to supplement
the reasons for its decision
by reasons, which were clearly taken
ex
post facto”.
[97]
The above view is also supported in the case of
National Lotteries
Board v SA Education and Environment,
where Cachalia JA stated as
follows:
“
The duty to give
reasons for an administrative decision is a central element of the
constitutional duty to act fairly. And the failure
to give reasons,
which includes proper or adequate reasons, should ordinarily render
the disputed decision reviewable. In England,
the courts have said
that such a decision would ordinarily be void and cannot be validated
by different reasons given afterwards
– even if they show the
original decision may have been justified. For in truth the later
reasons are not true reasons for
the decision, but rather an
ex
post facto
rationalization
of a bad decision.”
[57]
[98]
For the reasons given on the basis of the papers before me, MTN and
Vodacom have established a clear right to review and to
set aside the
Amended 2014 Regulations (incorporating the 20c determination) for
more than one ground of review specified in section
6(2) of PAJA. The
Amended 2014 Regulations (or the denuded 2014 Regulations) are
accordingly unlawful and invalid.
[99]
It is not strictly necessary for me to consider the remaining grounds
of review, save to state that I am of the view that to
the extent
that the said remaining grounds of review are directed at any future
regulations, another court (not constrained by
the limits of urgency)
will be far better placed than this court to assess the sophisticated
and complex submissions and counter-submissions
by counsel from all
sides. I mention as an aside that some of the remaining submissions
by MTN and Vodacom appeared to me to have
less weight than others and
many of the remaining submissions by ICASA appeared very persuasive
to me. However, my views in this
regard are not relevant to this
judgment.
The
remaining requirements for final relief
[100]
Having established a clear right to judicial review, it follows that
the injury actually committed to MTN and Vodacom is obviously
that
their right to fair administrative action in terms of section 33 of
the Constitution has been violated. As demonstrated in
the papers,
the lower termination rates in the Amended 2014 Regulations will also
cause commercial prejudice to MTN and Vodacom.
Finally, in this
context, I am also satisfied that MTN and Vodacom cannot obtain
adequate redress in some form of “ordinary”
relief other
than judicial review, nor was any other existing remedy suggested as
appropriate. Thus, I am also satisfied that the
third requirement of
a final interdict has also been met. This is particularly so as the
infringement of any constitutional right
is generally a continuous
violation of the said right.
The
Separation of Powers Debate
[101]
ICASA, Cell C and Telkom challenged all the grounds of review relied
upon by MTN and Vodacom premised upon numerous cases
calling for
judicial deference in policy-laden matters, which fall within the
domain of the executive. Thus, reference was made
to the recent
decisions of
International
Trade Administration v SCAW South Africa
[58]
(“
SCAW
”)
and
National
Treasury v Opposition to Urban Tolling Alliance and others
(“
OUTA
”).
[59]
[102]
Both the unanimous decision of the Constitutional Court in the case
of
SCAW
as well as the majority decision of the Constitutional
Court in the case of
OUTA,
dealt with the relevant
considerations relating to attempts to interdict national government
from exercising its executive powers
in policy-laden matters. In the
SCAW
case, the Constitutional Court held that the High Court
had improperly breached the doctrine of separation of powers by
extending
the life-span of an anti-dumping duty. Thus, the court held
inter alia as follows:
- “A court should
be slow to override mandatory legislative provisions… “
[60]
- “Where the
Constitution or valid legislation has entrusted specific powers and
functions to a particular branch of government,
courts may not usurp
that power or function by making a decision of their preference. That
would frustrate the balance of power
implied in the principle of
separation of powers. The primary responsibility of a court is not to
make decisions reserved for or
within the domain of other branches of
government, but rather to ensure that the concerned branches of
government exercise their
authority within the bounds of the
Constitution. This would especially be so where the decision in issue
is policy-laden as well
as polycentric……
…
.
When a court is invited to intrude into the terrain of the executive,
especially when the executive decision-making process is
still
uncompleted, it must do so only in the clearest of cases and only
when irreparable harm is likely to ensue if interdictory
relief is
not granted. This is particularly true when the decision entails
multiple considerations of national policy choices and
specialist
knowledge, in regard to which courts are ill-suited to judge. In
Bato
Star
this court made the point that a court –
‘
should be careful
not to attribute to itself superior wisdom in relation to matters
entrusted to other branches of government. A
court should thus give
due weight to findings of fact and policy decisions made by those
with special expertise and experience
in the field.’”
[61]
- “ ….the
setting, changing and removal of an anti-dumping duty in order to
regulate exports and imports is a patently
executive function that
flows from the power to formulate and implement domestic and
international trade policy. The power resides
in the kraal of the
national executive authority,”
[62]
- “Courts may not
without justification trench upon the polycentric policy terrain of
international trade and its concomitant
foreign relations or
diplomatic considerations reserved by the Constitution for the
national executive.”
[63]
- “It was
inappropriate for the high court to grant an interim order which
invaded the terrain of the national executive function
without
appropriate justification “.
[64]
[103]
In a similar vein, it was held in the
OUTA
case that
“ …
.the duty
of determining how public resources are to be drawn upon and recorded
lies in the heartland of executive-government function
and domain.
What is more, absent any proof of unlawfulness or fraud or
corruption, the power and the prerogative to formulate and
implement
policy on how to finance public projects reside in the executive
domain of the national executive subject to budgetary
appropriations
by parliament…
…
the collection
and ordering of public resources inevitably call for policy-laden and
polycentric decision-making. Courts are not
well-suited to make
decisions of that order.”
[65]
[104]
By virtue of the reasons already given by me, it is my view in the
circumstances of this case, that the determination of 20c
in the
Amended 2014 Regulations is objectively irrational and unreasonable.
I mention as an aside that, unlike the
OUTA
and
SCAW
cases
(which dealt with cases involving the national purse and monies
received or allocated by government) the extension of termination

rates in 2014
per se
by ICASA is not really comparable at a
policy level. More importantly, the determination of termination
rates by ICASA is not in
issue in this matter. The primary issue
relating to the above ground of review upheld by me is whether the
determination of a cost-based
termination rate for 2014 is
objectively rational or reasonable. This court accordingly recognizes
that ICASA is entrusted with
certain powers and functions relating to
the determination of termination rates, and does propose usurping
that function.
Remedial
Powers of Court
[105]
Having found that the Amended 2014 Regulations are invalid and
unlawful in terms of PAJA, this court nevertheless has a discretion

not to set aside such regulations if it is “just and equitable”
to do so in terms of section 8(1) of PAJA. A similarly
wide power is
granted in terms of section 172(1)(b) of the Constitution, which
empowers this court to grant an order which is “just
and
equitable”, including  “an order suspending the
declaration of invalidity for any period and on any conditions,
to
allow the competent authority to correct the defect”.
[106]
Therefore, even though I have found that the determination of the
rate of 20c in the Amended 2014 Regulations (as well as
that part of
the 2014 Regulations, which has not been repealed) was irrational and
arbitrary, it is significant that the previous
cost-based
determination of 40c in the 2010 Regulations is common cause. It is
also significant that MTN and Vodacom do not in
effect oppose ICASA’s
justification in answering papers for a further reduction from 40c,
based upon the ICASA’s authority
to regulate pro-competitive
conditions on the basis of cost-based wholesale termination rates.
There is also nothing before me
in the papers to suggest that the
actual cost of termination is higher than the arbitrarily determined
rate of 20c.
[107]
As regards the court’s discretion, the full bench of the SCA in
the
Oudekraal
case held as follows:
“…
a court
that is asked to set aside an invalid administrative act in
proceedings for judicial review has a discretion whether to
grant or
withhold the remedy. It is that discretion that accords to judicial
review its essential and pivotal role in administrative
law, for it
constitutes the indispensible moderating tool for avoiding or
minimising injustice when legality and certainty collide.
Each remedy
thus has its separate application to its appropriate circumstances
and they ought not to be seen as interchangeable
manifestations of a
single remedy that arises when an administrative act is invalid.”
[66]
[108]
The Constitutional Court has explained the discretion of the courts
in this context in the case of
Bengwenyama
on the following
basis:
“
The apparent
anomaly that an unlawful act can produce legally effective
consequences is not one that admits easy and consistently
logical
solutions. But then the law often is a pragmatic blend of logic with
experience. The apparent rigour of declaring conduct
in conflict with
the Constitution and PAJA unlawful is ameliorated in both the
Constitution and PAJA by providing for a just and
equitable remedy in
its wake. I do not think it s wise to lay down inflexible rules in
determining a just and equitable remedy
following upon a declaration
of unlawful administrative action. The rule of law must never be
relinquished, but the circumstances
of each case must be examined in
order to determine whether factual certainty requires some
amelioration of legality, and if so,
to what extent.”
[67]
[109]
On the basis of these authorities, this court is empowered to leave
the Amended 2014 Regulations in place, with full legal
effect, for a
limited period with a view to permitting ICASA to amend the said
regulations. As Cameron J recently held in this
regard in the case of
Estate
Agency Board
[68]
“
Suspension
is not an ordinary remedy. It is an obvious use of this Court’s
remedial powers under the Constitution to ensure
that just and
equitable constitutional relief is afforded to litigants, while
ensuring that there is no disruption of the regulatory
aspects of the
statutory provision that is invalidated. This was explained in J:
‘
The suspension of
an order is appropriate in cases where the striking down of the
statute would, in the absence of a suspension
order, leave a lacuna.
In such cases, the Court must consider, on the one hand, the
interests of the successful litigant in obtaining
immediate
constitutional relief and, on the other hand, the potential
disruption of the administration of justice that would be
caused by
the lacuna’ “
[110]
In considering justice and equity in the arena of administrative
rights, our courts have often weighed the interests of successful

litigants, who seek to set aside invalid administrative action,
against competing interests such as for example, pragmatic
considerations
in relation to the retention of the
status
quo ante
,
or overwhelming considerations of social justice. So, for example, in
the recent case of
Allpay,
the SCA
and the Constitutional Court weighed the competing interests of
constitutional rights relating to an irregular tender and
the
compelling necessity to continue paying millions of individuals, who
receive social grants.
[69]
[111]
Other cases in this sphere include the case instituted by Mr
Fraser
[70]
,
relating to unconstitutional common law provisions, which permitted
children born out of wedlock to be adopted without their natural

father’s consent. Even though Mr Fraser successfully challenged
the statutory provisions in this regard, he was not granted
any
substantive relief, as the Constitutional Court suspended the
declaration of invalidity of the relevant statutory provisions
for a
period of two years. Thus, Mohamed DP accepted that this case was a
proper case for the Constitutional Court to exercise
its jurisdiction
in circumstances where Mr Fraser was not the only person affected by
the impugned statutory provisions. The court
accordingly found in the
circumstances of that case that it was in the interests of justice
and good government that proper legislation
to regulate the rights of
fathers of children born out of a relationship, which was not
formalized by marriage, should be promulgated
during the period of
suspension of the declaration of invalidity of the common law.
[112]
To similar effect in the
Mvumvu
case,
[71]
the Constitutional Court
suspended a declaration of invalidity in respect of a provision of
the Road Accident Act 56 of 1996, which
discriminated against largely
poor, black claimants. The said decision was premised upon Parliament
being “best-suited”
to determine the extent of
compensation, which the applicants in that case could claim from the
Road Accident Fund.
[113]
ICASA averred in the circumstances of the present case that if this
court declared the Amended 2014 Regulations invalid and
did not
contemporaneously suspend any declaratory order of invalidity, then
the wholesale termination rate market would be unregulated
from the
1
st
of April 2014, and this would create an unwarranted regulatory
lacuna
[72]
or vacuum
[73]
.
Counsel for MTN averred that the present case was distinguishable
from cases such as
Fraser,
as the Amended 2014 Regulations were still not in force and there was
accordingly no entrenched
status
quo ante
.
Thus, they averred that the effect of a court order setting aside the
invalid regulations in the present case would merely take
the form of
preventing a
new
regulatory regime from coming into force on the 1
st
of April.
[114]
My difficulty with the line of argument adopted by counsel for MTN is
that the Amended 2014 Regulations are in my view not
as much a new
regime as a natural continuation of a previous regulatory regime,
which was accepted by all parties concerned from
the 1
st
of March 2011 to the 31
st
of March 2014. Indeed,
notwithstanding articulate submissions to this court on aspects such
as the effect of section 37(6) in the
context of the Amended 2014
Regulations, it is significant that both MTN and Vodacom have been
living with and have accepted the
2010 Regulations for three years,
after reaping the benefits of an unregulated pre-2011 market
conditions (with no effective competition)
for many years. Thus, as
indicated in ICASA’s answering affidavit, MTN and Vodacom have
handsomely profited from an unregulated
market before 2011 and they
did not dispute the underlying basis of cost-oriented determinations
in 2010. Furthermore, in a press
release as late as the 26
th
of February 2014, Vodacom even accepted that an “immediate”
reduction of termination costs was warranted after the
2010
Regulations would no longer be in force.
[115]
It is also significant that MTN and Vodacom could not and did not
dispute  the research, statistics and studies referred
to by
ICASA in its answering affidavit relating to prices prior to 2010.
Moreover, the necessity for continued cost-oriented termination

rates, where there were market failures in the form of inefficient
pricing and high costs for prepaid phones as explained in the

answering affidavit, were effectively common cause on the papers.
Furthermore, on the basis of the factual averments in the answering

affidavit, it was effectively explained by ICASA that the
implementation of the 2010 Regulations promoted competition, lowered

costs and facilitated access to affordable telephony for the majority
of the population in all spheres of their lives including
of course,
economic activity, education, access to essential services such as
health emergencies, social grants and the like. The
importance of
such affordable access to telephony to indigent members of our
population, particularly in remote rural areas, can
hardly be
disputed.
[116]
A further consideration favouring suspension on the basis of my
discretion is the fact that MTN and Vodacom are both very
profitable
companies, motivated in these proceedings primarily, if not
exclusively, by commercial considerations. Thus, the nature
and
extent of competing considerations are not as pressing as they were
in the
Allpay
case or
for that matter the
Fraser
or
Mvumbu
cases
or cases such as
Fourie,
[74]
where the court dealt with invalid common law legislation preventing
same sex couples from getting married. In contrast, in the
present
case, the only prejudice, which flows from an infringement to the
right to fair administrative action, appears to be a
loss of revenue
for MTN and Vodacom. This potential loss of revenue has to be weighed
against the likelihood of a price war triggered
by Cell C and Telkom
Mobile, which will benefit the public if the Amended 2014 Regulations
come into force, even for a limited
period.
[117]
It is also my view that there are pragmatic considerations, which
warrant suspension of my declaration of invalidity. I appreciate
in
this regard that ICASA is burdened with the difficult task of
promoting competition in the market relating to termination rates
on
the basis of a “multifarous and nuanced”
[75]
regulatory
regime. This is particularly so as the economic debate as well as the
complex methodologies debated before this court
demonstrated that
there are different regulatory pathways open to ICASA and they
require a reasonable period to assess the market
and to make
appropriate determinations.
[118]
Furthermore, ICASA as well as Telkom’s counsel correctly
emphasized in this context that the application of the 20c
figure
during the proposed suspended period is also not likely to be
prejudicial to MTN and Vodacom, given the fact that there
is
effectively no evidence to challenge the contention by ICASA that the
said figure in fact exceeded actual costs. This is so
despite the
fact that I have found that the determination of that figure by ICASA
was irrational and arbitrary. It appears to me
in this regard that
both MTN and Vodacom have effectively shielded behind the armour of
fair administrative rights with as much
vigour as shielding behind
the armour of non-disclosure (in the absence of accounting
regulations). Therefore, even though ICASA
has not promulgated
regulations relating to accounting (as envisaged by the ECA as well
as the 2010 Regulations), it seems only
logical that the best way of
demonstrating the non-efficacy of the 20c figure, is to disclose the
cost-base relating to that figure.
Be that as it may, on the basis of
ICASA’s answering affidavit, I accept for the purposes of
exercising my discretion that
20c exceeded the actual cost of
terminating calls as at the 1
st
of April 2014.
[119]
It may also be mentioned in this regard that Cell C’s counsel,
relied on the
dicta
by the Constitutional Court in the
Allpay
case,
[76]
and submitted that
if this court was inclined to exercise its judicial discretion in
this case, then it would be appropriate to
file further affidavits on
factual issues. It was contended that this was so despite the fact
that this court already has a record
exceeding 2000 pages. It is
significant that counsel for the decision maker, ICASA made
submissions on all the relevant factual
considerations, particularly
the effects of an unregulated regime, on the basis of factual
averments incorporated in ICASA’s
answering affidavit. In my
view, no further factual averments by Cell C are necessary in this
regard other than those already on
record in the context of the
present proceedings. This is also so by virtue of the fact that Cell
C was cited in these proceedings
only as an interested and affected
party, and was accordingly not challenging the decision of ICASA in
the present proceedings.
In any event, Cell C’s team of three
counsel was not precluded from making submissions in this regard to
this court.
[120]
For all the reasons given, I am of the view that this is a proper
case, which warrants this court exercising its discretion
to promote
the purposes of the ECA, premised upon the public interest.  As
already indicated, all the information necessary
for this court to
exercise its discretion was incorporated in the affidavits,
particularly the undisputed aspects of the answering
affidavit of
ICASA. As suggested by ICASA, I am of the view that it is just and
equitable in the circumstances to suspend the invalidity
of the
Amended 2014 Regulations for a period of 6 months from the 1
st
of April 2014.
CONCLUSION
[121]
For all the reasons given, MTN and Vodacom succeed with their
applications for final judicial review. However, in the interests
of
justice and equity, it is appropriate for this court to suspend the
impugned regulations for a period of six months.
[122]
In the interests of completeness, I also propose incorporating my
interlocutory order pertaining to the consolidation of the
two
applications in this matter in my final order. In addition, I propose
making an order pertaining   to the urgent
hearing of the
consolidated applications.
COSTS
[123]
Even though MTN and Vodacom have been successful with one ground of
final review, it is not appropriate in the circumstances
of this case
for this court to make an adverse costs award against ICASA, as a
statutory body vested with the responsibility of
carrying out certain
functions in the public interest. I accordingly propose making an
order that each party pays its own costs,
also on the basis that it
is just and equitable to do so.
ORDER
[124]
Based on the aforegoing, the following order is made:
(i) The urgent
applications under case numbers 04699/2014 and 6701/2014 are hereby
consolidated;
(ii) The forms and
services provided for in the rules of court are hereby dispensed with
and it is directed that the consolidated
applications be heard as
urgent applications in terms of rule 6(12) of the Uniform Rules of
Court;
(iii) The “SECOND
CALL TERMINATION AMENDMENT REGULATIONS, 2014” published in
Government Gazette number 37471 on the
26
th
of March 2014
as notice 240 of 2014, are declared to be invalid and unlawful;
(iv) The declaration of
invalidity in terms paragraph (iii) above, is suspended for a period
of 6 (six) months from the 1
st
of April 2014; and
(v) Each party is to bear
its own costs.
DATED
AT JOHANNESBURG THIS 31st DAY OF MARCH 2014
___________________________
MAYAT
J
JUDGE
OF THE HIGH COURT
OF
SOUTH AFRICA
Counsel
for MTN        :              Wim

Trengove SC
Alfred
Cockrell SC
Adrian
Friedman
Attorneys
for MTN      :             Webber

Wentzel
Counsel
for Vodacom :            Fanie
Cilliers SC
Frank
Snyckers SC
M
le Roux
Attorneys
for Vodacom:          Cliffe
Dekker Hofmeyr
Counsel
for ICASA    :            Gilbert
Marcus SC
David
Unterhalter SC
Mark
Wesley
Steven
Budlender
Richard
Moultre
Attorneys
for ICASA    :           Bowman
Gilfillan
Counsel
for Cell C :                 Arnold

Subel SC
Kate
Hofmeyr
Nick
Ferreira
Attorneys
for Cell C:                Norton
Rose
Fullbright South Africa
Counsel
for Telkom :               Vincent
Maleka SC
Jonny
Blou SC
Muzi
Sikhakhane
Alan
Lamplough
Attorneys
For Telkom:            Edward
Nathan Sonnenbergs
Date
of Hearing
:         25
th
to
the 27
th
of March 2014
Date
of Judgment       :
31
st
of March 2014
[1]
Section 4(1) (a)
[2]
Section 2
[3]
Section 2(m)
[4]
Section 2(n)
[5]
Section 67(1)
[6]
Section 67(2)(a)
[7]
Section 67(4)(a)
[8]
Section 67(4)(b)
[9]
Section 67(7)(a)
[10]
Section 67(7)(f)
[11]
Section 67(7)(g)
[12]
Section 67(7)(h)
[13]
Section 67(8)(a)(i)
[14]
Section 67(8)(a)(ii)
[15]
Section 3(2)(b)(i)
[16]
Section 3(2)(b)(ii). See also cases such as
Yuen
v Minister of Home Affairs and Another
1998
(1) SA 958
(C) at 965 B-C where the court held that the right to a
hearing implies the right to be informed of facts which may be
detrimental
to the affected person.
[17]
See, for example, the case of
Turner
v Jockey Club of South Africa
1974
(3) 633 (A) at 651C and 656A, which reflected the pre-Constitutional
common law.
[18]
Section 6(2)(a)(i)
[19]
Section 6(2)(a)(ii)
[20]
Section 6(2)
[21]
Section 6(2)(d)
[22]
Section 6(2)(e)(i)
[23]
Section 6(2)(e)(iii)
[24]
Section 6(2)(e)(vi)
[25]
Section 6(2)(f)(i)
[26]
Section 6(2)(f)(ii)(aa)
[27]
Section 6(2)(f)(ii)(bb)
[28]
Section 6(2)(f)(ii)(cc)
[29]
Section 6(2)(f)(ii)(aa)
[30]
A similarly wide remedial power exists in terms of section 172(1)(b)
of the Constitution, which grants the court a power to grant
any
order that is “just and equitable” including “an
order suspending the declaration of invalidity for any
period and on
any conditions, to allow the competent authority to correct the
defect.”
[31]
Section 8(1)(c)(i)
[32]
Section 8(1)(c)(ii)
[33]
Section 8(1)(e)
[34]
Whilst, Erasmus’ commentary on
Superior
Court Practice
at E8-6D and the authorities cited therein suggest that the phrase
“clear right” has been so loosely used to the
point that
its meaning is not always clear, it is also indicated on the basis
of the authorities cited that a “clear right”
is
generally accepted in legal terminology simply as a right which is
“clearly established” or a “definite
right”.
See, for example, the case of
Welkom
Bottling Co (Pty) Ltd v Belfast Mineral Waters (OFS) (Pty) Ltd
1967
(3) SA 45
(O) at 56F.
[35]
See, for example, in this regard the cases of
Chapman’s
Peak Hotel (Pty) Ltd Jab and Annalene Restaurants CC t/a O’Hagans
[2001]
4 All SA 415
(C) and
V
& A Waterfront Properties (Pty) Ltd v Helicopter & Marine
Services (Pty) Ltd
2006
(1) SA 252
(SCA) at 257F-258B.
[36]
1914 AD 221
at 227
[37]
Clayden J in
Webster
v Mitchell
1948
(1) SA 1186
(W) at 1189 accepted that a prima facie right may be
established though it is open to ‘some doubt’.
[38]
If the applicant can establish a clear right his apprehension of
irreparable harm need not be established. The test for irreparable

harm is an objective one as set out in cases such as
Minister
of Law and Order v Nordien
1987
(2) SA 894
(A) at 896G-I and
National
Council of Societies for the Prevention of Cruelty to Animals v
Openshaw
[2008] ZASCA 78
;
2008
(5) SA 339
(SCA) at 347B-E.
[39]
1973 (3) SA 85
(A) at 691 F
[40]
IBA
1999
(3) SA 897
(W) at 903G
[41]
1957 (2) SA 382
(D) at 383D-F
[42]
See
Minister
of
Health
and Another NO v New Clicks South Africa (Pty) Ltd and Others
(Treatment Action Campaign and Another as Amici Curiae)
2006
(2) SA 311
(CC
)
in
which five Judges (Chaskalson CJ, Langa DCJ, Ngcobo, O’Regan
and van der Westhuizen JJ) held that regulations do constitute

administrative action, one Judge (Sachs J) held that they do not and
five Judges held that it was not necessary to decide the
question
(Moseneke, Madlala, Mokgoro and Yacoob JJ)
[43]
City of
Tshwane Metropolitan Municipality v Cable City (Pty) Ltd
2010
(3) SA 589
(SCA) at para 10
[44]
Betlane
v Shelley Court CC
2011
(1) SA 388
(CC), citing
Van
der Merwe and Another v Taylor NO and Others
2008
(1) SA 1
(CC) para 122;
President
of the Republic of South Africa and Others v South African Rugby
Football Union and Others
2000
(1) SA 1
(CC) para 150;
National
Council of Societies for the Prevention of Cruelty to Animals v
Openshaw
fn
38,
supra
paras 29-30 and
Pountas
Trustee v Lahanas
1924
WLD 67
at 68
[45]
Van der
Merwe, supra,
fn
44 para 122;
SARFU
,
supra
fn 44
para 150; and
Director
of Hospital Services v Mistry
1979
(1) SA 626
(A) at 636 A-B
[46]
See for example, the cases of
Shephard
v Tuckers Land and Development Corporation (Pty) Ltd (1)
1978
(1) SA 173
(W) at 178A;
Baek
& Co SA (Pty) Ltd v Van Zummeren
1982
(2) SA 112
(W) at 116A-E;
Skjelbreds
Rederi A/S v Hartless (Pty) Ltd
1982
(2) SA 739
(W) at 742D and
Finishing
Touch 163 (Pty) Ltd v BHP Billiton Energy Coal South Africa Ltd
2013
(2) SA 204
(SCA) at 212B-C
[47]
This is the also the view expressed by Erasmus in his commentary on
rule 6(5) (e) relating to the necessary allegations in a
replying
affidavit, at B1-46 in line with the
dicta
of Miller J in the case of
Shakot
Investments (Pty) Ltd v Town Council for the Borough of Stanger
1976
(2) SA 701
(D) at 705A-B.
[48]
Erasmus,
supra
and the authorities cited therein including
Driefontein
Consolidated GM Ltd v Schlochauer
1902
TS 33
at 38 and
Registrar
of Insurance v Johannesburg Insurance Co Ltd (I)
1962
(4) SA 546 (W).
[49]
Erasmus,
supra
and the authorities cited in this context.
[50]
Erasmus,
supra,
and
the authorities cited in this context including
Triomf
Kunsmis (Edms) Bpk v AE & CI Bpk
1984
(2) SA 261
(W) at 270A and
Johannesburg
City Council v Bruma Thirty-Two (Pty) Ltd
1962
(4) 546 (W) where there were no facts in dispute and the issues
related purely to a matter of law;
Kleynhans
v Van der Westhuizen NO
1970
(1) SA 565
(O) at 568F, where the court exercised its discretion
relating to facts in a replying affidavit by virtue of “special
circumstances”;
Cohen
NO v Nel
1975
(3) SA 963
(W) at 966F where the court referred to the exercise of
the court’s discretion in relation to an applicant’s
replying
affidavit;
Shakot
Investments
,
supra,
fn 47;
Cowburn
v Nasopie (Edms) Bpk
1980
(2) SA 547
(NC) at 565B-D ;
Shepherd
v Mitchell Cotts Seafreight (SA) (Pty) Ltd
1984
(3) SA 202
(T) at 205F where the full bench held that the general
rule that an applicant has to make out its case in the founding
affidavit
is not an absolute rule;
Pienaar
v Thusano Foundation
1992
(2) SA 552
(B) at 578C-D, where the court dealing with the
winding-up of a company held that in could not be held in the
circumstances of
that case that it could not be expected of the
applicant to have all facts and information relating to “relevant”
information subsequently put before the court; and more recently
Finishing
Touch 163, supra,
fn
46 33, 212C-D, where the SCA quoted the
Shokot
Investment case, supra,
fn
47 with approval.
[51]
Poseidon
Ships Agencies (Pty) Ltd v African Coaling and Exporting Co (Durban)
(Pty) Ltd
1980
(1) SA 313
(D) at 316 A
[52]
See
Bader
v Weston
1967
(1) SA 134
(C) at 138D;
Dickinson
v South African General Electric Co (Pty) Ltd
1973
(2) SA 620
(A) at 628F;
Cohen
NO, supra,
fn
50, at 970;
Dawood
v Mahomed
1979(2)
SA 361 (D) at 365H;
Nampesca
(SA) Products (Pty) Ltd v Zaderer
1999
(1) SA 886
(C) at 892J
-
893A;
Dhladhla
v Erasmus
1999
(1) SA 1065
(LCC) at 1072D and
South
Peninsula Municipality v Evans
2001
(1) SA 271
(C) at 283A-H
[53]
This case is accordingly distinguishable from the case of
Democratic
Alliance and Others v Acting National Director of Public
Prosecutions and Others
2012
(3) SA 486
(SCA) para 37 where the review was premised upon aspects
of the record.
[54]
On the basis of the well-known principles set out by Corbett
JA in the case of
Plascon
Evans Paints Ltd v Van Riebeck Paints (Pty) Ltd
1984
(3) 623 (AD) at 634E-635D.
[55]
Democratic
Alliance
case,
supra,
paras
36-40
[56]
Democratic
Alliance
case,
supra,
paras 36-40
[57]
2012 (4) SA 504
(SCA) at para 27
[58]
2012 (4) SA 618 (CC)
[59]
2012 (6) SA 223 (CC)
[60]
at para 87
[61]
at paras 95-101
[62]
at para 103
[63]
at para 105
[64]
at para 111
[65]
at paras 67and 68
[66]
Oudekraal
Estates (Pty) Ltd v City of Cape Town and Others
2004
(6) SA 222
(SCA) at para 36
[67]
Bengwenyama
Minerals (Pty) Ltd and Others v Genorah Resources (Pty) Ltd and
Others
2011
(4) SA 113 (CC)
[68]
Estate
Agency Board v Auction Alliance (Pty) Ltd and Others
(CCT
94/13)
[2014 ZACC 3
(27 February 2014) at paras 55-57
[69]
Allpay
Consolidates Investment Holdings (Pty) Ltd v Chief Executive
Officer, South African Social Security Agency and Others
2014
(1) SA 604 (CC)
[70]
Fraser
v Children’s Court, Pretoria North and Others
1997
(2) SA 261
(CC) at para 50
[71]
Mvumvu
and Others v Minister of Transport and Another
2011
(2) SA 473 (CC)
[72]
See also
J
and Another v Director General, Department of Home Affairs and
Others
[2003] ZACC 3
;
2003 (5) SA 621
(CC) at para 21
[73]
See also
Doctors
For Life Intl v Speaker of the National Assembly
[2006] ZACC 11
;
2006
(6) SA 416
(CC) at para 214 and
Sex
Workers Education and Advocacy Task Force and Others as Amici Curiae
[2002] ZACC 22
;
2002
(6) SA 642
(CC) at paras 123-126
[74]
Minister
of Home Affairs v Fourie (Doctors for Life International and Others,
Amici Curiae)
2006
(1) SA 524 (CC)
[75]
As stated by Mahomed DP in the case of
Fraser
at
para 50
[76]
at paragraph 96