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MultiChoice backtracks on exit threats

A week after a conclusive 157-page judgement from the High Court ended MultiChoice’s 11-year fight to avoid tariff regulation in Botswana, the pay-TV giant appears to be cooling off on threats to quit Botswana.

Ahead of the highly anticipated case, MultiChoice Africa had submitted papers with a not-so discrete ultimatum.

“MultiChoice Africa’s position is that it cannot submit to BOCRA’s regulatory jurisdiction and risk other African regulators following suit.

“If it is forced to submit to regulation in Botswana, it may have to re-evaluate its relationship with MultiChoice Botswana or the provision of DStv service to subscribers in Botswana in order to preserve its commercial viability.”

The Botswana Communications Regulatory Authority (BOCRA), emboldened by the enactment of new legislation, pushed the brinkmanship a step further. If it could not regulate MultiChoice’s tariffs, then the regulator’s existence was redundant, BOCRA said. BOCRA said it would pull MultiChoice’s licence; MultiChoice said it would quit Botswana.

High Court judge, Tshepo Motswagole had the final say a week ago, when he ruled that MultiChoice, and its DStv service, should apply to BOCRA for approval every time they wish to increase their tariffs.

“Anyone who wants to have stake in the broadcasting process that is intended to be received in Botswana and sets up a network that will make the broadcasting material accessible by the members of the public in Botswana, acting either alone or in cooperation with others, will be caught up by the regulatory regime established for Botswana,” said Motswagole.

From the combative stance, MultiChoice appears to be walking back its initial position, releasing a curt and measured statement yesterday.

“MultiChoice Botswana has noted the ruling of the High Court of Botswana and will study the judgement accordingly.

“In the meantime, we would like to assure our Batswana DStv customers of our continued commitment to delivering value by making great video entertainment accessible on DStv in Botswana.”

The pay-TV giant has six weeks to appeal Motswagole’s judgement and legal experts close to the matter expect MultiChoice to take its time weighing its next move.

The experts believe MultiChoice could decide to drop the matter and limit the antagonism with the regulator, particularly as the comprehensiveness of Motswagole’s judgement portends weak prospects of a successful appeal.

“Motswagole was very thorough, citing the 2007 Court of Appeal proceedings, international law particularly precedents from Europe and thoroughly dealing with the complex, legal and linguistic arguments from both sides,” one analyst said.

“MultiChoice will consider the possible fall-out from appealing this, then losing at the Court of Appeal. Such a possibility, especially on such a prominent scale, could cascade across the group’s other African entities, prompting regulators in those countries to approach their own courts.

“Leaving it at the High Court also helps MultiChoice somewhat re-establish cordial relations with a regulator who next April will decide on how much they can increase their tariffs by.”

BOCRA’s strength in the matter, going by Motswagole’s judgement, is drawn largely from the Communications Regulatory Authority Act of

2012. The Act plugged several loopholes, which led to BOCRA’s predecessor, the National Broadcasting Board, losing to MultiChoice in 2007.

The analyst said the 2012 legislation and Motswagole’s interpretation of it, were significant weights against an appeal.

Where in 2007, MultiChoice was able to “escape” regulation of tariffs by saying its signal originated outside Botswana, Motswagole noted that the 2012 Act and supporting policies had a different focus.

“The above statements (MultiChoice’s arguments on territory) fail to appreciate that the new legislative framework has moved away from attempting to regulate the process of broadcasting by controlling the physical location of transmitters to emphasise on the effect of broadcast material on the area targetted irrespective of the form of technology deployed or the origin of the signal.”

Motswagole continued: “In other words, the focus of regulation is not on the origin of the signal but on the broadcast target area.

The place of origin is not even mentioned in the new legislation and by introducing a new phrase “broadcasting organisation” a number of entities cutting across national boundaries are captured as long as their joint efforts have effect in Botswana and not merely confined to outer space beyond the jurisdiction of this country by impacting members of the public in this Republic as intended by the broadcasting organisation.”

On MultiChoice Botswana’s argument that it only operated a subscription management service in Botswana and not a broadcasting service, which would mean it was not subject to tariff regulation as a broadcaster, Motswagole again leaned on the new Act.

MultiChoice’s lawyers had argued that MultiChoice Africa broadcasts, meaning it puts a signal into the clouds, but that is entirely outside the borders of Botswana. The subscription management service, operated by MultiChoice Botswana, enables consumption of the signal via decoders, collecting payment. Thus, according to their argument, enabling that consumption was not broadcasting. MultiChoice Botswana was thus not broadcasting and therefore immune from tariff review, while the entity broadcasting was outside Botswana’s borders.

Motswagole was unmoved by the argument. “In my view, the applicant’s (MultiChoice Botswana) argument is merely attractive but offers no help as it fails to deal with the very clear terms of the new legislation,” the judge said.

“The Act says subscription management service and this involves a number of activities, some of which contribute directly and are key to the process of broadcasting and therefore amount collectively to engagement in a broadcasting activity, requiring a licence.

“More importantly, however, the very terms of Section 31 of the Communications Regulatory Authority Act regard subscription management service as a broadcasting activity.”

With four more weeks to go to file an appeal, all eyes are on whether MultiChoice will choose to fight on, or take the hit and move on.




Another EVM for dustbin!

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