South Africa Reconsiders BEE Rules as Starlink Waits at the Gate

Could Elon Musk’s satellite internet finally land in Africa’s richest economy? A policy review in Pretoria may decide.

In most of Africa, Elon Musk’s Starlink has already set up camp. From Namibia to Mozambique to Botswana, households and businesses are wiring up to satellites and bypassing shaky national networks. But here in South Africa—the continent’s largest economy and Musk’s birthplace, Starlink remains conspicuously absent.

Why? One word: ownership.

The Policy Roadblock

South Africa’s Black Economic Empowerment (BEE) laws require foreign companies in key industries to hand over 30% ownership to Black investors. The rule was designed to tackle the deep inequalities left by apartheid, especially in industries that shape the future, like telecommunications.

But Starlink, like other tech firms, has balked. Elon Musk has publicly called the requirement “openly racist” and SpaceX has refused to surrender equity. Instead, the company has lobbied for a workaround: allowing “equity-equivalent programmes” where firms can invest in community projects, digital inclusion, or research instead of ceding ownership.

The Department of Communications and Digital Technologies has received a staggering 19,000 submissions on whether to amend the rules. Minister Solly Malatsi says the government is prioritising the review and will soon submit recommendations to Icasa, the regulator.

The Stakes for South Africans

For everyday South Africans, the question isn’t about Musk’s fortune, it’s about access to reliable, affordable internet.

South Africa’s data costs are among the highest in the world, and many rural communities remain offline altogether. Satellite internet could be a game-changer, offering connectivity without waiting for fibre cables to snake into remote valleys or informal settlements.

“Starlink could bridge the digital divide in a way government hasn’t managed,” wrote one Twitter user, reflecting the buzz on social media. Others point out that without competition, local providers have little incentive to drop prices or expand faster.

Critics Push Back

Not everyone is sold on the idea of bending rules for Musk. Opposition parties and civil society groups accuse government of rewriting BEE to favour a foreign billionaire while local entrepreneurs still face hurdles.

“Why should wealthy outsiders get a pass on transformation when local firms don’t?” asked one civic activist in Johannesburg. “It’s a slap in the face for Black South Africans trying to build businesses.”

They also worry about precedent: if Starlink gets an exemption, what stops every multinational from demanding the same?

Not the First Exemption

It’s worth noting that similar compromises already exist. In 2019, global carmakers like BMW, Toyota, and Ford pooled resources to fund transformation programmes instead of handing over equity. Supporters of the Starlink policy shift argue that digital inclusion projects could have even greater impact, especially in schools and under-connected townships.

A Balancing Act

At its heart, the debate is about more than Starlink. It’s about how South Africa balances economic transformation with global competitiveness.

On one hand, BEE rules remain essential for addressing structural inequalities that are still painfully visible. On the other, inflexible regulations risk keeping the country cut off from world-leading technologies, while neighbours surge ahead.

For now, Starlink continues to beam internet into more than 17 African countries, while South Africa, Musk’s homeland, watches from the sidelines.

 The government’s decision will ripple far beyond one company. If South Africa loosens the rules, millions could gain access to affordable internet. If it doesn’t, the country risks falling further behind in the global digital race.

{Source: Business Insider Africa}

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