Uganda ICT Minister: Seeks Time on Wi-Fi Hotspot Licensing Dispute

• The Ugandan government has requested two weeks to resolve a dispute over Wi-Fi hotspot licensing.
• The Kampala City Traders Association (KACITA) petitioned for a special micro-network service provider licence for operators.
• Hotspot operators claim they provide affordable internet to underserved communities but face closure due to high licensing costs.
• MTN Uganda stated that commercial resale of internet packages by hotspot operators breaches service terms and UCC regulations.
• Concerns also include the Uganda Revenue Authority (URA) impounding networking equipment, which the ICT Minister will clarify.

The resolution of this matter will set a precedent for how innovation and small-scale entrepreneurship are integrated into the broader telecommunications sector.

The Ugandan government has requested a two-week period to address a contentious issue surrounding the licensing of local Wi-Fi hotspot operators. This move comes amidst growing concerns that the current regulatory framework could inadvertently lead to the closure of small businesses and restrict access to affordable internet services across the country. The Minister of Information, Communication, and Technology (ICT), Kasule Lumumba, conveyed this need for additional time to Parliament's Committee on Information and Communications Technology, emphasizing the necessity for extensive consultations with various stakeholders.

Minister Lumumba indicated that the ministry requires this extended timeframe to engage thoroughly with telecommunications companies, internet service providers, regulatory bodies, and the petitioners themselves. The objective is to formulate and present a comprehensive resolution to the committee. This dispute was brought to the forefront by a formal petition from the Kampala City Traders Association (KACITA), which is advocating for parliamentary support to establish a distinct micro-network service provider licence. This proposed licence would specifically cater to hotspot operators who acquire bulk internet packages and subsequently re-distribute connectivity to paying customers.

These operators contend that their activities have been instrumental in expanding internet access to communities that are otherwise underserved, simultaneously fostering new livelihood opportunities. However, they argue that the existing licensing requirements and associated costs are prohibitively high, making compliance exceedingly difficult for their small-scale operations and threatening their continued existence. The parliamentary committee, under the chairmanship of Andrew Ojok Oulanyah, acknowledged the complexities of the situation and agreed to facilitate further engagement, with the Minister pledging to collaborate with all parties to devise a regulatory framework that both supports small businesses and safeguards the interests of established, licensed service providers.

The core of the disagreement lies in the current licensing regime, which many small operators find to be a significant barrier to entry and sustainable operation. Mackinon Kabarole, the Chief Marketing Officer at MTN Uganda, clarified to the committee that while hotspot operators are not necessarily engaging in illegal tapping of telecommunications networks, they are re-purposing internet packages. These packages, originally intended for individual or designated business use, are being commercially resold, which constitutes a breach of the terms under which the services were initially supplied.

Kabarole further highlighted that the redistribution of internet services without the requisite licence directly contravenes regulations set forth by the Uganda Communications Commission (UCC). However, Minister Lumumba raised a pertinent question regarding the uniformity of contractual arrangements, noting that some hotspot operators might have formal agreements with telecommunications providers, while others might not. KACITA's chairman, Hajji Issa Sekitto, explained that the association intervened after receiving numerous complaints from its members who operate these hotspots, underscoring their role in bridging internet access gaps for various segments of society, including households, students, and businesses reliant on online resources.

Disan Kayima, KACITA's Head of ICT and a board member, specifically appealed to Parliament for the establishment of a permanent commercial micro-network service provider licence, potentially alongside an agency arrangement. Kayima stressed that the existing licensing categories and their associated costs are ill-suited for the scale and operational models of small operators, necessitating a tailored approach. Beyond licensing, the petition also brought to light concerns regarding the importation of networking equipment, such as routers and switches. KACITA reported instances where consignments of such equipment had been impounded by the Uganda Revenue Authority (URA). Kayima expressed the uncertainty among traders concerning the classification of this equipment, which is reportedly being treated as contraband ICT equipment, despite similar devices often being used for legitimate purposes like home internet installations. Minister Lumumba committed to engaging with the URA, her technical team, and the Ministry of Finance to provide much-needed clarity on the requirements governing equipment imports and their approval process.

This ongoing dispute holds significant implications for Uganda's digital landscape and its economic development. The potential for existing regulations to force small Wi-Fi hotspot businesses out of operation could severely impact the availability of affordable internet, particularly in areas where traditional internet service providers have limited reach. These micro-operators play a crucial role in extending connectivity to underserved communities, thereby supporting educational pursuits, facilitating online research, and enabling marketing efforts for local businesses and individuals.

The resolution of this matter will set a precedent for how innovation and small-scale entrepreneurship are integrated into the broader telecommunications sector. Establishing a clear and equitable regulatory framework that allows these businesses to operate legally, without undermining the investments and services of larger, licensed providers, is paramount. As Committee Chair Oulanyah articulated, the goal is to create rules that enable different players to coexist harmoniously, fostering a competitive yet fair market environment.

Furthermore, the uncertainty surrounding the importation of essential ICT equipment poses a direct threat to business continuity and investment in digital infrastructure. Clarifying the classification and approval processes for devices like routers and switches is essential to prevent unnecessary delays and costs for traders. The government's commitment to address both the licensing regime and import regulations demonstrates an understanding of the interconnected challenges facing Uganda's internet ecosystem, with the ultimate aim of ensuring that business is not unduly hindered.

Lawyers advising telecommunications or internet service providers in Uganda should closely monitor the ongoing government consultations regarding Wi-Fi hotspot licensing. Anticipate potential changes to UCC regulations, the introduction of new micro-network service provider license categories, and clarified import rules for ICT equipment, which will necessitate a review of compliance strategies for both existing operators and new market entrants.

Source: Original reporting via local news.