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Price Cap Regulations for Postal Services Amended

September 28, 2021

Independent Communications Authority

Price Cap Regulations for Reserved Postal Services have been amended.

The Independent Communications Authority published the amended Regulations in Government Gazette 45217.

A new definition on “Price Control Period” is inserted.

It “means the period commencing from 1 April XXXX and ending on 31 March XXXX or such period as may be determined by the Authority”.

A new Regulation 3 on General Price Control Formula is also inserted.

According to the reasons document, the amended Regulations are designed to set the prices of reserved postal services in such a way that such prices are affordable; cost-oriented (i.e. reflective of the costs of providing the postal service concerned); uniform throughout South Africa (unless ICASA determines otherwise) and transparent and non-discriminatory.

ICASA sought comment on the amended Regulations in March 2021.

At the time, ICASA pointed out that the proposed Regulations will consider the Post Office’s cost structure such that it allows for “recovery of prudently and efficiently incurred costs” and allow the Post Office to earn profit “commensurate with risk as opposed to the current Price Cap formula which inadvertently causes SAPO to experience a shrinking profit margin annually”.

The amended Regulations will come into effect on 1 April 2022.