Preparing for the Future: Telecom Regulatory Challenges in Tanzania

Recently, Incyte concluded a substantial study for the Tanzania Communications Regulatory Authority (TCRA) reviewing the legal and regulatory framework for the telecommunications and internet subsector in Tanzania for gaps that need to be filled if new and emerging technologies and issues are to be effectively addressed both now and in foreseeable future.

It is not the purpose of this note to reflect upon the specific conclusions and recommendations associated with the Tanzanian review. The TCRA will publish the outcomes in due course. However, some broader observations may be usefully made, taking account of this study and Incyte’s other recent consulting work, particularly in countries with developing economies that aspire to leverage the potential of digital transformation to improve their economic performance and social cohesion.

The legal and regulatory framework for the sector has become far more complex over the past 2-3 decades since the initial period of liberalisation. This reflects the convergence of all sectors in the economy based on the adoption of digital technologies, the definition of new products and services, and their delivery via digital means. Typically, frameworks deal with a number of primary statutes covering matters such as:

• the establishment and powers of the sector regulator;
• the establishment and powers of an economy-wide competition regulator;
• general criminal codes applicable to the sector;
• cybersecurity and cybercrime;
• universal service and, possible, separate arrangements for funds administration;
• digitalization and digital literacy; and
• management of scarce resources such as radiofrequency spectrum.

In addition, all of the above statutes, however organized, will generate many separate sets of regulations, rules and guidelines. The number and complexity of regulatory instruments is increasing rapidly.

Maintaining consistency: As new issues arise, typically one or some of these legal instruments will be amended, but, again typically, not all. The instruments are subject to control and administration by different ministries and agencies, and not all have the same priorities for review or are amended at the same time or with the same frequency. The result is that often inconsistencies arise within any given framework, generating avoidable confusion and uncertainty. To address inconsistency is a first order matter, quite apart from reviewing the framework in terms of its adequacy and fitness for purpose in new and emerging circumstances.

Optimum specificity: Stakeholders need to be engaged and encouraged to participate in the framework review. In our work in this area in various countries Incyte has noticed that a significant minority of stakeholders usually consider that the failure of primary legislation and of regulations to directly and explicitly address specific services or topics should automatically lead to the conclusion that there is a gap in the framework and that it is likely to be unfit for purpose. On this view of the matter, if AI is not explicitly mentioned in regulatory instruments, it is not covered.

This conclusion is not necessarily correct, and not automatically so. Our experience suggests that primary legislation and key regulations need to be pitched at an appropriate level of abstraction to cover new and emerging technologies and services, even those that cannot be specifically named or envisaged at an earlier stage of development. In that way legislation and regulations have a level of enduring robustness and are not easily rendered inadequate by the inevitable developments in technologies and markets. If there are specific aspects of new and emerging technologies and services that require additional clarification, this may be provided by the development of supplementary rules and guidelines. Rules and guidelines have the added advantage of being readily amended compared to regulations, and, especially, compared to primary legislation.

Rapid change: Many new digital technologies and applications are in a state of substantial flux. Their capabilities are being rapidly expanded, demand may be growing rapidly, and issues and consequences might be emerging equally rapidly. It is important for all sector regulators to determine not only whether they might usefully intervene, but also at what stage to do so. This has been the case with Artificial Intelligence (AI) and Machine Learning (ML). Regulatory intervention too early might well choke off innovation and development. Intervention too late might be ineffective after the harms that were initially envisaged have actually occurred. Working out the best approach and optimizing regulatory benefit are matters that regulators need to address, and have the specific power to address. The authority to forebear is as important as the power to act, under these circumstances. The legal and regulatory framework needs to recognize this, and do so explicitly.

Stakeholder engagement: It is also important in framework reviews of this kind to understand where implementation is causing problems for sector stakeholders. This could be in terms of investment, uncertainty of application, unchecked market power, inadvertent consequences of regulatory processes and policies, uneconomic market entry, burdensome regulatory processes, and so on. Stakeholder consultation and engagement are critical for identifying and dimensioning problems of these kinds. Some licensees have the view that the regulator has an obligation to support them in their businesses, and to protect against commercial failure. This is not so, of course: the success and sustainability of businesses in the telecommunications and digital sectors, and across the economy, is ultimately the responsibility of their owners and management. Regulators owe all stakeholders obligations relating to professional, transparent, non-discriminatory administration in terms of well-articulated rules and procedures. Part of that involves consultation and engagement on key issues and proposed regulation.

Whole of Government and Whole of Society Complexity: The telecommunications and digital sector is critical to the transformation and development of the entirety of modern economies and for ensuring multiple levels of cohesion and interconnectedness in modern societies. The telecommunications and digital sector is integral to all of these things and cannot be considered as just one economic sector amongst many. In these circumstances complexity increases and many issues need to be addressed by the whole of government and the whole of society as a result. Complex issues do not admit of simple solutions. For many issues the simple solution is to give responsibility to a single organisation or agency. This works well enough for well-worked and established areas of regulatory administration, but it is not appropriate for emerging multi-faceted issues, such as issues associated with AI, platform markets, digital literacy, cybersecurity, universal digital services, and cloud-based services. The creation of new and specialized agencies may appear to solve some problems, but inevitably creates many more through increased interfaces and increased coordination complexity. This is a real and continuing challenge for most regulators and public sector bodies generally. Our experience suggests that most regulators and agencies in the sector prefer to operate within their own mandates, tend to “protect their patch”, and are not particularly good and effective at inter-agency coordination.

Reluctance to commit to SMART targets: Many jurisdictions have developed national digital policies, with articulation of long-term visions of the desired economic, social and cultural benefits that are being sought through investment in digital infrastructure and encouraging the development of digital services. These policies are part of the framework that needs regular review. Long term national ambitions are very important and setting them out serves a number of very important purposes – including ensuring that all participants can share a common focus (however broad) and can understand national priorities. We see 2026 and the rest of the decade as the time, globally, when national long-term ambitions need to be translated into more immediate actionable plans. National policy statements are not self-delivering. Without that next step, national digital policies remain rhetorical and become merely performative – that is, they are there for show and not for results.

We see the need in may jurisdictions to overcome the reluctance to move to the next step and to develop SMART targets for implementation and for allocating roles and accountabilities. SMART is an acronym in which each letter reflects a characteristic of the targets that are needed to accompany broader policy statements, namely that such targets should be Specific, Measurable, Achievable, Relevant and Time-bound.

Summary:

• Jurisdictions need to review their legal and regulatory frameworks to ensure they remain fit for purpose on a regular basis – not set and forget;
• Optimizing levels of generality and abstraction is critical for robustness and endurance of legislation and regulatory instruments;
• Frameworks are becoming more complex both in scope and in terms of multi-faceted impacts across the whole economy and of society;
• Knowing when to intervene is as important as knowing whether to intervene for regulators, and the power to forebear should always be made explicit in framework component legislation;
• Creating new agencies may be needed, but is not an adequate response to the need to manage addressing new technologies, markets and applications;
• More than ever, multi-institution and multi-agency coordination is needed for successful digital transformation; and
• We are moving from statements of policy and ambition in the case of digital policies, and this calls for SMART objectives, achievement of which can be the basis of objective assessment and meaningful accountabilities.