South Africa - International Franchise Association

long-awaited spectrum auction, ensuring the digital migration remains on track,
stabilizing the Department of Communication’s state-owned-entities (including Telkom
(national telephone operator), South African Broadcasting Company, Sentech (signals
provider), and improving broadband penetration. South Africa’s biggest priority going
forward will be meeting the ambitious target of 2013 for the migration from analog to
digital broadcasting, which, if achieved, will significantly improve South Africa’s
broadcasting capabilities. The move to digital terrestrial broadcasting will open an
opportunity for new players. Provide While Regulatory uncertainty and fragmented
competition have stifled growth, the sector remains stifled. However, South Africa aims
to encourage more competition in the sector. The United States-led SEACOM undersea
fiber-optic cable project became operational in late July 2009 and expanded broad-band
connectivity in South Africa and other countries on Africa’s eastern seaboard.
Political Violence Return to top
Political violence is not currently a serious problem in South Africa. In 2011, South
Africa’s Independent Electoral Commission, with support from the South African Police
Service, held municipal elections generally considered free and fair, despite minor voting
irregularities, and violence was not a factor. Service delivery protests and strike actions
can turn violent.
Corruption Return to top
South Africa has an excellent anti-corruption regulatory framework, highlighted by the
passage of the Prevention and Combating of Corrupt Activities Act of 2004. In 2010 and
2011 the government intensified anti-corruption efforts. While the newly formed priority
crimes unit, known as the “Hawks”, thus far is still deemed less effective than the unit it
replaced in 2009 (the “Scorpions”), it has arrested a number of white collar criminals for
banking irregularities and fraud.
Despite the advances against corruption, allegations of corruption in the public tendering
process persist, including at the provincial and municipal levels.
Corruption, including bribery, raises the costs and risks of doing business. Corruption
has a corrosive impact on both market opportunities overseas for U.S. companies and
the broader business climate. It also deters international investment, stifles economic
growth and development, distorts prices, and undermines the rule of law.
It is important for U.S. companies, irrespective of their size, to assess the business
climate in the relevant market in which they will be operating or investing, and to have an
effective compliance program or measures to prevent and detect corruption, including
foreign bribery. U.S. individuals and firms operating or investing in foreign markets
should take the time to become familiar with the relevant anticorruption laws of both the
foreign country and the United States in order to properly comply with them, and where
appropriate, they should seek the advice of legal counsel.
The U.S. Government seeks to level the global playing field for U.S. businesses by
encouraging other countries to take steps to criminalize their own companies’ acts of
corruption, including bribery of foreign public officials, by requiring them to uphold their
obligations under relevant international conventions. A U. S. firm that believes a