FEATURE

Media and Telecommunications: Singapore Law and Regulatory Framework
 

The authors present an overview of the latest developments in media and telecommunications laws in Singapore.

The twin forces of convergence of technology and globalisation continue to impact the telecommunications and broadcasting and media industries. Intensified global competition continues apace in the wake of greater national deregulation and liberalisation. In Singapore, the deregulation and liberalisation is a response not only to changing technology and consumer demand but also to entrenching Singapore’s role as a communication hub. 

Singapore’s deregulation of the telecommunications sector was marked in April 2000 by the accelerated cessation of the duopoly held by Singapore Telecommunications Ltd (‘Singtel’) and StarHub Pte Ltd (‘StarHub’), and compensation of S$1.2bn, received by Singtel and StarHub for the loss of the duopoly. Liberalisation of the media industry in 2000 has resulted in more consumer choice in two free-to-air broadcasters operating seven channels, cable TV and Digital TV. Singapore Press Holdings (‘SPH’), the newspaper printing company, set up a free commuter tabloid, STREATS, and ventured into broadcasting by setting up two free-to-air television channels, while  MediaCorp, the broadcasting company, ventured into the publishing industry by launching TODAY, a free commuter tabloid. In 2001, with the introduction of TV Mobile, Singapore became the first testbed in the world for commercial digital TV programmes delivered on public transport. In April 2004, Singapore’s Ministry of Trade and Industry released a competition bill for public consultation. Singapore’s Competition Act is expected to be enacted sometime in early 2005. 

On 17 September 2004, both SPH and MediaCorp announced a merger of their television operations and free newspaper business as part of a rationalisation process to stem haemorrhaging losses chalked up by both companies of over S$50m a year since 2000. SPH will give up its television arm to MediaCorp and take a 20% stake for S$10m in a new joint venture company, MediaCorp TV Holdings. In the free newspaper scene, SPH’s STREATS will be merged with its rival, TODAY, and SPH will take a 40% stake in MediaCorp Press, MediaCorp’s publishing arm which publishes TODAY. As a result of the merger, MediaCorp has, in effect, re-emerged as the sole local broadcaster in Singapore. 

In view of the SPH-MediaCorp merger and the potential implications on competition, especially in the broadcasting industry, the authors feel this article is a timely review of the regulatory structure of the media and telecommunications industries, keeping in view the potential impact of two emerging influences, namely, the new draft competition law in Singapore, as well as the impact of technological convergence on the Singapore regulatory framework. 

An Overview of Media Law in Singapore

Media regulation in Singapore and the role of the Media Development Authority (‘MDA’)

The government’s goal of Singapore as a vibrant Global Media City, as encapsulated in its vision statement titled Media 21, aspires to establish Singapore as a hub wherein media services and projects are created, developed, traded and distributed to the international market. Consonant with Media 21’s vision, MDA was set up to promote and champion the development of a vibrant media cluster in Singapore. As articulated in MDA’s vision statement titled ‘Media 21: Transforming Singapore into a Global Media City’,1 MDA’s overarching strategy is to transform Singapore into a city that nurtures homegrown media, enterprises and attracts direct foreign investments to Singapore’s media industry with its competitive skill sets and infrastructure. This will in turn lead to the creation of new jobs and add vibrancy to the Singapore economy. 

Singapore’s potential for growth as a media hub should not be underestimated. Global spending on entertainment and media in 2001 exceeded US$1trn and is expected to grow to US$1.4trn in 2006.2 Within this sector, media industries (TV, satellite, cable and station, and filmed entertainment) are expected to perform well with a projected compound annual growth rate of 6%. Media spending in the Asia Pacific in 2000 was estimated to be around US$215bn and is predicted that the region will experience a healthy growth of 5.3% on a compound annual basis. In Singapore, the local media industry, covering broadcasting, cinemas, publishing and printing services, music recording, digital and IT-related content services, had an annual turnover of S$10bn, contributing 1.56% to Singapore’s GDP and employing 38,000 people. In this respect, MDA functions as the regulatory authority in respect of the media in Singapore and strategically oversees the government’s realisation of Media 21. MDA was established under the Media Development Authority of Singapore Act (Cap 172) (‘MDAA’) on 1 January 2003 by the merger of the Singapore Broadcasting Authority, the Films and Publications Department, and the Singapore Film Commission.  

MDA regulates different forms of media ranging from broadcasting, film, the print media and the Internet by administering the following legislation: 

(i)         Broadcasting Act (Cap 28);
(ii)         Films Act (Cap 107);
(iii)        Newspaper and Printing Presses Act (Cap 206);
(iv)        Undesirable Publications Act (Cap 338); and
(v)         Public Entertainments and Meetings Act (Cap 257).

MDA serves, inter alia, the following roles: 

  1. promoting growth of the media industry by ensuring fair play and competition within the media industry. This will ensure that new entrants are not faced with high entry barriers and anti-competitive practices, especially from the dominant player within the industry; and

  2. managing content to protect core values and safeguard consumers’ interests.

We will now in turn briefly consider the most salient aspects of each legislation with a view to understanding how each of them regulates an aspect of the media in Singapore.

Broadcasting/film media

Broadcasting Act (Cap 28) (‘BA’)

Licensing under the BA

Under the BA, no one is allowed to provide any licensable broadcasting service in or from Singapore without a broadcasting licence from MDA.

‘Broadcasting service’ means a service whereby signs or signals are transmitted, whether or not encrypted, comprising:

(a)        any programme capable of being received, or received and displayed, as visual images, whether moving or still;
(b)        any sound programme for reception; or
(c)        any programme, being a combination of both visual image and sound for reception or reception and display

by persons having equipment appropriate for receiving, or receiving and displaying that service, irrespective of the means of delivery of that service. Examples of licensable broadcast services include free-to-air radio and television services, as well as subscription television and radio services.

Under the BA, the installation, importation, offering for sale and operation of any broadcast apparatus is also prohibited unless licensed by MDA. ‘Broadcasting apparatus’ means any apparatus capable of or designed or constructed for the reception of any broadcasting service. Under the First Schedule, broadcasting apparatus has been defined as a:

(a)        broadcast television receiver. This refers to any apparatus used for the aural and visual reception (in monochrome or colour) of any broadcasting service;
(b)        broadcast sound receiver. This refers to any apparatus used for aural reception of any broadcasting service; or
(c)        television receive-only satellite receiving system (‘TVRO’ system). This refers to any apparatus (including a dish antenna) capable of direct reception of any broadcasting service emitted from or passing through any communication or broadcast satellite in extra-terrestrial space.

It should be noted that, currently, there remains a blanket ban on the general ownership of satellite dishes in Singapore. This is to prevent the in-flow of undesirable content that may not accord with the values and mores of Singapore’s multi-racial and multi-religious society. However, MDA does allow hotels and selected educational institutions, alongside embassies and institutions that require time-sensitive information for business or operational purposes, to install TVRO satellite systems, subject to applying for a TVRO Systems Licence from MDA. There have, however, been recent indications that the blanket ban on satellite ownership may be reviewed.

Ownership and control of broadcasting companies

There are certain provisions in the BA which limit the ownership and control of broadcasting companies.

A ‘broadcasting company’ is defined as a company incorporated or registered under the Singapore Companies Act (Cap 50) holding any free-to-air licence or any broadcasting licence under which a subscription service may be provided, which permits broadcasts capable of being received by 50,000 or more dwelling houses.

Under the BA, a broadcasting company has certain special features, including a requirement that:

(a)        the appointment of its chief  executive officer (‘CEO’) or director or the chairman of its board of directors must be approved by MDA;
(b)        the CEO of the broadcasting company and at least one-half of its directors must be Singapore citizens;
(c)        a person may only become a substantial shareholder of the broadcasting company with the approval of the Minister;
(d)        a person may only become a 12% controller of the broadcasting company with the approval of the Minister; and
(e)        MDA must approve any funds from any foreign source (defined as either a foreign government, foreign company or a foreign person), which are received for the purposes of financing any broadcasting service owned or operated by the broadcasting company.

The above regulations are intended to ensure that broadcasting companies do not fall under the control of foreign influences, who may exploit the media to broadcast undesirable content that is not in accord with Singapore’s multi-racial and multi-religious society.

Codes of Practice

Under the BA, MDA is empowered to issue codes of practice relating to standards of programmes and advertisements broadcast by licensees. Every broadcasting licensee is expected to comply with the codes of practice.

MDA has issued various codes of practice, which cover radio, television as well as subscription television. In essence, these codes seek to ensure that nothing is included in the broadcast of these programmes which are against public interest or order, national harmony, or which offends good taste or decency.

Under the  advertising codes for  television and radio, broadcasters are expected to ensure that their advertisements are in line with current industry guidelines.

Films Act (Cap 107) (‘FA’)

The FA relates to the possession, importation, making, distribution and exhibition of films in Singapore. Under the FA, a film has been defined to include:

(i)         any cinematograph film;
(ii)         any video recording, including a video recording that is designed for use wholly or principally as a game; and
(iii)        any other material record or thing on which is recorded or stored for immediate or future retrieval any information that, by the use of any computer or electronic device, is capable of being reproduced or displayed as wholly or partly visual moving pictures.

Offences relating to obscene films

The FA creates a number of offences, especially in relation to the dealing, possession and advertising of obscene films. An obscene film is defined as a film which tends to deprave or corrupt persons who are likely to see or hear 
the film.

All films, whether locally produced or imported, have to be submitted to the Board of Film Censors (established under the FA), for the purposes of classification, and if necessary, censorship. The Board of Film Censors, upon receipt of a film by its owner for the purpose of censorship, may take one of the following actions:

(a)        approve the film for exhibition without alteration or excision;
(b)        prohibit the exhibition of the film; or
(c)        approve the film for exhibition with such alterations or excisions as it may require.

Classification of films

All films intended for exhibition and/or viewing must be approved by MDA which will classify a film into one of the following categories:

(a)        (G): General;
(b)        (PG): Parental Guidance;
(c)        (NC 16): No Children below 16-years-old;
(d)        (M18): Mature 18 for persons 18-years-old and above; and
(e)        (R21): Restricted to persons 21-years-old and above.

The above film categorisation, which was introduced on 1 July 2004, is intended to give wider choices to consumers, to enable them to make informed choices, and allow consumers access to video in their original content. Under the new system of classification, Mel Gibson’s ‘The Passion of Christ’, the controversial film surrounding the last few hours of Jesus Christ’s life, was the first film to be given the M18 rating.

Offence relating to party political films

There is a specific offence provided under the FA in relation to the importing, making, distribution and exhibition of party political films. A party political film refers to a film which is either:

(a)        an advertisement made on or behalf of any political party in Singapore; or
(b)        which is made by any person and directed towards any political end in Singapore.

The FA further clarifies that ‘a film is directed towards a political end in Singapore’ if the film, inter alia:

(a)        contains wholly or partly any matter which is intended or likely to affect voting in any election or national referendum in Singapore; or
(b)        contains wholly or partly either partisan or biased references to or comments on any political matter, including but not limited to, a current policy of the Government or an issue of public controversy in Singapore or a political party in Singapore or any body whose objects relate wholly or mainly to politics in Singapore, or any branch of such party or body.

However, any film made solely for the purpose of reporting current events, or informing or educating persons on the procedures and polling times for any election or national referendum in Singapore, is not a party political film for the purposes of the FA.

Print

Newspapers and Printing Presses Act (Cap 206) (‘NPPA’)

The NPPA regulates the print media industry in Singapore in relation to the establishment and operation of newspaper and magazine companies.

In Singapore, by virtue of the NPPA, you will need a:

(a)        licence to use the printing press to print documents which could be in the form of printed newspapers, printed pamphlets, leaflets, maps, charts, plans and includes any documents bound together;
(b)        permit to publish a newspaper in Singapore (including local periodicals);
(c)        permit to sell and distribute in Singapore newspapers that are printed or published in Malaysia; and
(d)        permit to sell and distribute foreign newspapers in Singapore.

The grant of the licence or permit to print and/or publish is completely at the discretion of the Minister. The license or permit is valid for a period of one year from the date of its issue.

Regulation of foreign newspapers

Foreign publications may come under the ambit of the NPPA if the Minister is of the view that a foreign newspaper is ‘engaging in the domestic politics of Singapore’, in that it makes what may be considered by the government to be inappropriate comment or criticism of government policies. The NPPA provides for the power to restrict the circulation of the publication in question for a period of time. In recent times, international newspapers such as the Asian Wall Street Journal have had their circulation restricted for contravention of the NPPA.

The rationale for the restriction is not to curb freedom of the press but to inflict economic repercussions through the restricted circulation which will have an impact on the foreign newspaper’s advertising revenue and profits of the offending publication.3

Ownership and control of newspaper companies

The NPPA imposes certain restrictions on ownership and control of a newspaper company. A ‘newspaper company’ is a public company limited by shares which has the following special features:

(a)        all its directors must be Singapore citizens;
(b)        there are two classes of shares, namely, management and ordinary shares; and
(c)        the management shares may not be issued or transferred except to citizens of Singapore or corporations approved by the Minister.

In addition, the NPPA restricts ownership of a newspaper company by requiring any person to seek approval from the Minister in order to become a substantial shareholder of a newspaper company or a 12% controller of the company, ie being in a position to control, whether directly or indirectly, of not less than 12% voting power in the newspaper company.

It is also an offence for any person, without obtaining the prior consent of the Minister, to receive on behalf of any newspaper, funds from any foreign source, whether a foreign government, foreign company or a foreign person. The Minister will give his approval if he is satisfied that the funds from the foreign source are intended for bona fide commercial purposes.

Undesirable Publications Act (Cap 338) (‘UPA’)

The UPA prevents the importation, distribution or reproduction of publications that are obscene and objectionable. A publication is deemed as obscene if it tends to deprave and corrupt persons who are likely to read, see or hear the matter contained or embodied in it.

A publication is deemed as objectionable if it portrays:

(a)        matters such as sex, horror, crime, cruelty, violence or the consumption of drugs or other intoxicating substances in such a manner that the availability of the publication is likely to be injurious to the public good; or
(b)        matters of race or religion in such a manner that the availability of the publication is likely to cause feelings of enmity, hatred, ill-will or hostility between different racial or religious groups.

Under the UPA, the Minister has the discretion to prohibit the importation, sale and circulation of any publication if the Minister is of the opinion that such publications are contrary to public interest. Publications which are banned are set out under a Schedule to the UPA titled ‘Undesirable Publications (Prohibitions) (Consolidation (Order)’. At present, there are over 250 publications which are banned, including men’s magazines such as Playboy and Mayfair.

However, MDA periodically reviews the list of banned publications, and at the appropriate juncture, may lift the ban on a publication. For example, on 2 September 2004, MDA decided to allow the sale and distribution of the adult-interest magazine Cosmopolitan, following the recommendation of the Censorship Review Committee 2002/2003 to allow the sale and distribution of publications with adult content, provided they do not contain exploitative sex and nudity.

Entertainment

Public Entertainment and Meetings Act (Cap 257) (‘PEMA’)

Formerly under the jurisdiction of the Singapore Police, the licensing of public entertainment now comes under MDA’s purview. PEMA provides for the regulation of public entertainment by requiring organisers of such events to apply for a licence.

No public entertainment shall be allowed  except in an approved place and in accordance with the licence issued by the Licensing Officer. Under PEMA, ‘an approved place’ refers to:

(a)        a place licensed to be used for public entertainment; and
(b)        a building, tent, street or any place whether open or enclosed approved for the purposes of holding public entertainment.

The Internet

The provision of Internet access and services comes within the ambit of broadcasting services under the BA and is regulated by MDA. Recognising that there is a limit to what domestic legislation can achieve in the face of the global and borderless medium of the Internet, MDA prefers an approach comprising joint government and industry initiatives as well as public involvement to encourage the development of the Internet.

Light-touch regulatory framework

MDA has adopted a light-touch approach in regulating services on the Internet. MDA’s regulatory framework for the Internet is embodied in the Broadcasting (Class Licence) Notification 2001, which contains regulatory requirements for both Internet Service Providers and Internet Content Providers. It is an automatic licensing framework and there is no need to obtain prior approval from MDA. Only those Internet Content Providers which have connection with political parties and those dealing with the propagation, promotion and discussion of political or religious issues relating to Singapore, will require registration. Under the Class Licence Scheme, Internet Content Providers and Internet Service Providers are deemed automatically licensed and have to observe and comply with the Class Licence Conditions and the Internet Code of Practice, which is issued by MDA.

Individual and industry self-regulation

MDA relies on self-regulation to manage content, which includes both individual regulation of the Internet and industry self-regulation.  

With regard to individual regulation, parents are encouraged to take the responsibility of monitoring their children’s usage of the Internet. MDA works with the Parents Advisory Group for the Internet (‘PAGi’), a volunteer organisation set up to respond to the needs of parents who are concerned as to their children’s use of the Internet. The aim of PAGi is to empower parents by equipping them with skills and knowledge to supervise and manage their children’s use of the Internet.  

With regard to industry self-regulation, under the Internet Code of Practice, licensed Internet Service Providers or Internet Content Providers are expected to block access to sites that contain or are concerned with prohibited materials when notified by MDA or to take their own initiative to do so. This relates to content which is pornographic or obscene or those that depict extreme violence and cruelty or incite racial or religious disharmony.  

In addition, the National Internet Advisory Committee (‘NIAC’), which was set up in 1996, advises MDA in respect of Internet regulation and industry development issues. The NIAC, which comprises a cross-section of industry members, seeks inter alia to: 

Sectoral competition regulation

A key feature of the MDAA is the power granted to the MDA to issue codes of practice and/or standards of performance to enable and maintain fair market conduct in any media industry in Singapore. Through these codes, MDA acts as the sectoral competition regulatory authority to ensure fair play and promote the growth of the media industry.  

On 1 April 2003, MDA issued a Code of Practice For Market Conduct in the Provision of Mass Media Services (broadcasting and print) (‘Code’) specifying the rights and obligations of participants in the mass media services markets. The Code is intended to promote fair market conduct and effective competition by laying out the ground rules for fair competition and also to encourage industry self-regulation in the mass media services markets in Singapore. The Code also addresses the issue of abuse of market power by dominant players.  

Under the Code, MDA has several enforcement mechanisms at its disposal to deal with those who contravene provisions of the Code, including imposing financial penalties of up to S$1m per contravention. 

Telecommunications Law and Regulation

The regulation of the telecommunications industry in Singapore

The Infocomm Development Authority of Singapore (‘IDA’) is the regulatory authority for the information and communications (‘infocomm’) industry in Singapore.

By the turn of the millennium, the convergence of information technology, telecommunications and content markets had become a reality and the Internet heralded new opportunities across all sectors. IDA, a statutory board under the ambit of the Ministry of Communication and the Arts (‘MICA’), was established on 1 December 1999, as a result of the merger between the National Computer Board and the Telecommunications Authority of Singapore to spearhead Singapore’s drive into infocomm which remains an engine of growth and a key enabler to other sectors of the economy. According to the World Economic Forum Global IT Report 2002-2003, infocomm is deemed a critical catalyst for social transformation and national progress.4 Infocomm is expected to be a powerful engine for economic development, and a critical enabler for all economic sectors such as manufacturing, logistics, education, healthcare, finance, biotechnology and media. Further, infocomm will continue to be an important value-adding component of consumer products such as TVs, cameras, cars and mobile telephone sets. Infocomm services are expected to grow at a robust pace over the next few years in Singapore and the Asia Pacific. Growing at 6.2% in 2002, Singapore’s infocomm services revenue is expected to grow more than 10% annually between 2004 and 2006.5 

The significance of infocomm cannot be sufficiently underscored. In short, infocomm is expected to move from being merely a productivity tool for the world of work to being a vital part of personal communications, entertainment and education — in other words, an indispensable part of Singaporeans’ way of life and way of making a living. 

The role of the IDA

The main functions and duties of IDA in relation to the infocomm industries are enshrined in the IDAA and include, inter alia, the following: 

(a)        to ensure that telecommunication services are reasonably accessible to all people in Singapore and are supplied as efficiently and economically as practicable and at performance standards that reasonably meet the social, industrial and commercial needs of Singapore; and
(b)        to promote and maintain fair and efficient market conduct and effective competition between persons engaged in commercial activities connected with telecommunication technology in Singapore. 

IDA administers the following legislation: 

  1. IDAA;

  2. Telecommunications Act (Cap 323); and

  3. Postal Services Act (Cap 237A).

We will consider the salient aspects of the IDAA and the Telecommunications Act in relation to: 

(i)         the regulation of the telecommunications industry in Singapore; and
(ii)         the promotion of competition within the telecommunications industry. 

Telecommunications Act (Cap 323) (‘TA’)

Licensing approach under TA  

The TA provides for the licensing and regulatory powers of the IDA in respect of telecommunication systems and services in Singapore. 

Any person who wishes to operate or provide telecommunications systems and services in Singapore must be licensed. IDA has adopted a two-pronged approach to differentiate between licences based on the nature of their operations, ie whether it is a facilities-based type of operations or a services-based type of operations.  

Facilities-based operations

A facilities-based type of operations refers to the deployment of any form of telecommunications networks, systems and facilities, to enable operators to offer telecommunications services to third parties, which may include other licensed telecommunications operators, business customers or the general public. Parties intending to deploy such operations will require an individual Facilities-Based Operator (‘FBO’) licence from IDA. An FBO Licence imposes conditions relating to service quality, access, interconnection, number portability and ownership, shareholding and management arrangements. Examples of telecommunications systems that are licensed include mobile communications systems (eg base stations, mobile switching centres) needed to offer public mobile phone, paging, trunked radio, mobile data services and fixed telecommunications systems (eg exchanges, fibre, ducts, submarine cables, frontier stations, international gateways) to offer services like local and international voice and data services, and leased circuit services. 

The IDA is also empowered to give directions, issue codes of practice and standards of performance to its licensees and other third parties where necessary. For example, IDA will award individual licences for FBOs based on the merits of the applications. All FBOs will be required to ensure interconnection, interoperability and access with all telecommunication licensees of the IDA. The intention is to ensure communications in a multi-network, multi-operator competitive environment for end-users who can access any services of any service provider regardless of which system the end-users are directly connected to.

Service-based operations

A services-based type of operations refers to operators who intend to lease any telecommunications system (including telecommunication network elements such as transmission capacity, switching services, ducts and fibre) from an FBO to be able to offer telecommunications services to third parties, or to resell the telecommunications services of FBOs. The service-based operators will have to apply for a Service-Based Operator (‘SBO’) licence. The guidelines for SBO licence issued by IDA list specific types of services which require such a licence, including virtual private network services, managed data network services and value added network services. This can be contrasted with content providers who provide services through the Internet but do not require an SBO Licence, such as banks who provide their customers with Internet banking facilities,6 online trading firms dealing in the trading of stocks and shares, and non-financial institutions such as eBay (the website wherein sellers are able to auction their items for sale).  

The SBO licence issued by IDA falls under two categories: the SBO (Individual) Licence category, whereby individual licensing is required for the stipulated types of operations and services; and the SBO (Class) Licence, which is classed-based. This means that anyone who provides SBO services within the scope of the class licence will be deemed to have read and agreed to the terms and conditions of the class licence (which are gazetted) and would be considered licensed. In general, interested parties will be required to register with the IDA before providing the service. 

Since the liberalisation of the telecommunications sector in April 2000, more than 30 FBOs and 600 SBOs have been awarded their respective licences to provide a diversity of infocomm services to businesses and consumers in Singapore.7 

In March 2003, IDA revised its licensing requirements for the SBO and FBO licences to boost competition. It lowered the market entry barrier for foreign businesses by lifting the local incorporation qualifying criteria from 
all SBO.

3G spectrum mobile communications rights

Third generation (‘3G’) mobile communications systems are expected to expand the frontiers of communication. Unlike its predecessors, namely first generation (‘1G’) communications systems (which offered simple wireless service based on analogue mobile technology of a low quality), and second generation (‘2G’) communications systems (which offered somewhat better voice capability, higher capacity, global roaming capability and support for simple non-voice services such as Short Messaging Services (‘SMS’)), 3G’s mobile communications systems and its accompanying mobile applications and services, will enable mobile devices to become more than just handphones. The potential capabilities of 3G systems include global roaming across 3G standards, high speed data transmission and the convergence of value-added data and voice services onto the same mobile device. This will dramatically change the way people communicate, work and carry out their daily lives.  

To provide 3G mobile communications services, a 3G operator will require the following licences and/or rights: 

(a)        a 3G Spectrum Right, which will permit the licensee to operate a mobile communications system for the purposes of providing 3G mobile communications services in Singapore;
(b)        an FBO licence; and
(c)        a Station/Network (Spectrum) Licence which will permit the licensee to use equipment referred to in the said licence within the radio frequency spectrum allocated to the licensee by IDA to provide 3G mobile communications services. 

These licences and rights are issued pursuant to the powers granted to the IDA under the IDAA, TA and the Telecommunications (Radio-communication) Regulations. An FBO licence and a Station/Network (Spectrum) Licence will be granted by IDA in addition to any FBO and station/network licence, which may already be held by SingTel, M1 or StarHub. 

On 23 April 2001, IDA awarded a 3G FBO licence and a 3G Spectrum Right each to SingTel, M1 and StarHub respectively. Each 3G Spectrum Right costs S$100m. The term of the 3G Spectrum Rights and 3G operator licences correspondingly granted will be until 31 December 2021. IDA has imposed a condition that SingTel, M1 and StarHub must ensure a nation-wide rollout of the 3G network by 31 December 2004. 

No restriction on ownership and control of telecommunications companies 

One of the most significant developments of the full liberalisation of the telecommunication industry has been the lifting of the direct and indirect foreign equity limits for all public telecommunications services licences. Previously, IDA imposed a maximum direct foreign equity limit of 49% on all major public telecommunications service licenses. The maximum indirect foreign equity limit on the local partner had also been 49%.  

Such a move is intended to encourage global infocomm players to participate actively in the Singapore market and to develop Singapore’s position as an infocomm hub in the Asia Pacific.

Sectoral competition regulations 

Under the TA, IDA is empowered to issue codes of practice and/or standards of performance in connection with the: 

(a)        operation of telecommunication systems and equipment;
(b)        provision of telecommunication services; and
(c)        conduct of telecommunication licensees in the provision of telecommunication services. 

On 29 September 2000, IDA issued the Code of Practice to ensure fair and effective market competition in the telecommunications sector. The provisions of the Code of Practice lay down a framework to promote 
competitive practices in the telecommunications sector and to ensure that new entrants are not deterred from entering the Singapore telecommunications market. 

Licensees must not act in a manner that can impede fair competition, such as engaging in predatory pricing. Where this occurs, IDA (either on its own motion or at the request of a private party) will initiate an enforcement action against the offending licensee, pursuant to the Code of Practice. If a licensee has complied with the applicable provisions contained in the Code of Practice, IDA generally will not intervene in a licensee’s day-to-day operations. 

To ensure competition, IDA establishes ground rules to pre-empt anti-
competitive practices. IDA promotes industry awareness of its policy decisions and regulatory actions, through publicising regulatory decisions on infocomm issues. As a recognition of IDA’s commitment to promote competition and transparency in its actions, the World Economic Forum 2001 identified Singapore as having the most transparent business practices in the world.8  

To maintain an open environment, IDA seeks public and industry views and feedback on its policies and regulations. Such communication channels come in the form of publicly released consultation and draft papers. Examples of public feedback includes the proposed consolidation of StarHub and SCV in May 2002, and most recently, in July 2004, public consultation on MDA’s proposed amendments to the TA. Through this review process, IDA aims to incorporate industry and public views in its decision-making process and ensure that its policies stay relevant in the global market place. 

IDA’s early successes 

In a report released by the World Economic Forum in March 2003, Singapore emerged as the third most-IT savvy country in the world, just behind Finland and the US.9 

In Singapore, the three mobile operators, namely, SingTel, M1 and StarHub, achieved interoperability for SMS in February 2002 and for multimedia messaging services (‘MMS’) in November 2002, making this a first in Asia. 

Entrenching Singapore’s status as a telecommunications hub

In order to maintain the price competitiveness of telecommunications services and pervasive international connectivity in Singapore, IDA goals are to:10  

Proposed amendments to the TA 

In July 2004, MICA released a public consultation document on the proposed amendments to the TA. The TA was last reviewed in 1999, prior to full liberalisation of the telecommunications sector, and since then there have been many significant developments. MICA has felt it is both necessary and timely to update the TA to enable it to adequately address the various issues arising in an increasingly competitive, multi-operator, multi-network environment within the telecommunications sector and beyond. 

Among the more significant proposed amendments are: 

  1. the proposed alignment of the competition provisions in the telecommunications sector with the proposed Competition Act expected to come into force in early 2005. At the same time, MICA is also cognisant of the importance of being able to reconcile differences in policy objectives under sectoral legislation, namely, the TA, and the proposed competition legislation;

  2. with regard to the control over certain designated telecommunication licensees, MICA proposes to introduce provisions to include a notification threshold at 5%, and approval thresholds at 12% and 30% in the shareholdings of designated telecommunication licensees. The designated licensees are required to notify, or seek IDA’s prior written approval for ownership changes.

Singapore’s New Competition Act

Singapore will be introducing a generic competition legislative framework sometime in early 2005 when the proposed Competition Act is enacted.12  

The proposed competition legislation aims to strike a balance between keeping Singapore’s economy open by promoting growth through scale, while on the other hand, assuring new entrants and competitors free access to a competitive market. It also aims to minimise the regulatory compliance cost for market players. 

The proposed Competition Act, however, expressly excludes the media and telecommunications sectors from its ambit. The rationale for such exclusion is that the media and telecommunications sectors already have their own sectoral competition regulatory frameworks. Another reason is that as there are many specificities and technicalities in the telecommunications and broadcast industries, it necessitates distinct and detailed sectoral competition regulation of their own.  

However, according to the Ministry of Trade and Industry, these exclusions are not intended to be indefinite. The exclusions will be reviewed by the Competition Commission after the competition legislation has come into force for a period of time, and after taking into account market developments and public consultations.

When the competition legislation comes into effect, in the event that any anti-competitive activity relates to more than one sector, and the respective sectoral regulators do not have the jurisdiction to act, the Competition Commission will investigate and act, in consultation with the relevant sectoral regulators. In this regard, the Competition Commission will soon issue guidelines on, inter alia, cross-sectoral competition case management. 

The Impact of Technological Convergence on Regulatory Convergence

Developments in digital technology have enabled traditional and new communication services (ie data, sound, moving and still pictures) to be delivered to consumers over a single delivery system. Technological convergence has arguably been one of the most important phenomena in the last decade. 

Convergence simply means that the information technology and software industry, the media and consumer electronics industry, the telecommunications industry and other media dealing with information and entertainment, are all approaching one another, jointly forming a completely new, huge digital industry. Internet voice telephony, internet access over mobile phones and broadcasting on the Internet are all examples of the convergence of various industries made possible through digitalisation of different media and the delivery of content. 

In the UK, technological convergence has resulted in regulatory convergence with the creation of the Office of Communications (‘OFCOM’) in the UK, which commenced operations on 29 December 2003.13  

OFCOM can be seen as a ‘super-sized regulator’ which aggregates nine separate regulators covering television, radio and telecommunications. It not only regulates the delivery of content (through broadcasting and telecommunications networks referred to as ‘infrastructure regulation’) but also the actual content delivered (through these broadcasting and telecommunications networks referred to as ‘content regulation’). 

Regulatory Convergence in Singapore

In Singapore, both MDA and IDA are themselves products of regulatory convergences. MDA was formed as a result of the merger of the Singapore Broadcasting Authority, the Films and Publications Department, and the Singapore Film Commission, while IDA was formed as a result of the merger of the National Computer Board and the Telecommunications Authority of Singapore. The rationale for the formation of the latter was to have a single agency for clear planning, policy formulation, regulation and industry development of the information technology and telecommunications sectors. 

In anticipation of the next phase of convergence between IT, telecommunications and broadcasting, IDA was moved to MICA to be side by side with MDA. By putting IDA and MDA under one Ministry to look after the local infocomm industry, it is intended that this will sharpen Singapore’s edge in attracting foreign investors. It will also be an opportunity for IDA and MDA to jointly develop Singapore’s infocomm industry.14  

Whether there will be a resultant rationalisation of all legislation governing media and infocomm industry and a subsequent aggregation of the telecommunications and media regulatory authorities, namely, IDA and MDA, under an umbrella authority which deals with both infrastructure as well as content regulation is an inevitable possibility. 

Conclusion

Currently, the respective legislative frameworks regulating the telecommunication and media sectors are quite comprehensive. Nevertheless, the respective legislations are constantly being reviewed (such as the current proposed amendments to the TA) to keep abreast with the developments within the telecommunication and media industries and to ensure the continued relevance of the legislative framework and competition guidelines. 

Jane Ittogi and Suhaimi Lazim
Shook Lin & Bok
E-mail: jane_ittogi@shooklin.com.sg and suhaimi_lazim@shooklin.com.sg

 

Endnotes: 

  1. At page 1.

  2. MDA, ‘Media 21: Transforming Singapore into a Global Media City’, page 2.

  3. Mr Wong Kan Seng, (Hansard: 1986-07-31, Vol 48 at Column 374).

  4. IDA, ‘Connected Singapore: A Blueprint for infocomm development’, page 4.

  5. Ibid at page 4.

  6. The Monetary Authority of Singapore (‘MAS’) has issued specific guidelines in relation to internet banking and internet trading. Please refer to http://www.mas.gov.sg/annual0001/ElectronicFinancial-annual-c.html.

  7. IDA, Annual Report (2002/2003), page 14.

  8. IDA, Annual Report (2002/2003), page 14.

  9. IDA, ‘Connected Singapore: A Blueprint for infocomm development’, page 8.

  10. Ibid, page 16.

  11. IDA, Annual Report (2002/2003), page 14.

  12. For those who wish a detailed analysis of the new Competition Act, please refer to the article by Jane Ittogi and Suhaimi Lazim, ‘Singapore’s New Competition Law’ in Global Competition Review, Vol 7, Issue 6, July 2004.

  13. For more information, please refer to OFCOM’s website at http://www.ofcom.org.uk/.

  14. Please refer to the article in The Straits Times titled ‘Infocomm agencies under one ministry’ (ST, 22 November 2001).