The Communications Regulatory Authority of Namibia has proposed increasing the telecommunications regulatory levy to 2.25% of industry turnover over the next five years as it seeks to recover an estimated N$118 million funding shortfall and stabilise the regulator’s long-term finances.
The proposal comes as the current 1% levy, introduced in 2021 following consultations with industry players, has failed to fully cover the cost of regulating Namibia’s communications sector.
According to CRAN, the original recommendation was for a 1.5% levy, but this was reduced after engagements with industry stakeholders, resulting in continued under-recovery.
Speaking during the regulatory levy review process, CRAN executive for economics and market development Helene Vosloo said the regulator had under-recovered approximately N$181 million over the past five years.
However, she said N$63 million linked to settlement agreements and payment arrangements with certain licensees had already been excluded from the amount recoverable from the broader industry, leaving a net under-recovery of around N$118 million.
“Turning to the financial position: the levy review covers the period from 2020 to 2021 onwards. The original budget assumptions were set during that period, but changes in the industry and implementation challenges resulted in delays and adjustments. Over this period, we recorded an under-recovery of approximately N$181 million. Following settlement agreements with certain licensees, N$63 million has been deducted, as some operators were unable to meet obligations. After adjustments, the total under-recovery over the five-year period stands at approximately N$118 million,” she said.
Vosloo said the proposed 2.25% levy would generate around N$829 million over the next five years, slightly above the estimated N$823 million required to fund future regulatory operations and recover accumulated shortfalls.
CRAN said any over-recovery would legally have to be returned to the industry, while any future deficits would again need to be recovered through subsequent levy reviews.
The regulator also proposed a lower 1.25% levy for broadcasting licensees, citing weaker financial performance and declining revenues within the broadcasting sector compared to telecommunications operators.
“Broadcasting and telecommunications sectors were treated differently due to differing market conditions. Telecommunications revenues continue to grow, while broadcasting revenues are stagnating or declining. Postal services are also in decline globally,” Vosloo said.
She defended the move to replace the current glide-path methodology with a fixed percentage levy system, arguing that the proposed model aligns with international best practice and would provide greater certainty for both the regulator and industry players over the next five years.
Vosloo also said the new model would reduce reliance on a few major operators such as Telecom Namibia, MTC and MultiChoice Namibia, which have historically carried a significant share of the sector’s regulatory costs.
CRAN warned that continued under-recovery could force even steeper levy increases in future, potentially rising to 3.5% or higher if corrective measures are delayed.
The authority said the proposed changes are aimed at ensuring sustainable funding for the communications regulator while stabilising regulatory costs across the sector.
