The regime's authorities on Monday granted a rare to a new telecommunications company that will start operating in nine months, the communications minister said.
Wafa Telecom will become Syria's third telecoms operator in a market currently controlled by and MTN.
Iyad al-Khatib said in a press conference that he hoped that the new company will "improve the reality of cellular communications in Syria, especially after its infrastructure was damaged" in the country's civil war.
He said that the new firm was locally funded and estimated it would cover at least 30 percent of the Syrian telecom market.
The European Union added Khatib to a sanctions list in 2019 for his role in Syrian dictator President Bashar al-Assad's "violent repression" of civilians.
Wafa Telecom CEO Ghassan Saba said the company relied on foreign expertise, amid reports of Iranian investments in his firm.
Al-Khatib dismissed the reports of or other foreign funding.
Syriatel is the country's biggest telecommunications company and accounts for 70 percent of the market.
It was founded by business tycoon Rami Makhlouf, a cousin of Assad who made headlines in 2020 after criticising the regime in Facebook videos.
Makhlouf was forced to step down from the company after the government ordered Syriatel to pay more than $180 million to the treasury.
MTN's core market is Africa. It announced in 2020 that it was seeking to exit the Middle East market and was in talks to sell its 75 percent stake in MTN Syria.