‘Fresh slate’ contract negotiations to start next month

19 Sep 2007

Ecuador’s Telecoms Superintendent Paul Rojas said yesterday that contract renegotiations for foreign-owned mobile operators will begin next month, once sector policy maker Conatel finishes a review on whether the cellcos have met the terms of their existing contracts, with initial talks to be based on its findings. In a statement, Rojas said negotiations will not take into account previous studies carried out under a previous government. He stated that new contracts will establish minimum standards for quality of service and a system for determining infractions and sanctions to protect consumers. The contracts of Conecel (Porta Celular), a subsidiary of Mexico’s America Movil, and Spanish group Telefonica’s local unit Movistar (formerly BellSouth Ecuador and originally OTECEL), expire next year but include a 15-year extension option. If the government does not reach agreements with the two companies by December, it intends to launch a tender to select new operators. Ecuadorian president Rafael Correa threatened America Movil earlier this month that it must pay ‘overdue taxes’ or leave the country. Conecel and Movistar are currently subject to an inquiry by the national tax agency, due to finish in December.