Cofetel puts forward regulatory proposals aimed at limiting Telmex’s dominance

14 Sep 2011

Mexican telecoms regulator, the Comision Federal de Telecomunicaciones (Cofetel) has reportedly issued new legislation aimed at curbing the power of the country’s dominant fixed line operator, Telefonos de Mexico (Telmex), Reuters is reporting. While an earlier attempt by the watchdog to introduce regulation that would have meant tighter rules for the telco was scuppered by legal challenges, Cofetel has pressed on with its latest efforts, sending the newly proposed legislation to the Comision Federal de Mejora Regulatoria (Cofemer), the country’s federal regulatory improvement commission. Little information has been revealed about the proposals other than that they aim to prevent dominant companies from restricting network access to rivals and look to foster competition in Mexico’s telecoms sector. The proposed regulations will subsequently be opened up to comment from industry experts, academics and the general public, and subject to changes and improvements based on recommendations, but no timeframe has been detailed for the conclusion of this process.

The announcement comes just a few weeks after the Comision Federal de Competencia (Cofeco), Mexico’s antitrust watchdog, confirmed an earlier finding of dominance with regards to the fixed line incumbent. As previously reported by CommsUpdate, in early September, having been required to review findings that America Movil’s (AM’s) local fixed line and wireless units – Telmex and Telcel – were dominant in their respective sectors, Cofeco reiterated a previous ruling that Telmex was indeed dominant in the market for the completion of calls to fixed lines, with the watchdog revealing that commissioners had voted unanimously to uphold the decision. The regulator noted that the ruling only established that Telmex has substantial market power however, stressing that it did not imply the existence of monopolistic practices, but it did note that the confirmation of its position meant that Cofetel was therefore in a position to apply asymmetrical tariffs and other regulations to the incumbent.