Telefonica files USD1 billion claim with ICSID over Mexican MTR reductions

27 Jun 2012

Spanish telecoms giant Telefonica has reportedly lodged a complaint with the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) in which it is seeking more than MXN14.737 billion (USD1.06 billion) from the Mexican government. According to Reuters, the complaint argues that Mexico’s telecom regulator has increased the cost of investing in the country as a result of legislation that has reduced the fees which Telefonica’s local wireless subsidiary Movistar Mexico can charge rivals to connect to its network. Such rulings, the filing reportedly claims, violate an investment treaty between Mexico and Spain. It is understood that Telefonica initially notified La Secretaria de Economia, Mexico’s economic ministry, of its intention to seek arbitration over the matter in September last year; the claim with the ICSID was filed last week.