Mexico’s state legislatures support telecoms reforms

30 May 2013

Having gained the support of Congress earlier this month, legislation designed to enhance competition in the Mexican telecoms sector has been approved by more than half of the country’s state legislatures. In order to be finalised, the new regulatory measures needed to be given the nod by at least 17 of the 32 state legislatures before becoming law, as it requires changes to Mexico’s Constitution. In the event, 24 of the 32 approved the bill, with those being: Aguascalientes, Baja California Sur, Campeche, Chiapas, Chihuahua, Coahuila, Colima, Durango, Guanajuato, Hidalgo, Jalisco, Mexico, Morelos, Nayarit, Puebla, Queretaro, Quintana Roo, San Luis Potosi, Sonora, Tamaulipas, Tlaxcala, Veracruz, Yucatan and Zacatecas. According to Bloomberg BNA, with the overarching regulation now having been approved, it is now expected that a number of secondary laws designed to underpin it will be implemented. The bill itself, meanwhile, has been sent to President Enrique Pena Nieto, with the head of state likely to sign it before the end of this month ahead of its publication in the Official Gazette of the Federation.

As previously reported by CommsUpdate, under the new legislation a new telecoms regulator – Instituto Federal de Telecomunicaciones (Ifetel) – will be created, with the new body to have the power to order those companies adjudged to dominate their market to sell off assets. The new entity will also be able to limit companies from seeking to stall competition through continued litigation, with special courts expected to deal with regulatory disputes, and prohibit companies from blocking regulatory decisions through legal means while they are being challenged in court. The new regulatory body is now expected to be in operation by the end of 2013, while its first rulings are likely to be issued in the first half of 2014; under the new law, Ifetel has six months from the date it is set up to determine which companies are dominant in their respective markets, and to take necessary measures to guarantee competitive conditions. Meanwhile, the revised regulation will also lift restrictions on foreign ownership on companies providing fixed line telecommunication services, while the government is planning to set up a state-run carrier of carriers to help it meet its target of ensuring 70% of homes and 85% of businesses have access to the internet.