Telecoms sector revamp bill enters parliament for discussion

4 Nov 2014

An Ecuadorian parliamentary committee, La Comision de Gobiernos Autonomos, has approved a report of the first debate on the country’s draft Telecommunications Act with ten votes in favour and two against, and the bill will now be presented to the National Assembly for discussion, reports TeleSemana. The bill contains rules ‘to ensure universal service’ including a new revenue percentage contribution, the scale of which is dictated by subscriber market share, stipulating that companies with a market share of between 35% and 75% pay a revenue percentage of between 1% and 9%, according to local news source Telegrafo.com.ec. This additional payment excludes state-owned operator CNT but includes foreign-owned Claro and Movistar. In the committee debate, Teodoro Maldonado representing market leader Claro – which under the bill must pay fees of 7% of revenue as per operators with 65%-plus subscriber market share – called the measure a ‘discriminatory tax’ which ‘violates some constitutional principles’. Claro has hinted that further investment in mobile networks will be curtailed if the new regulatory regime is implemented.

TeleSemana adds that the bill also regulates rights and obligations of users of telecommunications services and providers, such as the right to have quality services, privacy of personal data, free calls to emergency services, eliminating call rounding rates, and unlimited validity of user top-up balances, among others. The new legislation provides that the regulator has the ability to set price caps for telecommunications services. It also proposes a scheme of fines in proportion to the income of the offender, the proceeds of which go directly to the state budget.

Furthermore, according to the bill, the central government shall be responsible for the administration, regulation, management and control of telecommunications and radio spectrum. The Ministry of Telecommunications will act as lead agency and a new entity, the Agencia de Regulacion y Control will work alongside the Superintendencia de Telecomunicaciones to perform control and management functions, replacing an existing regulatory system administered by dual regulators Conatel and Senatel.