The Mexican Senate has approved a major telecommunications reform bill recently introduced by president Enrique Pena Nieto. However, the Senate’s version of the bill comes with certain modifications, Bloomberg reports.
The Senate’s bill version stipulates that companies regulated by the Federal Economic Competition Commission can request temporary injunctions against fines and forced asset sales. Those changes will not apply to telecommunications and media companies, who will be fined and can be broken up by a newly-created agency, the Federal Telecommunications Institute, whose decisions cannot be suspended.
The proposal also defines the legal options for America Movil and Grupo Televisa, the nation’s largest phone and media companies, imposing stricter rules and scrutiny. While the bill allows the companies to go to court to overturn decisions, they will not be able to suspend regulations while judges review their cases, a delaying strategy that operators have used in the past.
The proposal also gives the Communications and Transportation Ministry 45 days to issue a nonbinding opinion on decisions by the Federal Telecommunications Institute.
The bill also allows foreigners, for the first time, to take majority stakes in landline phone and cable networks in Mexico, a measure which mainly seeks to create more competition for America Movil. It also calls for the creation of new television channels to compete with Televisa. Carlos Slim's America Movil currently controls nearly 80 percent of Mexico’s fixed line market and 70 percent of the domestic mobile market. Televisa has a 60 percent share of Mexico’s TV market.
The new telecommunications and antitrust agencies created by the legislation will have greater power to issue fines, force companies to share assets and even require the breakup of dominant carriers.
The changed bill will now return to the lower house of Congress for final approval.
