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Mexican Government Outlines Second Phase of Telecoms Reforms

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The second phase of legislation to reform Mexico's telecoms and broadcast markets has been unveiled by the country's President.

Mexico's newly created Federal Telecommunications Institute recently declared America Movil to have a market dominance, which was fully expected as it controls around 70% of the market.

"With this law we will have more competition," Deputy Communications Minister Jose Ignacio Peralta told reporters yesterday in Mexico City. "The concentration we find in this market will be more balanced among competitors. It will give clarity to our laws, and it will incentivize new entrants."

The second phase legislation could also see dominant operators required to phase out their long distance charges and some other consumer costs.

Domestic long-distance charges must be eliminated within three years under the proposed legislation.

The new regulator will also be given powers to fine companies up to 10 percent of their revenue if they breach the new rules. That is a considerable hike on the previous limit of just USD1 million per infraction.

The new bill needs to be passed by Congress, although that is expected to be a formality as politicians on all sides have agreed that reforms are necessary.

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Tags: america movil  Mexico