Mexico telecoms watchdog informs targets of antitrust push

Reuters

MEXICO CITY, Dec 4 (Reuters) - Mexico's telecoms industrywatchdog said on Wednesday it has informed the companies it willassess for tougher regulation, likely the first step in takingmeasures against phone giant America Movil andbroadcaster Televisa.

The Mexican government has so far focused its drive to boostcompetition on the telecoms sector, which has become a potentsymbol of entrenched interests in the country.

America Movil, controlled by multi-billionaire Carlos Slim,has roughly 70 percent of the Mexican mobile phone market, andabout 80 percent of the fixed-line business. Televisa meanwhilehas more than 60 percent of the TV market.

Earlier this year, Congress passed a reform that gives thenew Federal Telecommunications Institute (IFT) sweeping powersto impose anti-trust measures on dominant players.

IFT president Gabriel Contreras said at an event in MexicoCity that the companies who could be subject to the new regimehad been notified. He declined to name them because it is up tothe companies to identify themselves in the process.

President Enrique Pena Nieto's reforms gives the IFT thepower to break up telecoms companies that are found to beimpeding competition. However, Contreras said last month thatoption is only intended to be used as a last resort.

The IFT can also apply a range of other measures to spurcompetition, including forcing dominant players to shareinfrastructure or creating a price regime to aid smaller rivals.

The IFT has until early March to determine which firms are"predominant" and America Movil had already said it expected tobe targeted under the new legislation. It is widely anticipatedthat Televisa will be subject to a tougher regime too.

Two officials at America Movil said they did not know if thecompany had been notified by the IFT and two others did notimmediately respond to requests for comment.

A Televisa official said a process of information exchangehad begun with the IFT over the issue of predominance.

America Movil and Televisa have spent years battling effortsto impose tougher rules on how they operate, using legalinjunctions and appeals to thwart regulators. Much of that legalcover has been stripped away by the new reform.

The companies can present their own cases against beinglabeled predominant and they are expected to put forward a rangeof arguments to blunt the regulator's efforts.

Secondary legislation to implement the telecoms reform hasbeen delayed, giving the likely targets more time to preparetheir defences. Congress is expected to begin looking at thesecondary legislation in February.

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