The bill sent to Congress fleshes out a constitutional reform
approved last year that seeks to curb the power of phone mogul
Carlos Slim and the country's top broadcaster, Televisa.
The regulator, the Federal Telecommunications Institute (IFT), will
have sweeping powers to order companies to sell assets, revoke
concessions and share networks and infrastructure, according to the
bill sent to the Senate.
It will have the power to levy fines of up to 10 percent of revenue
in Mexico in the case of a repeat offense. It will also be able to
force companies to seek approval annually for interconnection and
infrastructure-sharing terms, in line with a draft obtained by
Reuters last month.
Major market players like billionaire Slim's phone and Internet
giant America Movil, his fixed-line operator Telmex and TV
broadcaster Televisa have been declared dominant by the regulator.
"The most important part of this is more competition,"
communications and transport secretary Gerardo Ruiz Esparza told
local radio. "What the (bill) says is that for there to be more
competition, we need to ensure there is no dominance in the market."
The telecoms overhaul, a central plank of a wider raft of economic
measures ranging from taxes to energy that Pena Nieto pushed through
Congress last year, has raised hope the government is serious about
finally breaking the stranglehold of a select few over Latin
America's second biggest economy.
Slim, who became one of the world's richest men after taking control
of Mexico's former state telephone monopoly at the outset of the
1990s, controls around 80 percent of Mexico's fixed-line business
and about 70 percent of the mobile sector.
Televisa has more than 60 percent of the TV market, and many
Mexicans complain it exerts too much political influence.
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Mexico's radio and television industry group said in a memo to
members that some aspects of the bill imply "new and severe"
regulatory burdens for the broadcast sector, according to a
It said some measures translated into over-regulation and could
be subjective and editorial independence could be compromised by the
imposition of a code of ethics. It also cited unduly harsh fines and
legal uncertainty regarding concession extensions.
The IFT has ordered Slim's companies to present plans to cut rates
for rivals using America Movil's mobile network, scrap roaming
charges, open up the fixed-line network and share transmission
towers as well as other infrastructure.
However, the IFT has not ordered a break-up of his operations, a
step the regulator says should only be taken as a last resort.
(With reporting by Elinor Comlay, Gabriel Stargardter, Michael
O'Boyle and Adriana Barrera; Editing by Simon Gardner and David
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