(Updates with details from latest version of laws)
By Dave Graham
MEXICO CITY, March 19 Mexico will send
legislation to Congress this week to flesh out a reform that
seeks to curb the power of telecoms mogul Carlos Slim and the
country's top broadcaster, Televisa, a senior lawmaker said on
Slim and Televisa have dominated their industries in Mexico
for years, and one aim of the shake-up is to cut their share of
the market to below 50 percent.
Emilio Gamboa, Senate leader of the governing Institutional
Revolutionary Party, or PRI, said the so-called secondary laws
to implement the government's overhaul of the phone and
television markets will be presented this week.
The last regular working day for Congress this week is
Thursday, and a PRI official told Reuters that that was the day
the secondary laws, which were originally supposed to be passed
by December, were likely to be presented.
According to a version of the secondary laws dated March 19
seen by Reuters, the legislation will give Mexico's new telecoms
regulator extensive powers to police dominant telecommunications
companies, right down to the prices and discounts they offer.
The Federal Institute for Telecommunications (IFT), which
was created by last year's reform, will be able to force phone
companies to seek approval every year for interconnection and
infrastructure-sharing terms, the document showed.
Slim became one of the world's richest men after taking
control of Mexico's former state telephone monopoly at the start
of the 1990s. Today he controls around 80 percent of the local
fixed-line business and about 70 percent of the mobile sector.
Televisa, meanwhile, has over 60 percent of the TV market,
and many Mexicans complain it has too much sway over politics.
But the broadcaster's economic power lags far behind Slim.
The March version of the secondary laws was slightly longer
than an earlier draft seen by Reuters in February. It offered
more detail on the scope of fines, but upheld the broad sweep of
powers the regulator will have to go after Slim and Televisa.
Under the telecoms reform, the IFT will have powers that
extend right up to being able to order asset divestitures.
The local mobile and fixed-line units of Slim's telecoms
company America Movil, as well as his rival
broadcaster Televisa, the world's largest
Spanish-language content producer, were declared dominant by the
IFT earlier this month, making them the targets for a battery of
The IFT said Slim's companies must present plans to lower
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 non-electronic
But the IFT did not order a break-up of his operations, a
step the regulator says should only be taken as a last resort.
The IFT has said it could begin to repeal measures against
the dominant players once their power has been substantially cut
back, and the secondary laws outlined one way it may happen.
"The predominant economic player will cease to have such
character when the (IFT) determines that its national market
share, considering the variables used to declare it predominant,
have been reduced below 50 percent," the document reads.
CONCENTRATION OF POWER
The telecoms overhaul has raised hope that the government is
serious about reducing the concentration of power enjoyed by a
few families in Latin America's second-biggest economy.
The reform is a central plank of a wider batch of economic
measures ranging from taxes to education and energy that
President Enrique Pena Nieto pushed through Congress last year.
The 2013 telecoms reform already ensures that Televisa will
face more competitors due to the planned auction of new TV
The secondary laws bound for Congress go into particular
detail on how the government wants to cut Slim down to size.
A range of offers from the dominant telecommunications
player, including promotions and discounts, will only be
authorized with the IFT's direct approval, the laws say.
The regulator will have the right to make the dominant
player seek annual approval of a range of services for other
companies connecting to its infrastructure and network.
Many of the powers detailed in the secondary laws existed
under Mexico's old telecoms law. But the former industry
regulator, known as Cofetel, was unable to apply them because
companies were able to file injunctions preventing the previous
antitrust body, Cofeco, from declaring them dominant.
The new telecommunications reform made IFT the highest
authority on antitrust issues in telecoms and broadcasting,
while separate legal changes mean companies can no longer
suspend regulatory decisions pending appeal.
(Additional reporting by Tomas Sarmiento, Elinor Comlay and
Christine Murray; Editing by Peter Galloway and Jan Paschal)