Competition watchdog growls at America Movil

MEXICO CITY (Reuters) - Mexico's competition watchdog has ruled that the local unit of cell phone giant America Movil could be subject to more regulation to prevent abuse of power over consumers.

The Federal Competition Commission said America Movil's Telcel network wields "substantial power" in Mexico due to its massive market share.

America Movil, controlled by billionaire Carlos Slim and competing in Mexico against Telefonica SA, is Latin America's biggest mobile phone company.

"We do not agree with this ruling," Daniel Hajj, the company's chief executive, told reporters on Wednesday night.

"We do not use abusive practices. We understand their reasoning; we will review the decision and reply in due time."

Being classified as a "substantial power" could make America Movil, which operates in 17 countries, subject to additional regulation on prices and practices to bolster industry competition.

The decision, reached in late October, may be appealed by the company, a source at the commission told Reuters on Wednesday.

(Reporting by Tomas Sarmiento; editing by Jeffrey Benkoe & Kim Coghill)