Mexico's lower house OKs telecommunications overhaul bill

Mexico City, Mar 23 (EFE).- Mexico's lower house of Congress has passed an ambitious telecommunications overhaul bill aimed at boosting competition, breaking up dominant players and opening the door to greater foreign investment.

The legislation would create a new autonomous body, the Federal Telecommunications Institute, or Ifetel, to regulate the use of spectrum and oversee broadcasting and telecommunications networks and the services delivered on them.

Ifetel also would be charged with granting and revoking broadcast and telecommunications concessions.

If the proposed regulatory changes become law, companies that control more than 50 percent of their markets could be forced to shed assets.

Large telecommunications firms controlled by multi-billionaire Carlos Slim, the world's wealthiest individual, also may have to pay higher fees to connect to their rivals' networks than what they will be allowed to charge.

The bill also would allow up to 100 percent foreign investment in telecommunications and up to 49 percent foreign investment in broadcast media.

It was approved by a 414-50 vote early Friday in the lower house and will now be sent to the Senate, where it is also expected to pass. President Enrique Peña Nieto has said he hopes to sign the bill into law before the end of next month.

The bill, submitted to Congress by the federal government on March 11, stems from the so-called Pact for Mexico, a political agreement signed by the governing Institutional Revolutionary Party, or PRI, the National Action Party, or PAN, the Party of the Democratic Revolution, or PRD, and the Ecologist Green Party of Mexico, or PVEM.

The overhaul is expected to affect Slim's telecommunications empire since Telcel and Telmex, wireless and fixed-line units of his America Movil company, control 70 percent and 80 percent of their respective markets in Mexico.

It also could disrupt Mexico's broadcast television duopoly of Grupo Televisa and TV Azteca, which control 70 percent and 30 percent of that market.

But, if enacted, the overhaul is expected to boost economic growth in Mexico.

In a report last year, the Organization for Economic Co-operation and Development said the lack of sufficient competition in Mexico's telecommunications sector costs the economy $25.8 billion annually (an amount equivalent to 1.8 percent of the country's gross domestic product).