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Argentina fines Telefonica of Spain $43M for service outage

Argentina has fined Telefonica $43 million for a mobile phone service interruption last month, which threatens to exacerbate tensions between the two countries.

Mobile phone in argentinaEnlarge
A cellphone displays software to get access to the web, email, chat and social networks in on March 15, 2012. (JUAN MABROMATA/AFP/Getty Images)

Argentina has fined Spanish telecom Telefonica $43 million for an hours-long mobile phone service outage last month -- a move that threatens to further strain ties between the two countries, according to The Telegraph.

The penalty was announced today and comes after Argentina seized control of domestic energy firm YPF from Spain’s Repsol.

About 18 million clients of Movistar, Telefonica’s wireless unit, were without phone and data services for several hours on April 2 due to technical problems.

According to the International Business Times, Telefonica must pay 10 pesos ($2.25) to each customer and about 6 million pesos to the government.

Movistar has about 40 percent of Argentina's mobile phone market, as well as six million landline accounts, Agence France-Presse reported.

Argentine Planning Minister Julio De Vido said the fine would send a strong message to other wireless providers that outages would not be tolerated, Dow Jones Newswires reported.

“Cellphone service quality has declined in recent months,” De Vido was quoted by The Telegraph as saying.

“We need to have full service, not service that gets worse when you walk a few meters one way or another.”

De Vido also called on telecom companies to boost investment in land lines, according to the International Business Times.

Argentina’s move to seize control of YPF has upset European leaders and on Monday European Union trade chief Karel De Gucht said the bloc would soon take action against the South American country, UPI reported.

More from GlobalPost: Argentina's oil grab: crude or shrewd?

http://www.globalpost.com/dispatch/news/regions/americas/argentina/120508/argentina-fines-telefonica-spain-43m-service-outage