Bloomberg News

Mexico Telecommunications Bills Said to Face Debate Before Oil

January 30, 2014

Mexico’s Congress will take up bills to implement last year’s telecommunications overhaul at the start of its session next week, with legislation to build upon constitutional oil-industry changes set for later in the month, according to two people with knowledge of the plans.

Laws defining rules for investment in Mexico’s energy industry, where an amendment to the constitution ended Petroleos Mexicanos’s seven-decade monopoly last month, will be presented in the second half of February, according to the people, who asked not to be identified because the plan hasn’t been made public. The session runs from Feb. 1 through April.

The telecommunications legislation will probably be sent by President Enrique Pena Nieto as a preferential initiative, giving each chamber one month to vote on it, according to one of the people. Amid debate on electoral and energy overhauls last month, Congress missed a Dec. 9 deadline to pass new regulations for the telecommunications industry.

Secondary laws to implement a political overhaul allowing for re-election of federal lawmakers may also be presented before the additional energy legislation, according to one of the people. Gustavo Madero, president of the opposition National Action Party, or PAN, last year made passage of a constitutional political overhaul a prerequisite for debate on the charter’s energy changes, which the PAN supported.

“In order for the constitutional reforms to crystalize, they need reforms of laws and regulations, and once the regulatory laws are applied we expect to begin to see results” from last year’s overhauls, Manlio Fabio Beltrones, lower house leader of Pena Nieto’s Institutional Revolutionary Party, or PRI, told reporters in Mexico City on Jan. 28.

Define Rules

Mexico last year enacted an energy law to allow private producers to pump crude for the first time since 1938, and lawmakers must now define rules for their investment, such as the share of profit companies will reap from Mexico oilfields.

Congress must also establish new regulations for the phone and broadcast television industries after approving changes in 2013 that would increase competition for America Movil (AMX:US) SAB and Grupo Televisa SAB. (TV:US)

America Movil, controlled by billionaire Carlos Slim, has about 70 percent of Mexico’s mobile-phone customers and almost 80 percent of its landlines. Televisa gets about 70 percent of Mexico’s broadcast-television audience.

Both were identified as dominant companies in a preliminary finding in December. They have an opportunity to challenge the Federal Telecommunications Institute’s initial finding of dominance, which by law must be finalized by March 9.

To contact the reporters on this story: Eric Martin in Mexico City at emartin21@bloomberg.net; Nacha Cattan in Mexico City at ncattan@bloomberg.net

To contact the editor responsible for this story: Andre Soliani at asoliani@bloomberg.net


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Companies Mentioned

  • AMX
    (America Movil SAB de CV)
    • $19.54 USD
    • -0.15
    • -0.77%
  • TV
    (Grupo Televisa SAB)
    • $33.06 USD
    • 0.03
    • 0.09%
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