Reuters: Regulatory News: UPDATE 1-Mexico lower house backs telecoms reform, Senate awaits

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UPDATE 1-Mexico lower house backs telecoms reform, Senate awaits Mar 22nd 2013, 15:19 Fri Mar 22, 2013 11:19am EDT MEXICO CITY, March 22 (Reuters) - Mexico's lower house of Congress approved a sweeping reform of the telecommunications industry early on Friday, sending legislation that aims to curb Carlos Slim's dominance of the phone market to the Senate without making major changes. The reform bill, which also seeks to curb the power of Mexico's main broadcaster, Televisa, is intended to open up the long closed industry to more foreign competition and give regulators the power to compel dominant companies to sell assets. Since Mexican President Enrique Pena Nieto unveiled the plan at the start of last week, shares of Slim's phone giant America Movil and Televisa have taken a hit. Pena Nieto's reform would give regulators the power to force companies with more than 50 percent of a market to dispose of assets. America Movil has about 70 percent of the Mexican mobile business and 80 percent of the fixed line market. Televisa has roughly 60 percent of the broadcasting market. Mexico's Senate will now discuss the bill, and lawmakers in Pena Nieto's ruling Institutional Revolutionary Party, or PRI, say they believe it should pass before the current session of Congress concludes at the end of April. Lawmakers in the lower house made some amendments to the bill, agreeing to tighten the planned opening of Mexico's TV and broadcasting sector to foreign investment to what other countries permit in their respective markets. The initial bill allowed foreign investors to take up to 49 percent ownership of TV or radio operators. The parties also agreed to change a section granting the president the right to give an opinion on the awarding of concessions. Instead, the minister of communications will do this. On Thursday, America Movil's shares recovered some ground after investors were encouraged by the possibility Slim, the world's richest man, could profit by entering Mexico's TV market, which he has been kept out of so far. After the markets closed on Thursday, America Movil said it had obtained the exclusive broadcast rights in Latin America, except Brazil, for the 2014 winter Olympic games as well as the 2016 summer Olympics. Shares of America Movil rose by more than 1.5 percent in early trading on Friday, while Televisa was barely changed. Link this Share this Digg this Email Reprints

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