Mexico is pushing forward with a constitutional reform package that proposes the extinction of IFT and Cofece, the autonomous bodies regulating telecommunications, broadcasting, and economic competition. This reform could be voted on shortly.
The purpose of the constitutional amendment is to simplify organic regulation and regain control of it under the federal executive branch. Under the new system, the Ministry of Economy will solely address economic competition issues, with telecommunications regulatory issues addressed by the Ministry of Infrastructure, Communications and Transportation,
Constitutional autonomy currently allows both IFT and Cofece to not be hierarchically dependent on the government, headed by the President. Consequently, they are empowered to act in strict application of the rule of law without political or organic control. This is relevant in cases that require regulation of activities controlled by the federal government, especially those related to energy.
In the case of telecommunications and broadcasting, the government’s activity is limited. Under the current system, most of it is carried out by private entities that operate under the figure of licenses and authorisations. The only case that has taken on special relevance is that of the Red Compartida, in which the government has increased its participation to focus on being a provider of wireless telecommunications services, as well as increasing service coverage in rural areas.
Independence, impartiality, and transparency
Given the transfer of powers from IFT and Cofece to ministries that are dependent on the president, it is essential that subsequent modifications made to the legal framework guarantee the independence and impartiality of decisions on regulatory matters.
One of the aspects that has been widely highlighted to generate trust is the transparency with which decisions are made and the availability of information that is offered to the public. This creates predictability in regulation and promotes the development of new and better services.
Control mechanisms
Likewise, if the previous balance is broken, control mechanisms must remain in place for judicial matters to generate confidence in due adherence to the rule of law. In this regard, it stands out that at the same time as this reform, a constitutional reform of the judicial branch is also being proposed. It is essential to guarantee the existence of specialised courts in telecommunications and competition matters that count on specialised personnel. Judges must also operate with full autonomy.
Human resources
A critical aspect to be considered as an effect of this constitutional reform is the human resources capacity of both IFT and Cofece. These teams are the ones who carry out the main work to resolve the procedures, requests, and regulations and who enable new services, inspections, supervision, and sanctions to provide certainty for the development of activities for the benefit of Mexico. Any adjustment in future operations must consider the effect on the regulation of the sectors involved.
What it means for Mexico
A government’s job is to identify ways to generate the greatest benefit for its country. However, changes such as those developed in Mexico can generate uncertainty for industries and regional stakeholders.
On the other hand, authorities can also foster confidence should an independent and impartial regulatory operation be guaranteed. For this, predictability, transparency, consistency, timely decisions, and capable human resources are crucial. Such a major change needs to be supported by control mechanisms that guarantee accountability and full adherence to the rule of law.
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Access Partnership makes innovation work for the world. As Mexico prepares for a new government, we are uniquely positioned to help your organisation navigate the intricacies of the Mexican and wider Latin American policy landscape while upholding fairness, innovation, inclusivity, and sustainability.
To learn how your business can overcome Mexico’s regulatory reforms and leverage opportunities in this evolving landscape, please contact Geusseppe Gonzalez at [email protected] and Fernando Borjón at [email protected].
