Challenges to the Effective Implementation of Competition Policy in Regulated Sectors: The Case of Telecommunications in Mexico Symposium on Competition Law and Policy in Developing Countries

Solano, Oliver, del Villar, Rafael, Garcia-Verdu, Rodrigo | January 1, 2006

This article reviews Mexico’s competition law and policy, with particular emphasis on the challenges that the Federal Competition Commission (“CFC”) has faced in implementing an effective competition policy. Some of the difficulties analyzed are the loopholes in the current laws, the lack of cooperation between the CFC and other sectoral regulators, and the regulatory arbitrage by market participants. These challenges are then illustrated by the developments in the telecommunications sector. This sector is particularly interesting in the case of Mexico given the overwhelming power of the dominant firm and the overlapping and even conflicting mandates of the different government authorities overseeing the sector. The article concludes with a series of specific policy recommendations aimed at improving the effectiveness with which the competition authority in Mexico implements competition policy.