Telmex fined $51.6 million for anticompetitive practices

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Telmex, the Mexico-based wireline subsidiary of America Movil (NYSE: AMX), has been fined MXN 657 million (USD 51.6 million) by the Comision Federal de Competencia (CFC) for engaging what the regulator says is anticompetitive practices.

The fine, Bloomberg reports, follows an investigation the CFC conducted on wholesale lines Telmex sells to competitive service providers that operate in Mexico, such as Axtel.

The agency said that Telmex did not provide services to Axtel, which operates in 32 cities and six intercity routes, for two years.

Telmex, which has 30 days to appeal the decision, told Bloomberg that it is still reviewing the CFC's ruling and that evidence it provided to the regulator had not been "properly taken into account."

As the country's incumbent operator, Telmex controls almost 80 percent of Mexico's phone lines, while its parent America Movil holds 70 percent of the wireless market.

Mexico's recently elected President Enrique Pena Nieto has said that opening up the country's telecom market to more competition is a priority for his administration.

In recent years, Telmex's wholesale practices have come under increased regulatory scrutiny. Last March, Cofetel mandated that the service provider incorporate price and quality controls on wholesale services it sells to competitive service providers.

Besides focusing its attention on Telmex, the Mexican government has auctioned leases on state-owned fiber lines from state-owned utility Comision Federal de Electricidad (CFE) service providers can use to build networks in unserved areas.

For more:
Bloomberg has this article

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