MEXICO

On January 3 the Federal Telecommunications Institute (IFT in Spanish) presented the document Advocacy and Promotion of Competition in the Telecommunications and Broadcasting Sectors where it presents the working points that it will promote in 2022 to promote free competition in these sectors. There will be studies on the functioning of the over the top (OTT) market. The text assures that for now they do not consider imposing any binding regulation, but clarifies that this information will be useful to determine the entity’s strategy for 2025. 

The document explains that the IFT, in addition to regulating, will also seek to carry out activities to defend and promote free competition in the sectors it regulates through non-binding measures. For 2022, it can be mentioned:

• Study on OTT services for audiovisual and audio content.  The study will provide information on the evolution, current status and economic conditions prevailing in this sector. Its preparation will be based on public information and will provide a conceptual framework for a better understanding of the operation of these services. It will also allow for a diagnostic of the competitive dynamics of the markets in which they participate.

• Study on digital platforms and business models. The purpose of the study is to identify the relevant variables and to have methodologies to determine the market shares of digital platforms that allow evaluating possible anticompetitive conducts, barriers to competition or essential market inputs. For its elaboration, the business models of the most representative digital platforms will be reviewed. The results will be used to make the work of the IFT’s Investigating Authority more efficient.

Following the publication of this document on advocacy, the IFT published on January 10 the Report on Over The Top (OTT) Digital Platforms, which highlights the explanation of their operation, their connection with Telecommunications and Broadcasting (T&R in Spanish) services and networks, and the existing regulation on the matter in Mexico. Finally, the document states that the IFT is the competent authority to know and resolve T&R matters, which would reach OTT Digital Platforms, since the entity recognizes them as new technologies with similar technical characteristics that are currently unregulated or have little regulation.

Regarding the regulation on the matter in Mexico, the entity explains that, although there is little and it is focused on tax issues, there are bills of interest. The text highlights the initiative of Ricardo Monreal (MORENA – ruling party) which, in addition to regulating the payment of Value Added Tax, established an obligation for pay TV service providers via the Internet to provide a screen quota of at least 30% of national content. This text has been without movement in the Senate since March 2020 and it is not expected that its debate will be resumed in the short term. Finally, it mentions the initiative presented at the beginning of 2021 that seeks to create the “Federal Law for the Protection of Digital Users”. This initiative could be considered again at the beginning of the next regular session in February 2022.