Court strikes down US$1b fine against AMX subsidiary
Regulators have voted to rescind a record US$1-billion fine imposed against the Mexican cellphone company owned by the world's richest man, Carlos Slim, in exchange for a series of concessions meant to ease the company's lock on the national market.
The Federal Competition Commission says it rescinded a fine of almost 12 billion pesos (US$1 billion) levied against cell carrier Telcel in April 2011 in exchange for the company's agreement to charge competitors less to connect calls to Telcel users.
Telcel is promising to lower the interconnection charge from 95 centavos (US seven cents) a minute to 30.94 centavos by 2014.
Lower cross-service rates
Telcel will make these rates available to any competitor, and will also allow its customers to call people inside and outside the cellphone network for the same price.
Telcel will also have to drop all litigation against the commission and pay a fine equivalent to eight per cent of its annual revenues if it doesn't comply with the deal, the commission said.
The regulator described the deal as a way of creating immediate benefits for consumers and ending a costly legal struggle between the commission and Telcel.
Parent company America Movil is controlled by Mexican magnate Carlos Slim, whose fortune is estimated at US$69 billion.
Telcel has about 70 per cent of the Mexican cellphone market. The regulatory commission has estimated consumer loss related to high cellphone interconnection charges at US$6 billion a year.