Mexico court chides Slim on telecoms tariffs

MEXICO CITY: Mexico's America Movil, part of billionaire Carlos Slim's telecoms empire, cannot resort to injunctions to stifle the telephone watchdog's efforts to promote competition, the Supreme Court ruled on Tuesday.

Slim's fixed-line and mobile telephone services dominate the Mexican market, resulting in some of the highest phone bills for consumers in the industrialized world, and the ruling could go some way to weakening the tycoon's grip.

America Movil's Telcel unit operates the largest mobile phone network in Mexico and charges its rivals interconnection fees to complete calls, which competitors say are too high.

The Federal Telecommunications Commission, or Cofetel, steps in to fix the interconnection fees when the two sides cannot mutually agree. But Telcel typically wins court injunctions against Cofetel to sideline its efforts, sometimes for years in Mexico's dysfunctional justice system.

"It is not acceptable to suspend the interconnection tariffs that the Federal Telecommunications Commission fixes," the court said in a statement.

Cofetel recently fixed the interconnection fees for completing cellular phone calls at 0.3912 pesos a minute, or about 3 cents, below Telcel's best offer of 0.95 pesos.

Mexico's Federal Competition Commission fined America Movil $1 billion in April, after a four-year investigation concluded that the company abuses its dominant position in the market.

America Movil denies any wrongdoing and has appealed the fine. Slim, the world's richest man, has said his rivals should invest more in their own networks rather than expect bargain prices from Telcel.