Convergencia Research, Consultoría especializada en Latinoamérica y Caribe
Monday, March 08, 2021

A 2021 under new rules of the game

For the upcoming months, intense activity is expected in relation to the passive infrastructure sharing regulation, the general one for pay television services through physical and/or radio and satellite link, and a single access simplification system in which the Secretary of Public Innovation works to accelerate deployments at the municipal level.

The ICT sector is not outside regulatory developments among New Year's Eve-Toasts, and 2020 maintained the custom: it reached its decline with numerous resolutions longed-for by the industry. Regulation on DNU (Presidential Decree) 690 may have been the most bombastic and undoubtedly the one generating the most headlines and controversies due to the push and pull of the increases, but for the upcoming months, intense activity is expected in relation to the passive infrastructure sharing regulation, the general one for pay television services through physical and/or radio and satellite link, and a single access simplification system in which the Secretary of Public Innovation works to accelerate deployments at the municipal level.

Regarding DNU 690, Resolution 1466/20 authorized a rate increase of 5% (which was later brought to 7% for SMEs and cooperatives with less than 100,000 accesses) and Resolution 1467/20 presented the so-called Prestación Básica Universal, PBU (Universal Basic Benefit).

In both cases, market reactions were critical. The companies wanted authorization for an average increase of 20%, whereby they rejected the 5% finally granted,and with the restart of judicial activity in February the judicialization of the measure began. With the precautionary measure of Tv Cable Color SA of Villa del Rosario, in Córdoba, admitted by a local federal court, without a single doubt, a new stage of filing of precautionary measures opens. Although, as Enacom clarified, court decisions of this type are only valid for the specific case and not for the rest of the industry.

Among the processes filed before Justice, are those of Telecentro and DirecTV, to obtain the declaration of unconstitutionality of DNU 690, rejected in November 2020; that of Telecom, which requested the suspension of some articles, and the absolute nullity of others, but a dissenting judgment was passed on last January 29; and that of Telefónica Móviles, which joins the request for a declaration of unconstitutionality, and is still pending judicial resolution.

Sharing as a trigger for other rules.  The Passive Infrastructure Sharing Regulation, which became valid through Resolution 105/20 in mid-December, was one of the demands of companies that operate ICT services, without differences in size or geographic location. While these regulations are beginning to be applied, Government is making progress in drafting a law that will seek to address other of the important demands of the sector: the bureaucratic problems arising in the municipalities for companies that want to operate in those territories

The ICT undersecretary, Martín Olmos, advanced the news to Convergencialatina but reserved the details that are under full negotiation. As he told, government's intention is to have the law passed before year-end.

The strategic orientation of the regulation aims to improve competition from an efficient use of infrastructure in line with the rest of the national government's sectoral policy. The officer stressed that from the Presidency there was a political will to move forward with the issue that was pending since DNU 762 of 2000: "it is argued that we must move forward with sharing to pay off a historic debt," he summed up.

The regulation was worked out from the management of Cambiemos, in which there were two public consultation processes with the participation of private parties, public officers and independent specialists, from industry and cooperatives. “It is true that the Sharing Regulation is not going to solve all the infrastructure deployment problems”, Olmos acknowledged. "That is why we are also working on updating the infrastructure deployment rules so that ICT licensees have all the prerogatives of other sectors".

The details are still kept in confidence: “We are currently in the internal discussion of government, seeking to unify criteria. The municipalities' networks are interconnected and we want that it be possible to pass from one jurisdiction to another without impediments. It is a federal network”. Beyond the aspects still being defined, Convergencialatina was able to know that work is being done on a common criteria single access simplification system, in order to facilitate deployment at the three governmet levels: the imperative is to simplify and facilitate. An incentive scheme for municipalities that most facilitate deployment is also discussed.

From the industry there were inquiries from many operators for the details of the regulation. “We have permanent dialogue with all ICT sectors and we have received inquiries from cooperatives. The comments from the small providers or from the ‘incoming’ actors are very positive”, said Olmos. However, by the end of January the officer did not know if there were processes initiated or dialogues between licensees, specific projects, after the publication of the regulation. “The idea is that the parties reach an agreement. Now there is a regulatory framework that is an incentive”, he concluded. The sources consulted at Enacom preferred not to discuss the matter.

The approach of the upcoming law seems to coincide with the criteria of the specialists, who state that the sharing problem does not have so much to do with the big companies such as Telecom, Telefónica or Claro as with small operators and municipalities or with electric providers.

25 items for passive infrastructure sharing

-It classifies passive infrastructure into two groups: ducts, trenches, pipelines and chambers installed in urban and suburban areas, on the one hand; and poles, antenna support structures, shelters, buildings, sites, plots, air conditioning systems and other accessories that serve as support or facilitate the installation of active infrastructure elements, on the other.

-The Enacom will be the enforcement authority. Its interpretations must be governed by the principles of: efficient use of passive infrastructure; sustainable urban planning; promotion of competition; provision of information by licensees; confidentiality of that information; freedom of contract; obligation to allow access to other licensees; nondiscrimination; good faith; and subsidiarity. It may intervene at the request of either party, if the requested party does not respond to the request of the applicant, if the licensee refuses to provide the information that the other party requires, if the former unjustifiably delays access after approval or if later out of the 30-day period, no agreement was reached between the parties. It may intervene ex officio to avoid distortions in competition and discrimination.

-Obligations of ICT service licensees: allow access to passive infrastructure to those who demand it; reserve capacity for the installation of new ducts and shelters; not agreeing exclusivity with other actors; inform the installed infrastructure whether or not it is owned. 30-day period to grant access.

-Cases in which ICT licensees will be exempted from complying with the obligation to allow access: technical infeasibility of the infrastructure; risks to the integrity and security of the licensee's network; and lack of availability of capacity in the infrastructure requested.

Telecommunication installations in real estate. It states that ICT service licensees “may not enjoy exclusivity in the installation of telecommunications infrastructure elements inside buildings, plots or real estate made up of several disposable units or exclusive domain both in the use of their common spaces and in matter of provision of services within the same, having to facilitate the sharing to the existing passive infrastructure to the licensees that request it”. The buildings and subdivisions must have the common infrastructure for access to ICT services to guarantee the owners of the units free contracting and reception in accordance with the regulations.

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