Telefonica seeks compensation from Mexico

The Spanish operator Telefonica has lodged a claim for over US$1 billion in damages against Mexico, claiming that regulatory changes made by the Central American country over the past few years have adversely affected both its revenue and investment plans.

The group claims that these regulatory changes contravene a treaty between Mexico and Spain aimed at protecting investment, and is seeking the assistance of the World Bank's International Centre for Settlement of Investment Disputes (ICSID).

The operator’s MEX14.737 billion (US$1.06 billion) claim is an attempt to offset revenue lost between 2006 and 2011 as a result of Mexico reducing its mobile termination rate (MTR). This lowered the amount that operators could charge rivals for connecting to their networks.

However, a recent statement from Telefonica confirmed that recent rulings in Mexico’s courts concerning the interconnection fee would prove beneficial to the company. The same statement noted: "We hope that a solution will be found quickly."

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