MEXICO CITY -(Dow Jones)- The economy committee of Mexico's lower house of Congress has approved a bill that would ease restrictions on foreign investment in the telecommunications industry.
The proposed legislation - which has yet to go before the full house - would give the National Foreign Investment Commission the authority to allow foreign investment in fixed-line telephony above the 49% cap currently in place, according to a lower house press release.
"New activities aren't being opened to foreign investment, rather its participation would be increased in existing areas given the need for infrastructure and capital," the committee said.
The committee also said the National Foreign Investment Commission would have the discretion to approve greater investment in the sector based on the treatment of Mexican investors in the foreign investor's home country.
Telefonos de Mexico SAB (TMX), or Telmex, a former state monopoly controlled by Mexican billionaire Carlos Slim, owns about 90% of the country's fixed phone lines, with 17.7 million lines in service at the end of September.
Critics say Telmex's dominance in the sector is due in part to limits on foreign investment, which has made it difficult for smaller competitors to raise fresh capital.
Mexico has no such restrictions on mobile telephony, where Spain's Telefonica SA (TEF) owns the No. 2 operator.
A row between the two companies erupted last year after Telmex accused Telefonica of violating foreign investment limits through its stake in fixed-line operator Grupo de Telecomunicaciones Mexicanas SA.
Telefonica has said the company is majority owned by Mexican capital, and denies it is in violation of foreign investment laws.
-By Ken Parks, Dow Jones Newswires, 52-55-5001-5723, ken.parks@dowjones.com
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(END) Dow Jones Newswires
November 28, 2008 16:21 ET (21:21 GMT)

Publié le 28 novembre 2008 Copyright © 2008 Dowjones