Mexican senator proposes merging COFECE, IFT, and CRE under INMECOB

LatamList – Senator Ricardo Monreal, the Mexican Senate Majority leader, recently proposed a bill that integrates the Mexican energy, antitrust, and telecommunications regulating agencies under one entity. 

With the approval of this bill, the CRE, COFECE, and IFT would become the Instituto Nacional de Mercados y Competencia para el Bienestar (INMECOB). Currently, the IFT regulates telecommunications, while the COFECE monitors antitrust laws, and the CRE regulates energy. 

The INMECOB would be a constitutionally autonomous entity that would focus on investigating markets, guaranteeing competition, and combating monopolies.

Monreal claims that the fusion would save $22.8M (MXN$500M) a year by creating synergies that would help streamline highly bureaucratic processes. 

According to the bill,

“[…], although the two authorities of economic competitiveness (IFT and COFECE) apply the same law, the fact that they operate independently implies the possible creation of different criteria when evaluating competition policies, for example, in the analysis of possible monopolistic practices or authorizations of acquisitions”. 

Monreal mentions the dispute over the Uber-Cornershop acquisition as a case in which the divisions between the entities proved to be blurred.  The integration of these entities will help create a unified set of standards for dealing with these cases. 

President Andrés Manuel López Obrador argues that many members of these regulating agencies were appointed by previous administrations that support the “neoliberal” model that privatizes industries at the expense of the public good. However, it is unclear whether the president will support the bill. 

Some sectors have expressed concerns regarding the integration of these three autonomous bodies, especially when their resolutions could be politicized by including sectors such as the energy sector.

The International Chamber of Commerce (ICC) Mexico considered that the constitutional reform proposed by Senator Ricardo Monreal would carry more risks than economic benefits. They highlight that the greatest risk would be the transformation of these technical bodies into political instruments. 

According to the Mexican Association for the Right to Information (AMEDI), the merger of the regulators aims to deprive IFT of autonomy and management capacity, violates fundamental rights, and seeks political control over directors and regulated sectors. 

AMEDI also expressed that the initiative replaces the technical and impartial selection process, currently established in Article 28 of the Constitution, with a political-legislative-partisan procedure that would detract from the autonomy of the new institution.

Read more on the original bill or on Infobae.

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