Principles of International Economic Law by Matthias Herdegen

Author:Matthias Herdegen [Herdegen, Matthias]
Language: eng
Format: epub, pdf
Publisher: OUP Oxford
Published: 2016-10-05T18:30:00+00:00

Under specific commitments, so-called reference papers substantiate the undertaken obligations. In this context, the elimination of certain practices restricting competition plays an important role. Thus, the reference papers, though only to a limited extent, vest WTO law with an antitrust dimension.

In Mexico—Telecoms,9 the Panel Report established a breach of competition law obligations under the GATS for the first time. The dispute referred to a rather peculiar regulatory interplay between the Mexican authority for telecommunications and the largest telecommunications company in Mexico (Telmex). Mexican regulation entrusted the Mexican carrier with the regulatory fixing of fees for transferring incoming international calls.

Telmex established a schedule of minimum fees for all foreign telecommunications service providers. All other domestic operators were not allowed to charge less than the established fees for interconnecting calls. In addition, shares of the domestic market for international calls were determined by quotas, according to the rate of incoming international calls (regardless of outbound overseas calls). This system resulted in a kind of antitrust charging system and an anti-competitive allocation of market shares.

According to the Panel Report, Mexico had infringed its commitments under the Annex on Telecommunications (section 5 (a) and (b)). In addition, Mexico had committed itself in its reference paper to take reasonable measures to prevent anti-competitive practices by providers with a dominant position and to ensure cost-oriented rates for the interconnection of calls. The Panel found:

Mexico has not met its obligations under Section 5(a) of the GATS Annex on Telecommunications since it fails to ensure access to and use of public telecommunications transport networks and services on reasonable terms to United States service suppliers for the cross-border supply, on a facilities basis in Mexico, of the basic telecommunications services at issue. […] Mexico has not met its obligations under Section 5(b) of the GATS Annex on Telecommunications, since it fails to ensure that United States commercial agencies, whose commercial presence Mexico has committed to allow, have access to and use of private leased circuits within or across the border of Mexico, and are permitted to interconnect these circuits to public telecommunications transport networks and services or with circuits of other service suppliers.10

Regional agreements such as the Comprehensive Economic and Trade Agreement (CETA) and the agreement on the Trans-Pacific Partnership (TPP) contain rather extensive provisions on telecommunications services.

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