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Liberalization of the Uruguayan telecommunications marketEstudio Bernstein, Montevideo

On August 31 the government submitted a bill to congress which, among others things, restricts the scope of ANTEL's exclusive control of "basic telephony", defined as local traffic effected through fixed telephones.

As of now, ANTEL (Administración Nacional de Telecomunicaciones), the national telecommunications company, benefits from exclusive control over certain telecommunication services which consequently have been excluded, up to now, from free competition. So far, although the precise boundaries of ANTEL's exclusivity over telecommunications services were far from clear, in practice it was accepted that it covered local and long distance telephone calls, as well as cellular services.

Pursuant to the bill, long distance telephone services, value-added telecommunication services and cellular operations would be excluded from the scope of ANTEL's exclusivity and therefore subject to free competition.

The bill also authorizes ANTEL to participate, with the prior approval of the government, in the capital of public or private companies, whether national or foreign, with the purpose of providing - with the exception of basic telephony as defined above - services related to the information and to the telecommunications industry. It further provides that the shares of such companies may be traded on stock exchanges in Uruguay or abroad.

The bill is part of the Uruguayan government's comprehensive policy aimed at liberalizing the telecommunications market. In recent times, the government has authorized several value-added and related services - mainly installation of teleports and local multi-point distribution services - and an international bid for the auction of a 1,900 MHz band for personal communication cellular services has already been announced.

Jonás Bergstein and Gabriel Ejgenberg

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