Preserve rather than eliminate IFT

From the beginning of his term, President Andrés Manuel López Obrador has mentioned the disappearance of the Federal Telecommunications Institute (IFT) as an autonomous constitutional body. This intention, currently supported by President-elect Claudia Sheinbaum, has caused concern in the telecommunications sector, broadcasting, digital and technology industries, as well as defenders of the right to access and to a hearing in information and communications technologies (ICT).

AMLO first mentioned the possibility of abolishing the IFT in a press conference on January 7, 2021, arguing that the autonomous organization is a burden on public finances, a result of neoliberalism, and does not achieve its goal of ultimate monopoly.

This simplistic and ideological vision fails to take into account the fundamental role played by the IFT in regulating and overseeing the telecommunications and broadcasting sectors, which are strategic for Mexico’s economic and social development.

The IFT is responsible for implementing the 2013 constitutional reforms on telecommunications and economic competition and the 2014 federal telecommunications and broadcasting laws.

The agency was conceived under the idea of ​​a new regulatory state, with autonomous, independent, technical and professional characteristics, so that regulatory decisions are made primarily on the basis of technical and apolitical criteria, although it would be naive to assume that political factors have been excluded from decision-making.

The demise of the IFT will have an impact on the telecommunications and broadcasting industries as it means that regulatory decisions are automatically politicized.

In the package of constitutional and legal initiatives presented by President López Obrador on February 5, 2024, and in the opinion of the Constitutional Essentials Committee of the House of Representatives, it is mentioned that the regulatory functions of the IFT will be within the “Secretariat of Infrastructure, Communications and Transport (SICT), which is responsible for the development and implementation of telecommunications and broadcasting policies”.

In this department of the federal government, which will be headed by Jesús Esteva Medina in the new government, “issues concerning the granting, revocation and authorization of the transfer or change of control of shares, ownership or operating rights” of companies related to radio broadcasting and telecommunications concessions will continue to be resolved.

With the IFT, the granting and revocation of concessions became a technical procedure, while when it was handed over to the SICT, it became a political process.

The lack of an independent regulator (remember, the Federal Economic Competition Commission is also under consideration) could foster anti-competitive behavior, affecting consumers with higher prices and less choice and quality, including for digital services.

The institutional design of an autonomous, independent, technical and professional agency like the IFT is superior to a subordinate or decentralized model of the federal government. The IFT’s independence is essential to its effectiveness and credibility, enabling it to make decisions based on the public interest rather than political agendas.

It would be more advantageous to retain the IFT and strengthen institutional coordination and collaboration with President Sheinbaum’s federal government on telecommunications and digital public policy than to have the IFT disappear.

Giving regulatory and policy decisions to the federal government through the Ministry of Infrastructure, Communications and Transport has adverse effects because we already know this pattern. Decisions may be influenced by the political interests of officials and the economic interests of companies, affecting the fairness and equity of the market.

The disappearance and lack of an independent regulator has once again brought uncertainty to the industry and the market, affecting investment in the industry.

Claudia Sheinbaum The government and the IFT must engage in dialogue to achieve the goal of interconnected Mexico and shared digital prosperity, rather than destroying the IFT. Collaboration between the government and the Tourism Institute can strengthen digital public policies and guarantee an efficient regulatory environment.

The disappearance of the IFT would also have repercussions within the framework of the Treaty between Mexico, the United States and Canada (TMEC): it would violate the commitments made by Mexico in the treaty, which would trigger international litigation and affect commercial relations, primarily with the United States.

If Congress approves the repeal of the IFT, there will be legal and judicial consequences, such as the possibility that affected companies will file international lawsuits under the USMCA and other trade agreements. Not only will it trigger constitutional disputes questioning the legality of the measure. At the same time, various actors can file unconstitutional lawsuits with the nation’s highest court, seeking to overturn the ruling.

The demise of the IFT would be a setback to an institutional design that has been outdone. The independence and autonomy of the Tourism Institute are fundamental principles for increasing efficiency in the telecommunications and broadcasting sectors. There is political advantage for the government and the IFT to work together to align public policies, strengthen regulation, promote digitalization, and share digital prosperity for all Mexicans.

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Twitter: @beltmondi