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The NEW telecommunications market in Costa Rica

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Rules being published for Telecom firms


For The CAFTA Report

(Oct. 17, 2008) The nation's public services regulatory agency is publishing the first three sets of rules for telecom companies. The lengthy documents will be in the official La Gaceta newspaper today, the agency said.

This is the next step in the process of opening the telecommunications market to companies other than those contracted by or belonging to the Instituto Costarricense de Electricidad, which held the former government monopoly.

The three sets of rules cover universal access, competitivity and the interconnectivity of communications  systems here.

The agency, the Authoridad Reguladora de Servicios Públicos, said it drew up the rules after a series of public meetings at which 200 persons attended and some spoke,

The rules are amplifications of a law, the Ley General de Telecomunicaciones, passed by the Asamblea Legislativa. The law was part of the changes the government promised to make as part of the free trade treaty with the United States, Central American and the Dominican Republic.
  
The law created new entities whose acronyms soon will be a part of the Costa Rica lexicon. There is the Superintendencia de Telecomunicaciones, known as SUTEL, which is the highest authority in this area. It is made up of elements in the Ministerio de Ambiente y Energía, which will be known as the  Ministerio de Ambiente, Energía y Telecomunicaciones.

The  Superintendencia, among other duties, will control the Fondo Nacional de Telecomunicaciones (Fonatel), which will use a 1.5 to 3 percent tax on communications services to support universal access.

Hannia Vega Barrantes has been named vice minister of Telecomunicaciones. She had been vice minister of Planificación.

One argument raised by the  Instituto Costarricense de Electricidad over the proposed telecom bills was that it had to provide access everywhere, even to places where the terrain or distances made such services unprofitable. It worried that newcomers might cherry pick the most profitable locations and target them. The law and the new rules require companies to provide services even where they are not profitable.

The Fondo Nacional de Telecomunicaciones  is a way to compensate them, and the new rules provide elaborate details far beyond what is in the law.

The rules on competition are directed against monopolistic practices, linked sales and other ills of the open market. Much of the text comes from the law.

The interconnectivity section contains a lot of technical details and requires telecom companies to be transparent in the technology they use so that other companies can use the networks. It also requires the companies to keep their networks in good condition.

The Authoridad Reguladora also sets the prices of public services, but the country still is a long way from having a local competitor for the  Instituto Costarricense de Electricidad.




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