In the same way that we reviewed the regulatory events in 2016, at this time we will review the regulation of telecommunications in Peru during 2017, taking into account that, in June 2017, we reviewed what the pending regulatory agenda in Peru was.

Institutional framework

The year began with the proposal of Osiptel to establish the guidelines for regulatory quality (January 11), in order to prove that its rules are justifiable, reasonable, legal, beneficial and efficient. However, as far as I know, after Osiptel extended the deadline for submitting comments, this draft has not been approved yet. Despite this fact, in practice, Osiptel has been following the methodology indicated in its proposed guidelines.

Continuing with the topic of the regulatory impact analysis, the Presidency of the Council of Ministers (PCM) published the “manual for the application of regulatory quality analysis” (August 2), which is addressed to the rules issued by the public entities of the Executive Branch that are of general scope and establish administrative procedures (with the exception of laws or rules with the rank of law). The objective of all the rules linked to this manual is to achieve administrative simplification.

In the field of telecommunications, this manual would imply the revision of the Single Texts of Administrative Procedures (TUPA) of the Ministry of Transport and Communications (MTC) and Osiptel.

Thus, the MTC modified its TUPA to simplify 89 administrative procedures and eliminate 14 administrative procedures (November 28). Subsequently, the MTC modified its TUPA again (December 27), in order to simplify 36 administrative procedures and eliminate 4 administrative procedures.

It should be noted that the Legislative Decree No. 1246 (October 2016) already had the purpose of simplifying, optimizing and eliminating administrative procedures. It is within this framework that the MTC modified the Single Ordered Text (TUO) of the General Rules of the Telecommunications Law in order to make the requirements for granting concessions for the telecommunications service more flexible (February 28).

It was also at the beginning of the year (February 12) that the PCM approved the “National Strategy of Government Open Data of Peru 2017-2021” and the “Government Open Data Model of Peru”. In this context, the MTC created the Sectoral Commission “MTC Digital”, in charge of leading and promoting the digital transformation of services and procedures provided by the transport and communications sector (October 4).

Another topic that generated much expectation at the beginning of the year was the succession of the presidency of Osiptel. Gonzalo Ruiz left the presidency for the period 2012-2016, and many names were called to succeed him in the next period 2017-2021. After the selection process was declared void for mysterious reasons, the lawyer Rafael Muente was elected in a second call.

In this new period, the economist Sergio Cifuentes, Manager of Regulatory Policies and Competition, held the interim position of General Manager (June 2) and, later, was appointed General Manager of Osiptel (December 5). As far as I know, it has not been published who would be the replacement to occupy the position of Manager of Regulatory Policies and Competition.

It should be noted that the PCM modified the Organization and Functions Regulation (ROF) and Organization Chart of Osiptel (April 14), adding functions to many areas and incorporating changes in the organization of the Administration and Finance Management and of the Supervision and Management Supervision.

The new functions and organization of the Administration and Finance Management were grounds for modifying the Regulations of Contribution for Regulation to Osiptel, in order to establish the competent body for the issuance of administrative tax acts.

On the side of the MTC there were also moves: Bruno Giuffra replaced Martín Vizcarra (May 26) as Minister of Transport and Communications. For his part, the former Vice Minister Carlos Valdez resigned from office on December 28, and, although Mariela Paredes initially was appointed as his replacement from January 7, 2018, on January 7 this designation was rendered null and void.

On November 17, the MTC presented the bill to Congress in order to create the Vice Ministry of Information and Communication Technologies (Vice Ministry of ICT). It was then said that the approval of the draft would take between one and two months of discussion. However, at that time, the entire process of presidential vacancy that would shake the country during the month of December was not known, and, consequently, the aforementioned draft is far from being a priority in the congressional agenda.

Another draft presented by the MTC was the National Broadband and ICT Policy (November 28), where it established plans for each of the four components of the digital ecosystem (infrastructure, services, applications and users), with goals by 2021. The approval of said draft is pending.

Finally, due to a pending issue concerning the methodology of the payment of the fee for the use of the radioelectric spectrum, the MTC published a draft to modify the TUO of the Rules of the Telecommunications Law (December 6), with the purpose of considering, in the calculation of this fee, criteria that value, among others, the use of the allocated bandwidth for the Public Teleservices, instead of the current calculation that considers the quantity of mobile terminals activated.

Infrastructure

2016 closed with the Osiptel draft on complementary rules for rural mobile infrastructure operators (OIMR). Osiptel extended the deadlines for comments in January, and it was not until April 28 that Osiptel finally approved these complementary rules to regulate the OIMRs, establishing a generic regulation instead of a specific tariff regulation. Since then, there has been no public information regarding the results that the OIMRs would be showing in the market, such as the case of the operator Mayu.

On the other hand, the Law N° 29904 of 2012, “Law for the Promotion of Broadband and Construction of the National Dorsal Fiber Optic Network (RDNFO)”, establishes that electric power and hydrocarbon companies will provide access and use of its infrastructure to the concessionaires of telecommunications services, in exchange for a payment according to a methodology imposed by the MTC.

Due to the fact that the prices of these payments were above the market prices, the MTC presented a proposal to modify the parameters of its model in order to adjust the payment to the market prices. This discussion took a long time, since the initial draft was presented on February 18, later modified on July 20, to finally be approved on August 5.

On the other hand, on March 13, Osiptel set the remuneration for the provision of the complementary facilities of the RDNFO: lease of poles, ducts and channeling, and co-location of equipment.

Along that line, Azteca (concessionaire of the RDNFO) presented its technical proposal for the provision of its complementary access facilities to the Regional NAP to be included in the Basic Access Offer (June 19), which was taken into account by Osiptel for the regulator to raise its own proposal (July 21), which was finally approved on September 29.

Following that same thread, on November 10, Osiptel published the draft to set the remuneration for access to the complementary access facility to the Regional NAP. The approval is pending.

Regarding the regional networks, Proinversión published the promotion plans for the drafts of Amazonas, Ica and Lima (April 6), and Junín, Puno, Moquegua and Tacna (June 22). The calls for bids for the aforementioned drafts began in mid-September, and the winners for the respective drafts were published on December 18: Amazonas and Ica were awarded to the GMC Conecta consortium; Lima was awarded to América Móvil; and Junín, Puno, Moquegua and Tacna were awarded to the Telecomunicaciones Rurales del Peru consortium.

On another note, the MTC published a draft to modify the “Master Plan for the Implementation of Digital Terrestrial Television (DTT)” on May 25, in order to extend the deadlines for the start of digital transmissions, due to the natural disasters caused by the phenomenon “El Niño” and the lack of expressions of interest by the broadcasters.

At that time, I argued that the phenomenon “El Niño” would not necessarily impact the broadcasters, as their stations are usually at the top of the localities, while the lack of interest of the broadcasters could possibly be due to other causes such as the disincentive of producing local content due to the inability to measure their rating.

Despite that, the MTC approved the aforementioned draft on September 30. At the same time, on December 30 the MTC modified the DTT Master Plan again to expand the deadlines to present expressions of interest for the change to digital technology.

On the other hand, on July 17, Osiptel published the draft mandate for the release of interference associated with telecommunications services, for the execution of infrastructure works.

The execution of infrastructure works by the State needs the release of interference from other infrastructures, such as telecommunications. Due to the increasing flow of investments and the greater deployment and sharing of telecommunications infrastructure, the possibility that said deployed infrastructure constitutes a possible interference to a public infrastructure work has increased over the years.

The objective of the draft is to generate a procedure for issuing a schedule and budget mandate for the release of said interferences. The draft was approved on December 16.

On a different matter, on August 11, the PCM approved the formulation of a plan to transition to the IPV6 protocol in public administration entities. The entities have one year for the preparation and approval of their respective plans, and additional four years for their progressive implementation. In addition, hardware and software acquisitions acquired in the future must be supported in the IPV6 protocol.

Regarding the spectrum, on August 16, the MTC published the draft that modifies the Frequency Attribution Table of the band 71-400 GHZ, and, on August 17, the MTC published the draft in order to approve the channeling of the frequency bands 71-76 GHz and 81-86 GHz.

About the satellite infrastructure, on October 17, Telefónica issued a statement that it would triple its capacity of the Ka band (provided by the Amazonas 5 satellite of Hispasat) to connect more rural areas of Peru.

One week after the announcement, on October 26, the MTC published the decree modifying the regulation of the provision of satellite capacity to telecommunications operators in Peru. As I said at the time, I presume that some discomfort with the lack of precision of the aforementioned rule should have occurred, either by Telefónica or Hispasat, so that the MTC would be encouraged to promulgate such a decree.

It should also be noted that a bill for a National Satellite Plan was published in January. Although in this normative review I have omitted the bills since most of the bills never are approved.

Finally, with respect to the RDNFO, in its moment we dealt with the challenges faced in its implementation and commercialization. In this context, Osiptel issued a report in November, at the request of the MTC, where it proposed alternatives for tariff flexibility for the RDNFO, among other measures.

Competition

After that, on November 2016, Osiptel started the procedure to establish the new mobile interconnection charges that will be in effect from 2018, Telefónica proposed the nullification of said procedure, arguing that the revision should only take place in 2019. On January 19, Osiptel declared inadmissible the demand of Telefónica.

On November 10, Osiptel published the draft that establishes the new mobile interconnection charges to be applied as of 2018, according to the following:

• Single charge (non-gradual) of USD 0.00659 per minute
• Urban charge of USD 0.00659 per minute and rural charge of USD 0.00209 per minute
• Charge modified periodically through an annual update mechanism for the top charge value

It should be noted that, according to Osiptel, Telefónica and América Móvil oversized their costs by proposing to maintain the current interconnection rates. On the contrary, Entel omitted relevant costs when presenting a proposal for a lower charge than the one proposed by the regulator.

On the other hand, on February 5, Osiptel published the draft to modify the Dispute Settlement Rules between Companies, which was approved on March 24.

On February 25, Osiptel set the new cap interconnection charges for access to the Payment Platform, after publishing the respective draft in November 2016.

Likewise, on March 13, Osiptel set the new interconnection charges for billing and collection, after which, in November 2016, it published the respective draft.

In the same way, on May 11, Osiptel set the new differentiated mobile interconnection charges for 2017, after the corresponding draft was published on April 12.

Another very discussed topic was the situation of the mobile virtual network operators (MVNOs), particularly for 2 events: the obligation of Entel to share its infrastructure with the MVNO Dolphin, and the exit of the market by the MVNO Virgin Mobile.

Osiptel issued an access mandate between Entel and Dolphin (August 23). This was a controversial case, since Dolphin was recognized as an MVNO by the MTC despite having a radio spectrum. Entel filed a motion for reconsideration of the mandate, which was declared partially founded by Osiptel (October 27).

Virgin Mobile left the Peruvian market in September, after just one year of operations. The reasons for said departure would be explained by commercial and regulatory causes. Regarding this last aspect, we analyzed the problems of MVNO regulation in Peru, related to mobile interconnection charges, wholesale access charges, as well as the unpredictability of the rules of the game.

On the other hand, on September 22, the MTC published a draft modifying the interconnection standards guide with the updates of the agreements of the Pacific Alliance and the Andean Community. The approval of said draft is pending.

Another draft pending of approval is the one presented by Osiptel on October 3, which proposes modifying the fundamental methodological principles for the determination of differentiated interconnection charges.

Another topic that was analyzed by Osiptel during most of 2017 was the determination of important suppliers in the local and long-distance leasing market.

Indeed, in December 2016, Osiptel extended the time to complete its research on the circuit leasing market for six months. In April, the term was extended again. Finally, on October 27, Osiptel ended its analysis, and published the draft where it maintains that there are no important suppliers in the circuit leasing market. The approval of said draft remains pending.

Finally, on December 23, Osiptel published the draft to modify the Numerical Portability Rule.

Users

By legislative decree published on January 6, and its subsequent rule of March 30, the Ministry of the Interior (MININTER) decided to create a National Register of Mobile Terminal Equipment for Security (RENTESEG), where apart from including the traditional blacklist, additionally incorporates the use of the whitelist.

Along that line of thought, by resolution of July 13, Osiptel issued the “complementary rules for the implementation of the RENTESEG”, in order to complement the provisions contained in the aforementioned rule, with respect to: the delivery and collection of information related to the devices on the part of mobile operators and importers, the consultation mechanism via web platform of the information of mobile devices and the regime of infractions and sanctions for the breaches of the operators.

Transversal to the users of telecommunications services, the PCM approved the “National Policy on Protection and Defense of the Consumer” on January 27, and the “National Plan for the Protection of Consumers 2017-2020” on March 15.

On the other hand, on February 5, Osiptel published the draft to modify the “Rule of User Claims”, which, after incorporating some proposals from the operators, was approved on March 31.

At the same time, on February 9, the MTC approved the measures to inform consumers in a timely manner about the lack of capacity of the broadcasting receiving equipment to receive broadcast signals under the ISDB-T standard.

On the other subject, on May 4, Osiptel interpreted – at the request of América Móvil – the articles of the General Tariff Rule (RGT) concerning the application of promotional rates. Osiptel interpreted that there is an exceptional case so that a promotional rate does not require a term of validity.

On May 11, Osiptel approved the creation of the User Councils for the period 2017-2019.

On May 26, the MTC approved the rule that sanctions the execution of malicious communications to the emergency, information or emergency centers.

Also, on July 13, Osiptel set up three Unipersonal Chambers of the Administrative Tribunal for the Settlement of User Claims (TRASU) in Lima, assigning powers to process files for: (i) complaint, (ii) appeal whose settlement period is of fifteen working days, and (iii) appeal in which the amount claimed does not exceed S / 100.

On August 13, Osiptel published the draft “Internal Rule of the TRASU” in order to update itself with the structural changes in the regulations of recent years, such as the creation of the Technical Secretariat for the Collegiate Bodies (2010), the promulgation of the Rules of User Claims (2015) and the latest modifications to the Osiptel organizational chart (2017), among others. This draft was approved on September 15.

A pending topic on the agenda for many years has been the definition of the minimum broadband speed in Peru. Thus, on October 3, the MTC published the draft that defines said minimum speed.

The aforementioned draft defines three types of broadband: basic, intermediate and advanced. The minimum effective speed would be 4 Mbps for download and 1 Mbps for upload in the case of basic broaadband, 10 Mbps for download and 2.5 Mbps for upload in the case of intermediate broadband, and 20 Mbps for download and 10 Mbps for upload in the case of advanced broadband. This proposal is pending of approval.

Another topic that was discussed during 2017 was the appropriateness of the charge for the rental and sale of decoders in the Pay TV service. Thus, on December 23, Osiptel proposed to prohibit selling or renting such decoders.

Finally, already closing the year, on December 30, Osiptel published a draft to modify the Conditions of Use, in order to limit some business practices of operators that undermine the rights of users, and make some transactions between users and operators more flexible.

This post is also available in: Spanish