Liberalization and Deregulation

Overview

2000 has marked the complete liberalization of the telecommunications sector. Prior to November of this year, the fixed line telecommunications market was run by the formerly privatized state owned operator, CANTV. Investments in fixed line infrastructure and services are likely to increase greatly. The new telecommunications law will have an significant impact on the market. The mobile, cable, satellite, value-added/data/multimedia markets have been open to unlimited competition since 1991.

Conatel (1)

The Comisión Nacional de Telecomunicaciones (Conatel) was created by on 5 September 1991 to supervise the privatization of CANTV, which comes under the direction of the Ministry of Transportation and Communications. It has supervisory, licensing and concession supremacy over telecommunications services and promotes investment and technological advancement in the sector.

The new telecommunications law was to replace the out of date law drawn up in the 1940's. Inn June 2000, the National Legislative Commission (CNL) gave approval to the new law, which is aimed at providing a more transparent regulatory framework for foreign investors and at reducing state intervention.

The areas that the new telecommunications law of 2000 covers are rights and duties of the consumer and installers and operators, universal service, public administration, prices and tariffs, interconnection, taxes, and rates.

Additionally, the new telecommunications law complies with the agreements made during the 1994 Summit of the Americas which laid the basis for a regional agreement on de-regulation of the telecommunications industry for Latin America. Some of the issues brought forth by the 1994 Summit are universal access to technology, apparent telecommunications laws, competition in telecommunications no later than 2005, and rate restructuring for cost-based rates.

Moreover, due to Venezuela's membership to the World Trade Organization, the country has complied with the following key agreements regarding the telecommunications industry: allowing foreign ownership by 2000; following competitive practices; universal service; and having regulatory body.

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