Telecommunications Alert – September 2024

Proposed laws for the regulation of mobile equipment are presented, referring to the establishment of provisions to prevent the use and resale of stolen equipment, as well as the prohibition of charging penalties for the purchase of such equipment.

During the month of August 2024, bills have been presented in the Congress of the Republic regarding mobile equipment. Specifically, we refer to (i) Bill No. 8630/2024-CR, filed on August 15, which establishes provisions aimed at preventing the use and resale of stolen cell phones; and (ii) Bill No. 08721/2024-CR, filed on August 27, which prohibits operators from charging penalties to users for the purchase of mobile equipment.

The main provisions of the Bills are detailed below:

• Regarding Bill No. 8630/2024-CR, it establishes, among other aspects, (a) the creation of the National Registry of Stolen Mobile Devices, administered by OSIPTEL, where equipment reported as stolen will be registered; as well as (b) rules on the blocking of IMEI; In such a way that the operating companies will not be able to activate or reactivate phones with IMEI that are in the referred registry and, in the case of chips of devices with IMEI reported as stolen, cloned or invalidated, these will send alerts of attempted use to the corresponding operating company.

It is important to note that the current legal framework already regulates a registry aimed at preventing and combating the illegal trade of mobile terminal equipment, called the National Registry of Mobile Terminal Equipment for Security (RENTESEG), which provides for the registration of equipment in a Black List and a White List, as appropriate. This year the third (last) phase of RENTESEG was implemented; however, the measure related to the blocking of imported equipment not registered in the White List (scheduled for July 22) was suspended until further notice and after OSIPTEL and the Ministry of the Interior design a better strategy for its implementation. Therefore, considering this background, it is relevant that, in case the Bill is approved, the way in which both regimes will coexist is regulated.

• Regarding Bill No. 08721/2024-CR, it provides for the incorporation of (i) Article 89 in Law No. 28737, Telecommunications Law, which expressly prohibits operating companies from imposing penalties or additional charges for the purchase of mobile equipment; and (ii) the incorporation of Article 106. 3 in Article 106 of Law No. 29571, Consumer Protection Law, in order to classify the imposition of penalties or additional charges for the purchase of mobile equipment as an abusive commercial practice, punishable by law.

This legislative proposal would seek to promote competition in the mobile equipment market by eliminating the possibility of operators to impose penalties and additional charges which, according to the proposal, have caused an unjustified economic burden that limits users in their free choice of devices and forces them to accept unfavorable conditions to avoid this prejudice.

Both bills are currently being evaluated by the Transportation and Communications Commission.

For further information, please contact María del Rosario Quiroga (rquiroga@estudiorodrigo.com), Andrea Morelli (amorelli@estudiorodrigo.com), Luis Fernando Roca (lroca@estudiorodrigo.com) and/or Adriana Chavez (achavez@estudiorodrigo.com).