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Uberregulation Without Economics: The World Trade Organization's Decision In The U.S.-Mexico Arbitration On Telecommunications Services, General Agreement On Trade In Services, Gats, J. Gregory Sidak, Hal J. Singer

Federal Communications Law Journal

In April 2004, a World Trade Organization ("WTO") arbitration panel found that Mexico had violated its commitments under the Annex on Telecommunications to the General Agreement on Trade in Services ("GATS") by failing to ensure that Telmex, Mexico's largest supplier of basic telecommunications services, provide interconnection to U.S. telecommunications carriers at international settlement rates that were costoriented. The WTO panel deemed long run average incremental cost ("LRAIC") to be the appropriate cost standard for setting settlement rates. Mexico thus became obliged to change its domestic telecommunications regulations or face trade sanctions. The decision is the first WTO arbitration to deal …