After the UCCAEP in Costa Rica began to negotiate the lifting of the blockades with the self-proclaimed group Rescate Nacional, promoter of the protests, several business chambers distanced themselves from that decision and others have expressed their support.
Given the wave of protests and blockades that have been reported in the country, which arose after it was reported that to access a loan from the International Monetary Fund for $1.75 billion, the governmentplanned to tax financial transactions, raise the tax on the profits of companies and persons, and increase the tax on real estate. The Costa Rican Union of Chambers and Associations of the Private Business Sector (UCCAEP) decided to negotiate the lifting of the blockades.
Requests have been made for the clarification of which telecommunications services are to be taxed with VAT, since it is unclear whether it is information services or telecommunications which would be taxed.
Currently telecommunications services are charged sales tax, even though the Costa Rican government aims to close the digital divide. With this new reform proposal, a Value Added Tax (VAT) of 15%, "would be incurred ... It would be the first time that telecommunications services are integrated into a tax
While in other countries there are a greater variety of packages and lower prices than those offered in Costa Rica, lack of modernization of networks and costs are preventing operators from improving their services.
At present, only 56% of the population has internet access and of this total 80% use services with download speeds of 1 Mbps, 10% with 2 Mbps and less than 1% use download services with over 10 Mbps.
Even though demand continues to grow, operators are not able to grow due to lack of effective competition in the mobile market and delays in the allocation of spectrum.
A portion of customers in the cellular market and other telecommunications services such as internet and cable television are still dissatisfied, but telecommunications companies are not able to increase their services due to the slow rate at which the rules are set and at which infrastructure problems are addressed.
Businesses have denounced the arbitrariness with which municipalities are establishing rates and conditions for granting permits for setting up telecommunication towers.
The industry is calling for effective competition to be allowed with the market setting rates and not the Telecommunications Regulator.
Operators of telephony and internet services are asking for the establishment of maximum rates by the Superintendencia de Telecomunicaciones (Sutel) to be eliminated, applying what is contemplated in the Telecommunications Act, which allows the possibility of not intervening in the setting of rates. The companies point out that "... the market prices are up to six times lower than the maximum rate established by the Sutel."
A change in the law requires more than 500 companies to cease using radio frequencies that had been granted to them on a temporary basis before 2008.
The companies grouped in the Chamber of Info-communication claimed that the frequencies granted temporarily under the law prior to 2008, are eligible for authorization for permanent operation, but that "... 'because of inefficiency on the part of the state to check whether applicants met the requirements, they had to create the model of reserve frequency (a term used to describe the situation of these companies) and even charge taxes to all natural and legal persons who have now been declared operators of obsolete frequencies. '"
Removing the tariff regulations on cellular services and improving the availability and access to broadband should be a priority for the new government, say experts in the field.
In Costa Rica "... there are mobile operators who did not go through a public tender process, who do not pay for the frequencies they use, and who do not have any coverage obligations ..."
"We are talking about public property which five years ago, when the Telecommunications Act was passed, had a low profile and was largely unregulated," noted an article in Elfinancierocrc.om.
Five years after the fall of the monopoly, there are more companies, more users and a greater array of services on offer, with growth of 45% in the sector's contribution to GDP.
According to data reported by telecommunications companies to the Superintendency of Telecommunications (Sutel), the sector's contribution to the economy has grown by 45% over the past five years. In 2012, these companies reported gross income which exceeded $1.315 billion, equivalent to 3.3% of GDP.
The Government is considering a possible tender for a new radio frequency block that would provide fourth-generation mobile services.
Alejandro Cruz, Minister of Science, Technology and Telecommunications (Micitt), asked the Sutel to define the future of the 70 MHz block not auctioned in 2011, when Telefonica and Claro were awarded frequencies. These companies have shown interest in having more spectrum to expand the supply of fast mobile Internet services.
Telecoms companies in Costa Rica demand the abolition of a decree which allows the government to award contracts without bidding in the National Telecommunications Fund.
According to the Chamber of Information and Technology this could cause market distortions and they warn that the decree could have implications and consequences of possible violations of the Free Trade Agreement with the United States (CAFTA).
Only 28% of the country's municipalities have clear rules for granting permission to install radio base stations.
In a note presented to congress on March 31, the Chamber of Info-communication and Technology reported that, "to date, only 23 of the 81 municipalities and 3 district councils have approved celular telephony infrastructure regulations".
In Costa Rica the tax authority (DGT) interpreted that internet access should pay sales taxes (13%).
This has caused negative reactions from many sectors, for example the Technology Chamber, headed by Fabio Masís, stated that “prices are expected to increase, with negative consequences on low income users”, and that this decision violates the Constitution.
According to Román Fallas, president of the Chamber, the market has not been properly opened and the process demonstrates “a lack of political coordination” between the Environment Ministry, the regulator (SUTEL) and the current state-owned electricity and telecommunications provider (ICE).
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