Ruling suspends government attempt to annul Cablevisión's rate hikes

Thursday, April 7, 2011

A federal court in Córdoba province has issued a ruling suspending the effects of two resolutions implemented by the Argentine domestic trade ministry, which fixed the monthly rate for cable TV services in the country, local newspaper La Nación reported.

In the ruling, federal judge Ricardo Bustos Fierro ordered the government to abstain from executing these resolutions. The ruling was issued after an appeal by Grupo Clarín's Cablevisión unit.

In March, the domestic trade ministry moved to annul the last two price adjustments Cablevisión applied to its monthly basic cable services, the most recent occurring in January. According to local press reports, in July 2010, the company raised the price from 109 pesos (currently US$27) a month to 126.80 pesos a month, and then in January this year raised it 16% to 147 pesos.

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The ministry fixed the price at 109 pesos starting from January 2010, thus ordering Cablevisión to reimburse the difference to its customers from the months when the increases were in effect. The resolution orders Cablevisión to begin the reimbursements starting with the billing month of April.

Cablevisión's parent company - Argentine media giant Grupo Clarín - has criticized the federal government in the past years, and this play to fix rates is seen as backlash from President Cristina Fernández's administration.