The COFECE Investigative Authority identifies barriers that affect competition in federal passenger transportation

Summary:

The Commission Federal of Economic Competition (Cofece) has preliminary findings indicating the existence of barriers to effective competition in the Mexican passenger transportation market. The investigation identified six possible barriers to competition and free competition, including relationships between competitors, directorial cross-pathing, and regulation-related issues. The main concerns are:

1. Existence of relationships between competitors, reducing rivalry and incentives to compete.
2. Directorial cross-pathing and contact spaces between competitors, facilitating information exchange and agreements.
3. Obligation to use terminals for passenger pickup and drop-off, limiting flexibility.
4. Permit restrictions to specific routes, reducing adaptability and competitive response.
5. Discreetness, opacity, and lack of transparency in terminal operations, hindering new entrants and benefitting established companies.
6. Restrictions on using vehicles other than buses, limiting options and increasing costs.

The Cofece recommends measures to eliminate these barriers, including ending coinvestments and avoiding decision-making conflicts between competing companies. Additionally, it suggests implementing compliance programs and regulatory changes to promote competition and dynamism in the market, ultimately benefiting consumers.