Court Sides with Telecom Argentina in Telefónica Merger Dispute

Telecom Argentina has gained a crucial legal reprieve in its ongoing battle with the government over its acquisition of Telefónica Móviles Argentina, clearing at least one obstacle in what may be a drawn-out regulatory clash.

According to a stock market filing released late last week, the Federal Court of Appeals has sided with Telecom Argentina’s appeal against a government resolution that barred it from taking any steps to integrate with Telefónica’s former Argentine unit. Per the statement, the court granted the appeal “with suspensive effect,” and ordered the Secretary of Industry and Commerce to refrain from implementing any measures that would contradict the suspension.

The ruling marks a temporary victory for Telecom, which in February finalized a US$1.25 billion purchase of Telefónica’s local operations. The acquisition came amid Telefónica’s broader effort to exit several Latin American markets, including recent sales in Peru and Uruguay. According to a statement from Telefónica, the Argentine deal was unusual in its speed, with the transaction signed and closed on the same day — a move that surprised observers and quickly drew political scrutiny.

President Javier Milei’s administration responded swiftly, voicing strong concerns about the potential formation of a telecoms monopoly. The President’s office issued a statement warning of excessive market concentration, pointing to figures that a combined Telecom-Telefónica entity would control over 60% of Argentina’s mobile market, 69% of fixed-line services, and up to 80% of broadband internet access in certain regions.

Related: Telefónica Exits Argentina with $1.25B Sale to Telecom, Prompting Oversight

Based on the recommendation of the National Commission for the Defense of Competition (CNDC), and with involvement from telecoms regulator Enacom, the government imposed a freeze on the merger activities in late March. Telecom Argentina’s legal challenge to this freeze is what the recent court decision addresses.

Despite this legal win, political opposition remains fierce. President Milei has made no secret of his distrust of Grupo Clarín, Telecom Argentina’s parent company. A pinned post on his official X (formerly Twitter) profile, titled “Clarin: the great Argentine scam,” accuses the media and telecoms conglomerate of seeking to monopolize national communications infrastructure. “They want to control the entire country’s communications,” the post reads, further alleging that Clarín’s opposition to the government stems from its desire to protect its market power.

According to the court’s decision, the appeal suspends the prior resolution, allowing Telecom Argentina to continue with operational planning around the integration, at least for the time being. However, the CNDC investigation into the merger’s potential market impact remains ongoing.

Source: Telecoms